The Public Interest and Accountability Committee (PIAC), an independent statutory body established under Section 51 of the Petroleum Revenue Management (PRMA) Act, 2011 (Act 815), says it has observed a loophole in allowing the Minister for Finance to place a cap on the Ghana Stabilisation Fund (GSF).
PIAC said there is no established criteria for the determination of the cap and use of proceeds for any official to place a cap on how much can be accrued to the Fund, hence can be subjected to abuse.
GSF is a fund into which portions of the petroleum proceeds are deposited, at the discretion of the Minister as necessitated by macroeconomic conditions; albeit with the approval of Parliament.
A statement signed by Chair of PIAC Nobel Wadzah on the launch of an issue paper on the management and use of petroleum revenues said: “The Committee also observes that over the years, some International Oil Companies (IOCs) have developed the practice of non-payment and deferred payment of Surface Rentals which is a source of petroleum revenue stream.
“This practice undervalues the Ghana Petroleum Holding Fund, and does not comply with the provisions of the PRMA.
“We note with concern that 10 years into oil, the effectiveness of an Investment Advisory Committee (IAC) is difficult to measure.
“The country is still stuck to the practice of investing in low qualifying instruments, a practice we believe can be better improved with a well-resourced, functional, and independent IAC. The advice of the IAC is not mandatory on the Minister for Finance, undermining the core essence of the IAC.
“It is important to note that though some of these issues have been consistently raised in the Committee’s annual reports over time, it has attracted little or less attention. 10 years into oil is an appropriate moment to reflect on how well or otherwise we have done with our oil.
“It is our belief that these issues will receive the needed attention among critical stakeholders. Mindful of the fact that our country’s resource governance is shaped by the thinking of political groupings (parties) and that these issues be given adequate attention in their manifestoes, policies and action steps.
“The understanding that petroleum is a finite resource, hence the need for effective governance must not be lost on us. Next year will mark the tenth anniversary of PIAC, and the Committee will roll out series of commemorative activities on the upstream petroleum sector and its governance.”
By Laud Nartey|3news.com|Ghana