The Civil Society Platform on Oil and Gas (CSPOG) has asked the government to account for the unutilized Annual Budget Funding Amounts (ABFA).
A statement signed by coordinator of the CSPOG, Dr Se=teve Mantsew said the platform has taken due notice of a worrying development in the management of Ghana’s petroleum revenues, where substantial portions of the Annual Budget Funding Amounts (ABFA) have gone unutilised and unaccounted for, as per the 2016, 2017, 2018, and 2019 reports of the Public Interest and Accountability Committee (PIAC).
According to PIAC’s 2019 report, an amount of GH₵ 1.5 billion out of a budgeted GH₵ 2.8 billion earmarked for projects across the country was unutilised and unaccounted for by the Ministry of Finance. The amount in question is equivalent to more than half of the total ABFA allocation.
But CSPOG said its checks reveal that the anomaly also occurred in 2014 were GH₵ 666 million went unaccounted for. In 2016 the amount was GH₵77.7 million, in 2017 GH₵ 400 million, and 2018 GH₵ 251 million.
“ In the particular case of 2014, the unspent amount was swept by the Bank of Ghana, and became part of available government funds at the beginning of the next budget year. For the subsequent years, it is not clear what has happened to the monies even though the project oil revenue targets were met. The accumulated unutilised ABFA currently stands at GH₵ 2.8 billion.
“The Civil Society Oil and Gas Platform finds it difficult to rationalise the creeping trend of unutilised oil revenues at a time when a lot of uncompleted projects, earmarked to benefit from these revenues remain starved of funds, and the government keeps borrowing to finance the country’s development.
“Other concerns raised in the 2019 report of PIAC which require urgent attention and redress have concerns to do with the perennial failure of the National Oil Company, GNPC, to honour its cash call obligations in respect of its equity participation in the SGN field. GNPC, representing the Ghana Group, lifted only one cargo instead of three, due to its inability to honour its cash calls. The two cargoes were used to defray the Development and Production expenditures incurred by the SGN partners according to the 2019 PIAC report.
“CSPOG notes with pride, that, as much as US$ 30 million of oil revenues was invested in the construction of the Kotoka International Airport Terminal 3 through the Ghana Infrastructure Investment Fund (GIIF), and that this investment has yielded US$ 5.5 million returns in just three (3) years. The decision to invest some of the country’s oil money in Kotoka Terminal 3 was in line with Section 5(1)(b) of the Ghana Infrastructure Investment Fund(GIIF) Act, 2014 Act 877 which provides for the transfer of an amount not exceeding twenty-five percent of the Annual Budget Funding Amount (ABFA) to be applied to amortization and direct infrastructure expenditure.”
It added : “Unfortunately, as evident in the 2019 report, no allocation from the ABFA has been made to GIIF for the second consecutive year.
“CSPOG wishes to remind the government of the country’s commitment, following the discovery of oil in 2007, to ensure that oil revenue is applied significantly to our development priorities through dedicated governance framework and public accountability systems, given that our hydrocarbon resources will be depleted with the passage of time.
“The Civil Society Platform on Oil and Gas (CSPOG) on this score, calls on the government and the Ministry of Finance to ensure the prudent management and full accountability for the oil revenue entrusted in their care on behalf of the people of Ghana.”