Since its establishment in September 2011, the Public Interest and Accountability Committee, (PIAC), has effectively exercised its oversight responsibility of monitoring and evaluating the management of Ghana’s petroleum resources by the government and stakeholder institutions.
In compliance with provisions of the Petroleum Revenue Management Act (PRMA), 2011, (Act 815), the Committee prepares statutory Annual and SemiAnnual Reports, which aim at keeping Ghanaians and other interested stakeholders constantly informed about how the country’s petroleum revenues are managed and utilised.
Speaking at the coastal belt forum on Wednesday 9th December, 2021, at the GNAT Hall in Accra, on its 10 years of the management and use of petroleum revenue in Ghana, Chairman of the Public Interest and Accountability Committee (PIAC), Prof. Kwame Adom Frimpong, said for the period under review, despite the double blow of the COVID-19 pandemic and the associated oil price shocks on the economy and work programmes of major industry actors last year, the first half of 2021 witnessed sustained activity upstream.
Adding that, most IOCs resumed their project planning, execution, risk management and associated preparatory activities as well as drilling campaigns.
Prof. Kwame Adom Frimpong, said per their findings, PIAC recommends to the Ministry of Finance that, there is the need for the decision to find expression in the PRMA, which is being reviewed, with the necessary provisions as is the case with the ABFA and GIIF.
Following the decision of the Supreme Court of Ghana in the case of Kpodo and Another versus Attorney-General in 2019, that the District Assemblies Common Fund be added to the recipients of the Annual Budget Funding Amount to receive five (5) percent, an amount of GH¢129.26 million has been allocated to the Fund for 2021.
This, according to him, will enhance direct implementation and monitoring of ABFA-funded projects at the Sub-national level.
He disclosed that, instead of withdrawing from the Ghana Stabilisation Fund, the Government utilised an amount of GH¢40.17 million from the Treasury Main Account to shore-up the ABFA in the first quarter.
Prof. Frimpong, emphasized that, even though the PRMA allows the Minister for Finance to place a cap on the GSF, the Fund should be grown to serve its purpose of shoring up shortfalls in the Budget.
In December 2010, Ghana joined the league of oil producing countries. It successfully attracted a number of oil Exploration and Production (E&P) companies who have in partnership with the Ghana National Petroleum Corporation (GNPC) been at the fore front of petroleum production in the country.
The build up to the attainment of a decade of petroleum production was adversely affected by the outbreak of the corona virus disease (COVID-19) in 2020. Growth was subdued and a lot of exploration companies halted their production and expansion plans in Ghana.
With the introduction of the COVID-19 vaccines in the first half of 2021, global economic growth started to rebound, as most restrictions are gradually being eased and measures put in place to allow for work to continue.
In Ghana, the economy began to show signs of recovery in the period under review. The local petroleum industry witnessed some level of activities, albeit, slow.
The anticipation for the oil producing companies to ramp up production, and execute plans that were halted as a result of the pandemic also remained high.
An increased production output is thus expected to translate into more revenues needed to augment resources to manage the economy.
The management of the country’s petroleum revenues continues to be guided by the Petroleum Revenue Management Act, 2011 (Act 815) as amended, which seeks to provide the framework for the collection, allocation and management of petroleum revenue in a responsible, transparent, accountable and sustainable manner for the benefit of the citizens of Ghana in accordance with Article 36 of the Constitution for related matters.
The PRMA, however has two distinct features among others. These are; The intergenerational equity spending and savings, borne out of the recognition of the common resource ownership of current and future generations of Ghanaians, and appropriating 70 percent of revenue through the budget to address infrastructure needs given the country’s infrastructural deficit and its relevance for socio-economic growth and transformation.
This expenditure is defined as capital expenditure. The remaining 30 percent is ploughed into recurrent expenditure requirements.
Having already marked ten years of commercial oil production as a nation, the Public Interest and Accountability Committee (PIAC), a creation of the PRMA, is also marking 10 years of its establishment.
Section 52 of the PRMA created PIAC in September 2011 as a unique citizens based institution with an additional oversight responsibility to support the work of Parliament in ensuring the prudent management and use of petroleum revenues.
The Committee was given a three-fold mandate which is to; Monitor and evaluate compliance with the Act by Government and other relevant institutions in the management and use of petroleum revenues and investments; Provide space and a platform for the public to debate whether spending prospects and management and use of revenues conform to development priorities as provided under Section 21(3) of the Act; and,
Provide independent assessments on the management and use of petroleum revenues to assist Parliament and the Executive in the oversight and performance of related functions respectively.
Over the last 10 years, PIAC has been consistent with the release of its statutory reports.
The Committee since its inception has published a total of 20 reports. 10 Annual and 10 Semi-Annual Reports, covering the period 2011 to June 2021, with information and data from the Ministry of Finance, Bank of Ghana, Petroleum Commission, Energy Commission, Ghana National Petroleum Corporation, Ghana Revenue Authority, Ghana National Gas Company and the International Oil Companies.