Ghana: PIAC Tasks Parliament To Find The Whereabouts Of $1.5 Billion Petroleum Fund

The Public Interest and Accountability Committee (PIAC), an independent statutory body mandated to promote transparency and accountability in the management of petroleum revenues in the Republic of Ghana has urged the country’s Parliament to ensure that the Finance Ministry render an account for the $1.5 billion unutilized Annual Budget Funding Amount (ABFA).

The Committee noted that while GHC2.7 billion was available for spending in 2019 only GHC1.2 billion was utilized, leaving a balance of GHC1.5 billion.

“For the third consecutive year, not only has a sizable proportion of the ABFA not been fully utilized, but it has also not been accounted for, thus, impeding PIAC’s appreciation of the full scope of accounting to the public on the utilization of our petroleum revenues,” Mr. Noble Wadza, Chairman of PIAC, said as carried by Ghana News Agency.

Mr. Wadza who was launching the 2019 Report said in 2019, 45.14 percent of the actual ABFA was spent on recurrent expenditure, with 54.86 percent on capital expenditure in violation of Section 8(4)(a) of Act 893 which requires that a minimum of 70 percent be spent on public investment expenditure.

Besides, for the second consecutive year, there was no allocation from the ABFA to the Ghana Infrastructure Investment Fund (GIIF), contrary to the provisions of the Petroleum Revenue Management Act and GIIF Act 877.

Commenting on the Ghana National Petroleum Corporation (GNPC), Mr Wadza said the Corporation continued to provide guarantees for a range of state-owned enterprises (SOEs), amounting to US$645.5 million in 2019.

This is about double, compared with the previous years’ and also outweighs the Corporation’s total equity financing expenditure of US$164.79 million for the period.

In 2019, GNPC supplied US$334.6 million worth of raw gas to the Ghana National Gas Company (GNGC), but no payment was received, in respect of the supplies.

This is largely because of VRA’s inability to pay GNGC for the lean gas supplied. Added to the outstanding balance of US$333.5 million, this brings the total indebtedness in respect of lean gas supplies to US$668.1 million.

The Committee reiterated its call on Parliament to consider placing some restrictions on the proportion of GNPC’s budget on CSI and guarantees to state institutions, particularly in the light of the Corporation’s inability to respond to some of its cash calls.

It also called on the government to address the unsustainable debt of GNGC and to expedite action on the infrastructure requirement for gas evacuation and utilization, to avoid huge backlog of make-up gas volumes and the potential for resource waste.

Source: www.energynewsafrica.com