ACCOUNT FOR COVID-19 FUNDS BEFORE LEVYING US

For quite some time now, I have relaxed in writing. Not because I have nothing to write, but because there are too many issues unfolding which are so important and complicates what topic to choose to write on. Today, I have decided to concentrate some attention on the signs that are becoming clear of the next four years of the President Akufo-Addo’s government. Governance is an important part of every nation. Where it goes right, the people benefit, and where it goes wrong, the people suffer. Many were those who were ecstatic about a year ago over what government termed free interventions to businesses and individuals. There is no doubt that some people benefitted from these interventions, but the question remain, how many people really benefited contrary to government claims? And how do we verify the claims of government in the absence of data? This article would raise some critical issues that we all need to reflect over and demand, the basis of which government may just be open to us and make governance better.

It has emerged that the free water to “all” citizens and free electricity to lifeline customers and the proposed 50 per cent reduction for domestic and industrial consumers, were not free after all. We are waking up to a levy in this regard which government hints it intends to use to pay for the expenditure made to the tune of some 19 billion Ghana Cedis (3.16 billion USD). This proposal in the Budget and Economic Statement of 2021 presented before Parliament a couple of days ago, has attracted public uproar with many condemning same. As usual, there are those who would defend it, albeit that they were part of those who trumpeted the goodness and mercies of the president at the time for providing these services for free without any knowledge that Ghanaians would be asked to pay for them after the elections of December, 2020.

We must put the issues in their proper contexts. When in March, 2020 thereabouts, the President decided to impose a lockdown as a result of the country recording Covid-19 cases, some interventions were announced. Before then, proposals were made for the government to access the Stabilization Fund established by the previous government of John Dramani Mahama for the purpose of providing cushion for the Ghanaian people on whose behalf the Fund was set up. Because of the widespread support, including the suggestion coming from the former President John Mahama, Parliament was able to amend the Act establishing the Fund to enable the President through the Finance Minister withdraw USD200 million (the equivalent of Ghc1.2 billion).

In addition, after meeting the conditions set by the World Bank, some initial USD35 million was released to support Ghana (https://www.worldbank.org/en/news/press-release/2020/04/02/argentina-banco-mundial-covid-coronavirus). Subsequently, another USD65 million was released as part of the support for Ghana for the fight against Covid-19 (https://www.worldbank.org/en/news/press-release/2020/11/10/world-bank-group-supports-ghana-to-boost-its-covid-19-response). Soon after, the International Monetary Fund (IMF) advanced a Rapid Credit Facility to the tune of USD1 billion to Ghana to aid in the fight against Covid-19 (https://www.imf.org/en/News/Articles/2020/04/13/pr20153-ghana-imf-executive-board-approves-a-us-1-billion-disbursement-to-ghana-to-address-covid-19). It is significant to note that the IMF facility is an interest-free loan with a 5 year moratorium which simply indicates that the loan repayment begins after 5 years. This again suggest that the Akufo-Addo second term in office would make no repayment on the IMF Rapid Credit Facility. It also means that the President who comes after him in 2025, would be the one to look for money to start repaying the loan.

It is also important to recall that the IMF facility was approved on or about the 13th of April 2020, and by the time disbursement was done, the lockdown imposed for which this fund was badly needed, was lifted on the 20th of April 2020, just 7 days after the money was accessed. Ghanaians went about their businesses with only news of the National Board for Small Scale Industries (NBSSI) providing stimulus packages for businesses.

We must also remind ourselves of some important issues that raise serious questions on the use of the Funds secured. Before that, I must establish that due to the challenges of Covid, the government launched a Covid-19 Relief Fund and solicited for funds from businesses and individuals. It emerged that even state institutions made donations into the fund with questions on the legality of such conducts. As at the last recall, some Ghc50 million was reported to have been donated into the Fund. This Fund was expected to be used to provide relief to those who require it. We are yet to have a full record of its usage.  

Government apprised us to the effect that during the lockdown, some 400,000 citizens were provided food. We all saw what was fed people and how that was done. While, in Parliament to brief the House, the then Finance Minister, Ken Ofori-Atta, could not explain the very criteria that was used to select the said 400,000 Ghanaians who benefited from the food distributed. Indeed, what government did was to determine the amount of money allocated, determine the cost per head, and the amount allocated divided by the cost per head and to arrive at a figure of 400,000. There was no transparency in this process, and there was no serious accountability.

In any serious country, the poor and vulnerable who needed this intervention, would have been identified, their various places of residence marked with a list identifying each of them, and then they are marked on daily basis as soon as they take their food. What was done was short of this, and yet, Ghanaians are expected to swallow government narrative. What we saw, were trucks with cooked and packaged food, once they arrive at a location, anyone who is able to show up, gets served and that was all. We forgot that there are people with disabilities who might not be able to come out to get their food but who needed it most, and who never got the intervention so intended. I therefore would refuse to accept that 400,000 Ghanaians were fed during the lockdown until such a list is produced that can be verified.

In the 2021 Budget estimates presented in Parliament, the Leader and Minister for Parliamentary Affairs in paragraph 361 states “As at end December 2020, about GH¢412.88 million has been disbursed to support 277,511 businesses of which 69% were female-owned. The scheme has saved over 650,000 MSME jobs. In addition, 8,159 beneficiaries received technical training on Entrepreneurship, Financial Literacy and Bookkeeping to improve business practices.” It is difficult to doubt these figures. However, it is highly difficult to believe the same figures on the back of the principle I advanced in the paragraph above. It is easy to throw in these figures in an attempt to balance the budget and to conceal the real expenditure made in this regard. I would call on the Finance Committee of Parliament, to as a matter of need, demand the full list of the said businesses that benefited from the interventions to confirm the 277,511 figure provided in the budget. A simple mathematics, which may be flawed because the packages were not distributed evenly, provides that by dividing the 412.88 million by the 277,511 businesses, each business received some Ghc1,488 (the equivalent of USD248). We need to know what went into these disbursements and their impacts.

As cited earlier, we accessed 1.2 billion Ghana Cedis free money from our own savings for use during the pandemic. Its usage is eluding us as government has remained unwilling to speak to the usage comprehensively. We expected that part of this money, including other funds such as the one from IMF, would cater for the supposed free supplies. If today, we are being asked to pay back in levies, I would be right to wonder what we used our own free savings to do. We are aware, and as I stated earlier, that the IMF facility which is the largest, granted Ghana a 5 year moratorium. The Akufo-Addo government would make no repayment on this facility. That being the case, why is he levying Ghanaians in the name of paying back for the freebies? Is it not just fair and right to leave the campaign to mobilize for funds to pay back the loan with the next government that would be charged to pay? What he is doing now, is simply to mobilize money to meet budget expenditures and then leave the loan amount for another government to pay. That truth must be told us.

Further, we are being charged a levy for the collection of refuse dubbed Borla Levy. We must again ask what this has got to do with Central Government in our context. We have assemblies that have consistently charged levies on citizens. The waste collection companies charge for the waste they collect from households. What therefore is the basis for the proposed introduction of this Borla Levy for revenue to the Central Government? I think we need some explanation.

We all recall that when the Value Added Tax was introduced in about 1995, the current President Nana Akufo-Addo, joined a demonstration against the proposal. This led to the death of one of the demonstrators which attracted wide attention and commentary. Many were those who believed that his involvement in that demonstration, shot him into the political limelight of Ghana. One would have thought that he would have nothing to do with VAT soon after becoming president in 2017. But, that was not to be. In 2018, under the guise of restructuring VAT, an increase in the rate was observed. In the 2021 Budget and Economic statement, there is a further proposal to increase the VAT rate by an additional 1 per cent. Several other levies have been imposed including some in the energy sector which is expected to increase the cost of a litre of fuel.

I have had to bring in these issues of taxes in addition to my presentation on the covid-19 expenditure to expose how government is desperately in need of cash to meet its fiscal obligations. The recent attempts to slash the budget of the Legislature and the Judiciary, speaks a great deal of how broke government is. The management of the Covid-19 funds reveals how reckless government was in organizing its expenditure. We should have known that since the pandemic had no timelines, we ought to have been circumspect in the rate at which we depleted monies that came into our hands as we were lucky to have. We behaved as if we had in our minds, the duration of Covid-19 and proceeded to expend the monies in such a way that would provide political advantage. The reality faces us, and the ordinary man who might not have benefited from any of the so called freebies, would be compelled to pay for government’s recklessness in spending.

Indeed, at this time that government is burnt on recovering from the shocks of Covid, we are not out of the woods. Covid-19 is still having an impact on our economy. Not too long ago, Brazil had had to contend with rising cases. Some countries have recently reintroduced restrictions in order to have a grip of the ravaging impact of the pandemic. So what happens, perish the thoughts, if Ghana happens to be hit yet again? As we speak, many people are yet to find their feet back to work. Businesses are merely surviving, others remain closed because they are unable to operate based on the measures government had introduced.

In all of these, I hold the view that government had not been transparent to the citizens. There has been a complete lack of transparency in the handling of the entire Covid-19 crisis. People might have used the opportunity to make money which the state must be interested in retrieving. In order to ascertain that, there is the need for a special audit into the management and use of all monies secured in the name of dealing with Covid. We are almost 4 months into the year 2021. We are yet to receive any assurances of any full-scale special audit into the management and utilization of the Covid-19 Funds and related revenues and expenditures. Government must provide the citizens with a full list of those who handled the monies, what they used it for, and those who benefited so that we allow persons listed the opportunity to confirm or state otherwise what the claims in the accounts are. We just cannot ignore this and pretend nothing had happened. We need to demand higher standards of accountability.

Governance must be aimed at resolving the curiosity of citizens. A transparent government will attract the support of the people. What is the motivation to pay additional taxes when existing revenues are not accounted for in a manner that set aside all doubts? The duty of government must go beyond taxing and spending, just as the duty of citizens must go beyond paying taxes and hoping that they are spent in the right manner to include demanding accountability at all levels with government willing to remain accountable when called upon.

I am of the view that the Ghanaian people must be given sufficient reason on how what they were told to have been given free of charge, has had to be paid for. It therefore requires that accounts are rendered fully so we know our shortfalls and the measures being put in place. In that way, we will be more than willing to contribute our quota towards the development of this country of ours.

ASK

2 thoughts on “ACCOUNT FOR COVID-19 FUNDS BEFORE LEVYING US

  1. Very informative and straightforward! If only, Ghanaians would hold this president and his government accountable for all the monies they have borrowed and taken out of the country’s coffers! Ghane seem to be going down a slippery slope to poverty, at a speed, faster than lightning!

    Keep up the writing, ASK! 😊

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s