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Limit projects funded with oil revenues

  • SOURCE: | qwesa2big
  • The Ranking Member on the Mines and Energy Committee of Parliament , Mr. Adam Mutawakilu has recommended a shift from the current use of oil revenues on several projects, which makes it difficult to assess their impact.

    Instead, he suggested that  enough funds should be allocated to an identifiable project within a particular year  to ensure its successful completion before moving on to another.

    Currently, oil revenue is  treated as part of a pool funds for many infrastructure projects and in some cases, allocation made are so insignificant that it is very difficult to assess the efficiency of the usage of the  revenues.

    In interview with participation of an going  training, sponsored by Ghana  Oil and Gas for Inclusive Growth (GOGIC) aimed at enhancing the role of the media at enhancing the role of the media in promoting transparency and accountability, Mr. Mutawakilu said it was regrettable that the  country could hardly  point  to significant projects that have been funded fully with oil revenues over the years because  revenues over the years  because  revenues have been spread thinly across many projects.

    ‘Over the years, the revenue has been spread thinly.

    Allocating about  GHC500,000 for a road  project that was already  ongoing  would  not lead to its completion.’’

    We are suggesting that we reduce the projects that the oil money is being used for so that  at the end  of the year, we can  count two or three projects that revenue has been used for, he said.

    Priority area, not a problem

    Under the petroleum Revenue Management Act(815)2011, the Minister  of Finance  is expected  to select  for priority areas for which  oil revenues would  be allocated in the  absence of a long term  development plan.

    From 2011 to 2016, the priority areas chosen were agriculture, modernization, roads and other infrastructure, amortization of loans and capacity building.

    The areas have been reviewed from 2017 to focus on agriculture, physical infrastructure and service delivery  in health  and road, rail and other critical infrastructure development.

    Although  industry  players  have raised concerns about the priority areas and it been used as an  omnibus  spending  area, the projects that  received funding that remained a challenged.

    He said even if a single priority area was selected, and it has several projects earmarked to received funding, the revenues would still be spread thinly.

    ‘Even if it is one sector, the ministry can have several projects and that would continue to be a challenge. But out of that, they should pick one and apply the money to it.’

    ‘If you pick agriculture for instance, they should have one project that the allocation for the year should be used on.

    The road ministry should have one they can apply the money on and execute the project, ’he said

    He said at the end of the day, the country should be able to point at projects, just like the gas infrastructure at Atuabo in the Western Region that oil money has been used for.

    We would like to see many of that but currently, it is spread thinly and we think that is a big problem,’’ he said.

    Efficient spending

    Energy think tank, the Africa Centre for Energy Policy (ACEP)is urging the government  to use oil revenue  efficiently to ensure maximum benefits for the country.

    The advice comes on the back of anticipated boost in the production of oil from Sankofa Gye Nyame and the   Ten fields expected to fetch the country more revenue.

    The Executive Director of the ACEP, Mr. Benjamin Boakye, however cautioned that  with  the current trend of proof governance around the management of revenues from the jubilee Field, care must be  taken to ensure that the trend was not repeated going forward. We  have to ensure that governance around the management of our  revenues is substantial to maximize economic benefits,’’ he said while  addressing participants the training.

    Many industry experts have raised concerns over the poor governance of oil  revenues over the last six years, expressing fears over the country will not  been able to show anything for   oil  production after the resource runs out.

    Already the four priority areas selected for oils  revenue spending was used as an omnibus spending avenue for projects which  were  not  prioritized and successive governments have failed to give any explanation for this

    Mr. Boakye, therefore, urged the media to play an active role in the governance of oil revenues in the country to help fight corruption and misuse of revenues.

    ‘it is not always pleasant to tell the bad stories. The media must be part of governance of oil in Ghana. They must monitor and not allow politicians to have a field day’’ he said. -GB

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