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Making oil revenues count in an election year

  • SOURCE: | qwesa2big
  • oil money

    The oil and gas sector, globally continues to be a major boost for economic growth for countries that are able to effectively manage the resource.

    In Ghana, the anticipation wasn’t different after the discovery of oil and the subsequent production in commercial quantities from 2010. For most people, however, the anticipated ability of oil revenues to spearhead development in the country is not so evident, five years on.

    The US$3.2billion that has come in as revenues from the sale of oil from the Jubilee Field over the period, for many, has been poorly managed despite the institution of policies and laws to ensure effective management.

    Then comes in the Tweneboa, Enyera and Ntomme (TEN) fields in August 2016, ahead of the general elections, which is expected to ramp up production of the country’s oil and subsequently increase its revenues, but management of the revenues continue to be of concern to many.

    “With the TEN coming on with 20,000 barrels a day and with ENI to come on with gas in addition, it means there would be an extra revenue that is been anticipated and if it comes, it is going to help improve infrastructure work of whichever political party that wins; so whoever puts it in their manifesto is in the right direction,” the Chairman of the Public Interest and Accountability Committee (PIAC), Professor Kingsley Buah- Bassuah said in an interview on September 22.

    Parties on oil

    Ahead of the December polls, the various political parties earlier this year, launched their policy positions on the sector, detailing how they will be addressing issues relating to transparency, revenue management and others.

    The political parties that launched the policy positions include the governing National Democratic Congress (NDC), the main opposition New Patriotic Party (NPP), the Convention People’s Party (CPP) and the People’s National Convention (PNC).

    For the NDC, the enactment of various laws such as the Petroleum Revenue Management Act, 2011 (Act 815), the Petroleum Commission Act, 2011 (Act 821) and the Petroleum Local Content and Local Participation Regulations 2013 (L.I.2204) are to ensure a transparent, effective and efficient natural resource management regime for the oil and gas sector and this would continue beyond the elections.

    The NPP, as part of their policy position, said it was going to promote transparency and accountability through legislation as the current level of transparency in the sector was not enough.

    For the PNC, the party would ensure that information and public documents, including those related to contracting processes from the oil and gas sector, is made accessible and oil and gas contracts shall be subjected to the Public Procurement Act (PPA).

    The CPP, in their position paper, said it was going to develop the institutional capacity of the Ghana Revenue Authority (GRA) to ensure the efficient audit and declaration of revenue from the extractive sector. It would also ensure the passage of the Extractive Industry Transparency Initiative (EITI) Bill, as well as strengthening the institutional capacity of the PIAC to facilitate greater transparency and accountability in the management of the extractive sector revenue.

    Implementation is key

    Currently, all the parties have proposed policies and institution of Acts to streamline the management of the oil and gas sector, but the impact would be felt when it is implemented to the latter.

    The Head of Policy at the Africa Centre for Energy Policy (ACEP), Dr Ishmael Ackah, in an interview said there was the need for political parties to incorporate their visions for the sector into the long term development plan of the country to ensure that these proposed policies are implemented.

    It is high time we compute some of those promises especially the ones in the manifestos to be able to hold them accountable to it. We should also try and coordinate with the NDPC so that some of the nice ideas will be factored into the long term plan we are developing, so when they come it doesn’t become only party manifesto they are implementing, but they are implementing a national policy,” he said.

    A citizen, Mr Michael Thompson who also shared his perspective on the relevance of oil and gas issues in an election year in an interview said “it is one thing drawing policies and another implementing them without diversions to the latter. The issue of transparency in the disbursement of oil proceeds needs more scrutiny than stated, which brings us to the right to information in this country.”

    Expectations ahead of elections

    With about two months to election 2016, and campaign of political parties gathering steam, issues pertaining to the oil sector and management of its revenues continue to be on the minds of people.

    For Dr Ackah, any government seeking power should be able to clearly state how it would deal with the volatility in oil prices looking at how it could affect government’s budget.

    “Oil revenues are a major component of government revenue, so you can see that when there was a shortfall in oil prices, it affected government, and it had to go to Parliament to revise its budget,” he said.

    He added, “we want a government that can put in measures to deal with the volatility of oil prices. Any government coming in should have the capacity to deal with the impact of the volatility of oil prices on its revenues.”

    Mr Thompson said he expected to hear the political party policies speak on how to channel some of the proceeds into developing a more sustainable energy source for Ghana.

    “You see, owing to previous ditching of policies when elected into power, I would like to see more than just policies to enable me decide whom to vote for. What I will need are measures to ensure there are checks to coerce governments to follow through their policies. The more commitment I see, the better my chances of voting for that party,” he said. —GB


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