Business licensing delays linked to understaffing of regulators

A joint study by the Private Enterprise Federation (PEF) and the USAID has revealed that understaffing and financial constraints in regulatory institutions are the main reasons behind delay in the timely issuance of licences to businesses.

Regulatory and licencing institutions like the Environmental Protection Agency (EPA), the National Fire Service, Metropolitan, Municipal and District Assemblies (MMDAs), as well as the Factories Inspectorate Department of the Ministry of Employment have all been found to be short of technical hands to handle administering certificates and permits to businesses.

At a media briefing in Accra, CEO of PEF, Nana Osei Bonsu, said the situation is increasingly becoming frustrating to investors and is hampering the progress of the economy, hence, their interest in conducting the study.

PEF has been engaged in advocacy action on streamlining cross-sectional licencing requirement.

The EPA for example, takes a mandatory 90 days to access a large scale impact project whereas a small scale impact project takes 25 days to access, a situation that could have been better had the institution been adequately staffed, he said.

Acting Director of the Environmental Assessment and Audit Unit of the EPA, Kwabena Badu Yeboah, confirmed to the B&FT at the event that: “We currently have 387 staff members with half of them being non-technical. But we need over 1000 staff members to make us run efficiently”.

The Ghana National Fire Service (GNFS) are supposed to have at least two inspectors in all the 217 districts, but only has 50 inspectors nationwide.

Additionally, according to the Tema Metropolitan Director of the Department of Factories Inspectorate (DFI), the agency currently has a technical staff strength of 28, but requires over 50 of them to run smoothly. As a result of this, it takes two weeks to complete a factory inspection.

The Principal Officer of the Town and Country Planning Department (TCPD), Mohammed Alhassan, said the institution is currently operating with only 34 percent of its staff capacity, whereas it needs more than 300 staff members to operate optimally.

Other challenges the study found include the absence of an electronic application platform to ease the application process, and also low awareness of application process and procedures.

The fact that all the agencies are required to transfer all their earnings into the consolidated fund without retaining any, was also cited as a constraint.

Again, the study discovered that the Cap 84 of 1945 and the Factories, Offices and Shops Act, 1970 (Act 328) which govern the operations of the TCPD and DFI are outdated and need amendment.

The absence of a formalised training programme and manuals to train inspectors in the TCPD and GNFS, according to the study, are among the major challenges confronting the sectors.

Urgent action, Nana Osei Bonsu said, is required to rectify the situation or fortunes in the private sector will continue to dwindle.

“The inefficiencies are at such levels that unless we do something about it, private sector businesses and their competitiveness will continue to suffer,” he said.