The latest report by the Public Interest and Accountability Committee, PIAC, is damning with regards to the financial conduct of both the Ministry of Finance and the Ghana National Petroleum Corporation in particular. But while its criticism of GNPC is a matter of corporate conduct – even state owned corporate conduct – its revelations with regards to MoF are far more worrying.
Just as worrying is what has been left unsaid in the report itself, but which is obvious; the failure of government’s relevant institutions of state charged with responsibility to reel in poor financial conduct to do so. Indeed, it would be easy for government’s critics – although not necessarily correct – to allege that government is engaged in systemic financial malfeasance.
This because it is hard to excuse the failure of government to account for nearly GHc1.5 billion in officially unutilized petroleum revenues during 2019, more so considering that this is the third consecutive year in which monies meant to finance the budget were not used for that purpose and were also not accounted for.
To be sure government deserves the chance to explain why this has happened – its inherited fiscal situation was unenviable long before COVID 19 made it near impossible to navigate. However this is a country governed through the rule of law and the law demands for accountability and transparency in the management of public funds. Whatever the problem that led to the non-utilization and non-accounting for GHc1.5 billion in public funds, government is required by law to explain it to the citizenry.
Failure to do so opens government to accusations of financial malfeasance to put it mildly, and outright corruption to be most uncharitable. Being charitable, this newspaper stops short of making such allegations and asks government to simply account for the monies.
Then there is the issue of shortfalls in capital expenditure out of the petroleum revenues as required by law; only 54.86 percent of the revenues meant to be the Annual Budget Funding Amount went into capital expenditure, as against a minimum of 70 percent as required by law.
This is a matter of priorities, rather than lack of transparency and accountability, but it still contravenes the laws which must be adhered to. Simply put, if government lacks the fiscal space to spend so much on capital projects, then the law should be amended; until then it must be adhered to.
Actually, this legal violation raises a bigger question as to government’s commitment to capital expenditure, which indeed has been fuel for its critics since it assumed power in 2017. Every year, the capital expenditure budget has been slashed in order to keep within the fiscal deficit ceiling, which this newspaper regards as commendable fiscal responsibility.
However the contravention of legal requirements with regards to allocation of petroleum revenues on development projects raises questions as to the balance between social interventions that are recurrent and infrastructural development that is more permanent. Critics who insist that government’s current bureaucracy is too large and too expensive to maintain will point to the contravention of the legal requirements as to how petroleum revenues can be spent to buttress their claims as will those who insist that some of the social interventions amount to biting off more than it can chew.
This newspaper will not be drawn into such arguments here. We only ask that government abide by the laws just as it asks the rest of us to.