Minority Caucus in Parliament has alleged that the New Patriotic Party administration has blown over Ghc179m of Ghana Infrastructure and Innovation Fund (GIIF) on Free Senior High School (SHS).
According to the caucus the use of the GIIF on none infrastructure projects contravenes the law establishing it.
Speaking to the media in Parliament shortly after the House debated the Annual Report on the Petroleum Funds for the 2017 Fiscal Year, the Minority Spokesperson on Finance and former Deputy Minister for Finance, Cassiel Ato Forson, called on the government to and amend the Act governing the use of the Fund.
Forson explained that his party is never against government funding the Free SHS program with petroleum funds but the right thing must be done.
He warned that the minority will haul the government before the law courts to address the issue.
“As people who have been charged to hold the government in check, we will not sit down to allow such blatant breaches of Act of Parliament,” he stated.
There has been heated debate over the usage of the Heritage Fund (HF) in the political space.
The Heritage Fund is a creation of section 10 of the Petroleum Revenue Management Act 815 enacted in 2011.
The purpose of the establishment of this fund is to provide an endowment to support the development of future generations when the petroleum reserves have been depleted according to Act 815 (2011) and amended Act 893 (2015).
The fund receives a percentage of oil revenue accrued to the Petroleum Holding Fund. In view of this Parliament of Ghana pegged this figure at 9%.
This means that out of the total oil revenue received into the Petroleum Holding Fund, the Heritage Fund receives only 9%. This amount is saved at the Bank of Ghana till oil reserves in the country have been depleted.
The remaining, 91%, goes into the Annual Budget Funding Amount (ABFA) and Stabilization Fund. 70% of this goes into the ABFA which goes to support the annual budget of the country whilst the remaining 21% goes into the Stabilization Fund which is used to cushion oil price in the event of oil price fluctuations.
The percentage of the HF as agreed by parliament can only be reviewed after fifteen (15) years according to section 10 (4) of the Petroleum Revenue Management Act 815.
According section 20 of the Act, the Heritage Fund can only be touched within a year after the oil reserves have been depleted.
The amount accrued to the fund together with the Stabilization Fund could then be lumped into a single fund called the Ghana Petroleum Wealth after which the former name will cease to exist. No withdrawals until after depletion of oil reserves. After 10 years, interest can be spent subject to simple majority in Parliament.
Source: Franklin ASARE-DONKOH
Writer’s email: email@example.com.