The Integrated Social Development Centre (ISODEC) has expressed disquiet over government’s announcement of subsidy on electricity tariff, describing the move as dishonest and insincere.
The Electricity Company of Ghana (ECG), confirmed to Citi Business News that Ghanaians will enjoy some level of subsidies with the first 50 units of electricity consumed attracting only 33 pesewas per unit including levies and taxes.
In addition, about 400,000 customers of the ECG who fall under the lifeline category of 50 units are expected to benefit, while those above will be charged only 67 pesewas per extra unit consumed.
But speaking to Citi Business News on the development, the Campaign Coordinator of ISODEC, Dr. Steve Manteaw maintained that government has not been truthful to Ghanaians due to a similar move it embarked upon in the past that brought the power sector on its knees as a result of government’s inability to pay back the subsidies.
“Subsidies are very crucial in protecting the vulnerable among us in policy making, but in this particular instance I do not think that government is very sincere in the sense that the legacy debt has arisen as a result of subsidies,” he said.
Questioning the rationale behind the decision, Dr. Manteaw argued that a similar move in the past resulted in ECG piling up debt due to government’s refusal to pay back the subsidies to the ECG.
“Government’s own explanation in imposing a 10 percent levy on Ghanaians recently is that it has accumulated debt over the period, the bulk of which were unpaid subsidies. So now we are not too sure if we should accept these subsidies,” he said.
He predicted that government will come back in the future to demand the subsidies from Ghanaians by imposing high taxes on electricity consumption.
ISODEC demands publication of funds
Touching on accountability in funds accrued from the increased taxes since January 2016, Dr. Manteaw demanded a publication of what have been realized since the taxes were increased.
“At the beginning of the year government imposed an energy sector levy of 10 percent, imposed on both petroleum products and electricity consumption. I think at this time it will make sense for government to come out and tell us how much it has collected in these levies and how much of the debt is left,” he argued.
Dr. Manteaw’s demand follows an earlier assertion made by the Deputy Minister for Power; John Jinapor that government has approved GHS200 million to the ECG to clear part of its debt.
He stated that government’s refusal to publish the figures has created doubts about its sincerity to clear the debt.
According to him, transparency will encourage Ghanaians to support government in clearing the debt since Ghanaians want reliable power supply.
He warned that the ECG risks going down in the same situation that led to the Tema Oil Refinery sinking in debt and resulting in its temporary closure.
By: Lawrence Segbefia/citibusinessnews.com/Ghana