Mining activities are known to have serious negative effects in places where they occur. Therefore in order to provide financial resources to overturn the negative impacts of mining activities and also for the benefit of mining communities, an administrative arrangement was set up in the 1992 constitution, section 267 (6) and subsequently, even more refined the Minerals Development Fund Act, 912 of 2016.
The purpose of Act, 912 is to address the development challenges affecting communities by setting aside a higher proportion of royalties for development projects. The Act introduced the Mining Community Development scheme to directly sponsor socio-economic development in communities in which mining operations takes place or which are affected by mining activities.
The fund also provides financial resource for the direct benefit of mining communities, holders of interest in land as well as traditional and local government authorities within mining areas.
We commend Government for its efforts and determination to manage the resource effectively and strategically for public good as shown by the establishment of a Mineral Development Fund Secretariat.
However there are deep concerns with the management of the fund as far as governance issues are concerned.
Importantly, the law requires under section 6 of Act 912 that the board of the fund be constituted with the following persons;
- A chairperson,
- One representative of the following Ministries not below the rank of a Director:
- Ministry of Local Government and Rural Development
- Ministry of Environment, Science, Technology and Innovation And
- Ministry of Finance
- The Chief Director of the Ministry of Lands and Natural Resources
- The Chief Executive Officer of the Minerals Commission
- The Executive Secretary of the Lands Commission
- The Administrator of Stool Lands
- A representative of the Ghana Chamber of Mines
- A traditional ruler from a mining community nominated by the National House of Chiefs
- One person, who is a woman, nominated by the Minister for Mines The members of the Board shall be appointed by the President in accordance with article 70 of the Constitution.Over two years of policy implementation, it is shocking that government has not constituted the board to perform its very crucial functions which is not limited to appointing the Administrator to the Fund; compared to the current practice of an acting administrator.
Again, of special interest to us is sections 23 and 25 of the Act which hinges on accounts and audit and annual reports of the fund.
Taking cognizance of Natural Resource Governance Institute 2018 briefing on analysis of Gold Company Disclosures, it was found that there is lack of opportunities for the public to assess and offer input into how government entities manage the mineral revenues received, and has led to frustration in mining communities and an anger at the lack of benefits citizens receive for the mining activities in their areas.
The situation has left local communities without the information tools to hold government entities accountable for what they do with this revenue.
Sadly, since the operationalization of Act 912 in 2017 there is very little to nothing to read about MDF reports and accounts to know how the MDF secretariat uses and disburse mineral royalties. Civil Society Organizations (CSOs), the media, academia and interest groups have no access to these information simply because the board is not in place to make them available.
It is against this background that we are calling on government to quickly put together the MDF board to fast track the performance of its functions. This would be the first step in rolling out key governance and public financial management steps towards managing and spending revenues from mineral resources.
As a reminder….. most citizens will remain “spectators” if they don’t get some of these very important information to demand accountability for their use. Active citizens are those who have vital information which enables them ask critical questions from duty bearers on.
Charles Othniel Abbey