VOTES AND PROCEEDINGS AND THE OFFICIAL REPORT
Hon Members, correction of Votes and Proceedings of Friday, 1st June, 2018.
Hon Members, correction of Official Report of Tuesday, 29th May, 2018.
[No correction was made to the Official Report of Tuesday, 29th May, 2018.]
Hon Members, item listed 3 on the Order Paper -- Statements. Hon Members, I have a Statement on World Environment Day, which stands in the name of the Chairman of the Parliamentary Select Committee on Environment, Science and Technology. Yes, Hon Member?
Thank you very much, Hon Chairman of the Committee for this brilliant research and for the presentation. Yes, Hon Member?
Thank you, Mr Speaker. I also beg to add my voice to the call for all of us to observe today's Environment Day with the theme; ‘Beat Plastic Pollution'. Mr Speaker, the sub-theme for Ghana is, ‘Reduce, Re-use and Re-cycle'. We are being called upon to re-visit the impact of plastic waste on our environment.
Mr Speaker, the fight against plastic waste especially, sachet water plastic had been with us since 2010, when a task force was established by the then Mayor of Accra to tackle the menace and get rid of it altogether. Mr Speaker, what we see today is a manifestation of the fact that, not much has been achieved despite the attempt to deal with the menace in the years far back. Mr Speaker, in 2015, the Ministry of Environment, Science, Technology and Innovation proposed that, from 1 st November, 2015, all flexible plastics produced and imported into the country should have the bio-degradable additive. That is, all flexible plastics below 20 microns produced in the country or imported should have these additives so that, they could bio-degrade on their own. Mr Speaker, what we see today is not what has been proposed; our gutters are choked. Only about 30 per cent of the importers comply with the addition of additives to the plastics. Our gutters are choked, mosquitoes are bred and floods occur everywhere. Mr Speaker, we cannot sit down, mourn and talk about this all the time. The time for action is now; and the action could start at various levels. Mr Speaker, it could start with myself and yourself. What are you doing in your home to stop plastic being mixed with your garbage, so that it would be very difficult for recycling companies to segregate and re-ycle the plastics? We could start from our homes. Just two weeks ago, I experimented it in my home; one small dustbin for the plastics and another small one for bio-degradable items. And what did I see? Reduced garbage, which is even more effective, makes it cheaper for one to dispose of. Mr Speaker, we must also contribute towards education; we start from schools, and we start from our communities. As Hon Members of Parliament, we could also embark on educational programmes. Mr Speaker, we could also help put dustbins at vantage points in our communities so that, people could easily segregate their garbage for effective management. Mr Speaker, we all stand the risk of getting diseases; diseases from eating contaminated foods when plastics get into the food cycle. Mr Speaker, I use this opportunity to call on all of us and state that, this is an emergency. This is something we must do now, it is not for tomorrow. Those who have been tasked or who have been paid to ensure that the gutters are not choked, that every place is clean of plastic wastes, that our beaches are clean, must also play their part. Mr Speaker, we are losing a lot regarding tourism. Nobody wants to visit a tourist site or a beach that is flooded or exposed to plastic waste all over. Everybody wants a very clean beach. When one goes to South Africa, one would see very clean beaches. Why can we not do the same? So, we are calling on all of us. It is not a duty for anybody, it is for all of us to make sure that, we get rid of the plastic waste. It is doable. Mr Speaker, with these few words, I want to thank you for the opportunity. Thank you.
Thank you very much, Hon Member. Yes, Hon Member?
Thank you Mr Speaker for the opportunity to contribute to the Statement. First of all, I want to commend the maker of the Statement for taking time to elucidate the House on what is happening as far as the environment is concerned. Mr Speaker, we all appreciate the challenges the country faces as far as the use of plastics is concerned. Years gone by, we rarely used plastics during the day. Most of our packages were made of paper bags, which are all bio-degradable, but we all know plastics are not bio-degradable, so, when they are disposed into the environment, it would never be degraded. Mr Speaker, the challenge facing the nation now is how we are going to handle this plastic waste. I know some countries have gone further in sanitising the use of plastics, others have gone to the extreme end of even banning the use of plastics. What is left for Ghana to do now, is what we want to do. Mr Speaker, I believe that the time to decide is now. We have all seen the dangers; when we go to our beaches, it leaves very much to be desired. And I think that the country must step up to the table to do what is right, so that we could have descent environments in the country. Mr Speaker, I would want to state that, even if we are not going to ban the use of plastics, we should ensure that we segregate plastics from other wastes so that we would be able to dispose of them properly. The situation whereby we combine plastic wastes with other wastes, which makes making it difficult for those who take the wastes to segregate them, is a challenge. Mr Speaker, in some countries, even the use of plastics goes with a cost. This is because they would need money to dispose of it. But in Ghana, we have not started anything like this. So I believe that we should try and instil more discipline into the system so that people would see that it is of no use to use plastics all the time, if not, we all know the dangers we are going to face as a country. So, I hope that the powers that be would take immediate steps to ensure that we are able to win the war against plastics. Thank you for the opportunity, Mr Speaker.
Mr Speaker, let me join my Hon Colleagues and the Hon Member who made the Statement to commemorate this very important day on our calendar. Mr Speaker, the problem that we must come to terms with, is the fact that, the world's natural resources are finite. Some of them are renewable, but most of them are finite. An example is petroleum resources. Plastic for example, is an item made out of petroleum products, which is finite. As we continue to advocate for sustainable lifestyles, we must also consider some limitations in the way we use certain materials. This is because, the raw materials from which they are made are finite.
Mr Speaker, I do not rise to contribute to the Statement. I was on my feet, but I did not catch your eye. The former Minister for Environment, Science, Technology and Innovotion in his contribution, stated that Hon Agyarko was the Ranking Member of the Committee on Environment, of the Sixth Parliament.
Hon Member, when the Hon Member on his or her feet resumes his or her seat, you cannot comment on what he or she said any more. Save that you may conjure a contribution and then preface your contribution with a reference for your future guidance. Otherwise you would be out of order. Hon Member, you may take his place. That one is gone. Dr Okoe Boye? I am supposed to take one each on both Sides. So that one is a non-est.
Mr Speaker, I rise to contribute to the Statement on the World Environment Day, especially with the focus on plastics.
One more contribution from each side of the House then the Leaders.
Mr Speaker, I am very grateful. This Statement is very useful, particularly, at this time when there are enormous concerns about the way plastic hamper our environment, especially, marine life. Mr Speaker, there are a few things that all of us would have to endeavour to do. One of them is, public education. We do not seem to have enough public education on the dangers of plastic waste to our society. So, I would encourage the Ministry of Environment, Science, Technology and Innovation to endeavour to speed up the campaign against the plastic waste menace in our society. This is because a lot of people are unaware of the scourge. Mr Speaker, there are companies which produce plastics that we should also engage. How can we get them to ensure that they produce materials that can be reused, so that they do not end up in the environment to hamper our water bodies? Mr Speaker, another significant thing is, a lot of us every now and then chew gum. Gum also has some element of plastic. If one goes to places like Norway, there are some places one cannot just drop a gum after the person has chewed it. The person would be fined. So, we must reduce the amount of gum we chew and the way we throw them about. This is because, they also end up getting clocked up in the ground. Mr Speaker, finally, I would like to emphasise on the bit to get households to sift the amount of plastic materials that they use. In various homes, they normally have bins where the garbage collectors would come and collect them after they are filled up. We should make sure that we have separate bins for plastics and separate bins for other waste materials so that recycling what has been used would become a lot easier. Mr Speaker, I would commend the maker of the Statement and would emphasise on the need for serious public education at our school level and in our various churches, even in the markets, where just about everything one buys at the market place comes with one form of plastic or the other. I believe if we encourage and educate people on the dangers it poses to us, our children and the future, people would begin to use materials that can be recycled instead of depending on plastic materials. Thank you, Mr Speaker.
Mr Speaker, thank you very much for the opportunity to contribute to the Statement. In doing so, I would want to take this opportunity to commend the maker of the Statement on World Environment Day.
Mr Speaker, we would take the opportunity for Hon Yieleh Chireh to speak on behalf of the minority Leadership. I thank you, Mr Speaker. Mr Speaker; Yes, Hon Yieleh Chireh?
Mr Speaker, first of all, let me thank the Hon Member who first made the Statement and also those who have contributed. We all seem to be talking about one thing and that is the environment and how it affects our health. Also, how we could keep this environment clean and ensure that, we live longer lives. And the courage we must have to bring policies that would ensure that we ban plastic materials? When any thought of banning plastics is raised, the argument is that, there are so many people in that industry so what would be the alternative? I do not believe that those people were born into those industries. It was available for them to make money. But making money at the expense of real life and the environment-- When we attend functions at our rural areas, we see plastic wastes all over; it is the same story when one goes to the riverbeds. I believe that we must pluck the courage as a country and as Parliament for us to ban plastic materials. Mr Speaker, I do not like it when people return from other countries, particularly, those that suffered war situations to tell us that, they have been able to stop people from producing plastics. Then everybody is encouraged to use paper to collect and carry away things that they buy from shops. What prevents us from doing same? Maybe, some interests are there but let us address them adequately. We need an environment free of plastics and this is why I would urge the two Ministries: Sanitation and Water Resources and Environment, Science, Technology and Innovation to bring that legislation for us to ban plastics. I thank you very much, Mr Speaker.
Hon Majority Leadership?
I thank you very much, Mr Speaker. I would want to commend the Hon Member who made the Statement for bringing before this House such a commemorative Statement on the World Environment Day being celebrated today. As Hon Colleagues have earlier enumerated, we all are aware of the hazards and pollutions that are caused by plastics in our country. The matter before us is not a matter of legislation because we have already enacted the Hazardous and Electronic Waste Control and Management Regulation, 2016 which is a handwork of this august House. So the issue is not about regulation, but as to how as human beings and people of this country we would change our attitude and be more innovative in how to use plastics and not make them pollutants but resource to the country. Mr Speaker, in other countries which are well developed, they convert plastics after their primary use into so many other things. Currently, plastics are being used for buildings and I believe that we should encourage the transformation of the plastic wastes into building materials since we have deficits when it comes to our housing sector. These are some of the innovative ways -- we are thinking of using mini-blocks for road construction. If we could convert these plastic wastes into some of these mini-blocks that could be used on our roads, it could also solve our road situation as a country. Mr Speaker, the issue is not about legislation or its implementation thereof, but attitudinal change. This country can gain a lot of foreign exchange as a result of tourism if our beaches were to be clean. It is sad how filth and plastic bags lie idle as we walk on our beaches. How on earth do we expect a tourist to come into this country and be attracted to these beaches?
I thank you very much. Hon Members, this is a matter that must be referred to the Committee on Environment, Science, Technology and Innovation to have a holistic view of it. Hon Chairman of the Committee, we would want that this matter be carefully examined by the Committee together with the Committee on Constitutional, Legal and Parliamentary Affairs. We would want to ensure that you closely examine whether there are any gaps in the law, the regulations and the approaches that we adopt towards this degradation. The House is of the same view that we cannot go on this way. Very often, Private Members Bills are jointly introduced by both sides of the House. If we apply this strategy, we would do something constructive in the interest of our nation. Others have done it, and we are capable of doing it. Thank you.
Hon Members, I have the pleasure to introduce to you a 6-Member delegation of the Natural Resources committee of the Parliament of Uganda who are on a four-day benchmarking visit to Ghana. They are here, among others, to benchmark best practices in the functioning of the committee on Environment, Science and Technology with particular reference to the passing of an environmental bill on climate change and management of pastics and e-waste. The visit is also intended to create the platform for networking between Members and our Ugandan counterparts with the aim of deepening relations between the two Legislatures. The delegation comprises the following: Hon Dr Keefa Kiwanuka -- Leader; Hon Bigirwa Norah -- Member; Ms Katono Susan -- Legal Cousel; Ms Akello Christine -- National Environment Agency; Mr Kasanga Allen -- National Environment Agency; Mr Opoti J. Denis -- Committee Clerk. On behalf of Hon Members, I wish them a fruitful stay and deliberations on environmental matters and others. Hon Members, we have a second Statement by the Hon Member for Akatsi North, on the need to establish a National Qualifications Board on the rising phenomenon of fake academic qualifications in the country.
Mr Speaker, thank you very much for the opportunity to make this short Statement on the rising phenomenon of fake academic qualifications in the country and the need to establish a National Qualifications Board to fight this canker. Mr Speaker, formal education began with the castle schools several years ago, by the missionaries and the merchants who needed the services of educated indigenes in the spread of the gospel as well as their trading activities. From a small beginning, formal education spread to the various corners of the country after Independence to the extent that greater steps by various governments catapulted access to formal education and carried us to where we have reached now. Mr Speaker, there is no gainsaying the fact that the education received by our grandparents in the castle schools and the mission schools in those days prepared them for life. That was what they handed over to us. Mr Speaker, this legacy has been eroded by the emergence of fake certificates awarded at various levels. It is interesting to note that quite a number of people are not ready to study to obtain certificates, but are ready to pay people to write examinations on their behalf and buy fake certificates. A few years ago, a verification exercise carried out by the Ghana Education Service revealed that a large number of people got employed with faked
Hon Member, thank you very much. Hon Pelpuo?
Mr Speaker, thank you for the opportunity to contribute to this very important Statement. Mr Speaker, the call by the Hon Member for us to have an identified way to certify those who are truly qualified and sieve out those who pretend to qualify is very important. If a country would develop, it is its critical human resource. We should have a critical mass of people who should have attained a certain level of education, skilled and capable to take up the duty of running the State. If these people are not properly trained and are accepted because they have fake qualifications, then it brings down the quality of the national effort to develop. So this call is very important and I support it. I would want to urge the National Accreditation Board to work very hard to ensure that we put in place a system that would recognise those who hold fake certificates as well as those who run fake institutions. So that we can have genuinely qualified people who would be responsible citizens, and we could entrust the destiny of this country to them. Mr Speaker, in the last count, the endless number of people holding fake Doctor of Philosophy (PhD) degrees was reported in the newspapers. It was so embarrassing -- there were pastors, and doctors working in the universities and very eminent people with PhD(s) were found to be holding fake university degrees. Mr Speaker, it is not just the fact that it is embarrassing, it is also criminal and unacceptable. So it is important that the nation and the Ministry of Education take this call seriously. I will be very happy if you can refer this Statement through the Ministry of Education to the National Accreditation Board (NAB), for us to have a conclusive discussion and a very firm position on it so that we do not have this embarrassing situation especially, when such people travel out of the country. Quite recently, somebody who had been working in one of our institutions for a very long time and holding a very important position was found to be holding a fake degree. So it is important that this matter is not taken lightly but rather we take it much more seriously. This is because it is killing the nation and has the potential to embarrass everybody and reduce the quality of the people we are producing. Mr Speaker, thank you for the opportunity.
Mr Speaker, thank you for the opportunity to contribute to the Statement on fake certificates. Just a quick one to bring our attention to the fact that a fake certificate can be a real certificate from a fake university. In the advent of the internet, where the institution does not even exist but would provide evidence that somebody has acquired the certificate from it. There are people seated somewhere and corresponding with people who want to verify the validity of the certificate in question. Mr Speaker, the second source of fake certificates is also from a situation where there is a fake certificate from a real institution and that is what we are aware of all the time. But both are problematic when it comes to any attempt to verify somebody's knowledge and skill base or the experience that the person has acquired. I believe that we know universities and other institutions that admit students who would want to move on to further stages, -- In the process of verifying -- but I believe that, the verification should be timely. At a point in time that somebody seeks admission, that is the stage we should have a system in place to verify the certificate, rather than allow the person to start from the first year through to the
Any contribution from Leadership?
Mr Speaker, the issue about fake certificates is becoming a global problem. It is not only in Africa or Ghana that we see this challenge. Though a developing country, we need to take it very seriously, because of the effects that it has on the opportunity of deserving people whose slots have to be given to those who do not deserve it. Mr Speaker, it can be acquired through two means; either one gets the real certificate from a fake university or a fake certificate from a real university. Meaning that, there are a lot of online -- [Interruption.] meaning one would have two fake certificates. The real challenge is that, recently, technology has made it easy for someone to sit in Ghana and have his or her education either through Harvard University, London School of Economics, Oxford University and so on. People take advantage of the ease of technology to make life comfortable, so we can do a lot of things without necessarily having to be physically present in those institutions. Mr Speaker, if, as a country, we do not take steps to combat this vigorously, we stand the chance of losing many opportunities. This is because today, the University of Ghana, Kwame Nkrumah University of Science and Technology, the University of Cape Coast and many other universities in the country offer distance learning education and it is one means that they are able to reach out to so many people in Ghana. They are able to educate people who acquire certificates that would ordinarily require their physical presence on the various university campuses. This is a very good thing, but the fear of fake certificates today is, people lose confidence in certification. If one asks anyone which institution they had their PhD and they mention that it was online, we immediately lose confidence in their certificates. It is simply because of this phenomenon of fake certificates that people are using the online programmes to do a lot of fake things. So the moment we hear someone say he or she acquired a genuine certificate through an online programme, we begin to be suspicious. Mr Speaker, in London, and even in South Africa, as the maker of the Statement rightly mentioned, they have this Board that helps in the verification of people's certificates. In Ghana, if it is the Basic Education Certificate Examination (B.E.C.E) or the West African Senior School Certificate Examination (W.A.S.S.C.E) you could easily go to the West African Examinations Council (W. A. E. C) to cross- check those certificates but anything beyond these becomes a challenge. This is because like the maker of the Statement rightly said, it is not the mandate of the Ghana Education Service (G.E.S) which tries to take steps to help in the verification. Mr Speaker, my worry is whether we should create another State institution just to do this or we should look at the current existing agencies that provide services that are in line with this, so that we amend their Act and add this to their functions. The one that readily comes to mind is the Natioanal Accreditation Board (NAB). Whether we should not amend the Act that established the NAB to add this as a core function. Mr Speaker, this is because, technology has made it so easy today, that by simply acquiring software system, such that the moment one wants to cross- check, one could go for the applications, then do the verification himself without necessarily having to go to those institutions physically. This is a major challenge. In the field of medicine and et cetera -- others have decided to take the certificate of someone they might have been aware had been through the university, to say that they are medical doctors and they practice till they are caught along the line. The one that comes to mind easily is the recent case at the Koforidua Technical University, where a lecturer had been lecturing for nine years. Apparently, they later found out that, he was all these years lecturing with a fake certificate. Mr Speaker, as a country, we need to sit up because, even in our universities, sometimes we get students who get to their third year before the university comes out to say that they have cross- checked and their results are fake, therefore they are withdrawing them. When these students are withdrawn, they just ask them to leave the campus. I believe when that happens, it is a criminal offence and they should be handed over to the Police so that while they are dismissing them, the Police and for that matter, the criminal system will deal with them. Mr Speaker, but all that they do is to simply withdraw them from the university and that ends it. Mr Speaker, recently, when the security agencies did their recruitments, so many people came with fake certificates. Mr Speaker, the way this phenomenon is on the rise, we risk having our children and grandchildren think that would be the easiest way to acquire certificates, and so they would do very little and use moneys to acquire certificates, because it has become so common to do. Sometimes they design it themselves and I believe that we need to look at this. Also, as I said, the National Accreditation Board Act could be amended to include the certification of all certificates, whether it was brought from abroad or received in Ghana. Mr Speaker, I believe this would do us a lot of good.
Thank you very much. Hon Majority Leader, any comments?
Mr Speaker, no comments.
This ends Statements time. Hon Members, at the commencement of Public Business: Item numbered 4 on the Order Paper -- Presentation of Papers.
Mr Speaker, the Hon Deputy Minister for Energy is with us and if you would indulge him, he would lay the document on behalf of the Hon Minister for Energy. Mr Speaker, the Hon Minister for Energy is at Cabinet now.
Hon Deputy Minister for Energy, you may lay the Paper.
Item numbered 5 -- Motions. Hon Chairman of the Committee?
Hon Chairman, thank you very much.
Mr Speaker, I rise to second the Motion, but let me first make an observation. Mr Speaker, unfortunately, it looks as though there is nobody from the Ministry of Finance — the Hon Minister is not here and none of his three Deputy Ministers are here to debate such an important matter for the State. Mr Speaker, this is not the first time of the Hon Minister for Finance --He does not come to the Chamber. I do not see him very often, and most often, when we debate issues his deputies are not here, but better still, I would go straight to the point and bring out my concerns. Mr Speaker, if you look at page 16 of the Annual Public Debt Report for the 2017 financial year submitted to Parliament by the Hon Minister for Finance, Mr Ken Ofori Atta on 23rd March, 2018, you would notice in item 23 that, the public debt as at 31st December, 2016 was GH¢122.3 billion. As at 31st December, 2017, the public debt increased to GH¢142.6 billion. Mr Speaker, indeed, this amount ex- cludes the Energy Sector Bond of GH¢4.7 billion that was recently issued and also the UT Bank and Capital Bank bonds of about GH¢2.3 billion. So, if we are to add this UT Bank and Capital Bank bonds and the Energy Sector Bond, the public debt as accrued for the year 2017 would be US$149.6 billion, which is approximately, GH¢150 billion.
Hon Chairman, do you rise on a point of order? Question proposed.
Mr Speaker, it is rightly so. The Hon Ranking Member is grossly misleading the House. If the Hon Ranking Member cares to know, we are debating the Annual Debt Report for the year 2017. The UT Bank Bond he spoke to, was issued in the year 2018. So, why does he add debt for the year 2018 to a debt for the year 2017 when we are debating the 2017 Report? We are debating the 2017 Annual Debt Report. In the UT Bank a Debt of GH¢2.2 billion was issued in April, 2018. Please, he should stick to facts and figures as contained in the 2017 Annual Debt Report.
Thank you. Hon Ranking Member?
Mr Speaker, I made reference to two key bonds that were issued. Firstly, in the Energy Sector Bond, GH¢4.7 billion was indeed issued in the year 2017. Again, the UT Bank and Capital Bank bonds accrued in the year 2017. I used the word “accrued”. There is difference between accruals and cash, and I am talking of accruals. That was why I made reference to accruals.
Mr Speaker, let me continue.
Hon Ranking Member, the Hon Chairman has risen on a point of order. Go on.
Mr Speaker, again, he said the Energy Sector Bond of GH¢4.7 billion issued in 2017 is part of the stock
Hon Members, order!
Mr Speaker, the government created a special purpose vehicle; Energy Sector Levy Act (ESLA) public limited company, which issued the Bond. That debt sits on the books of ESLA public limited company and not on government's books. Mr Speaker, I would urge the Hon Ranking Member once again to --
Hon Member, just a moment.
Hon Ranking Member, that was not to invite you. That was to ensure that there was order. I believe we could have an intellectual discourse, one after the other. [Interruption.] The Hon Member who is still talking, do you want to take over? I am particularly unhappy with that kind of debate. Hon Chairman, you might make your point.
Mr Speaker, if he would want to speak to the public debt situation, yes, they left it at GH¢122 billion. At that time, the debt stock had increased to 36 per cent per year. For the year 2017, the debt stock grew at 13 per cent. So, it has grown from GH¢122 billion to the GH¢140 billion he talked about. He should not try to pile on the debt. By saying the ELSA debt is not part of the public debt -- the Energy Sector Bond was issued in 2018. So, let us stick to the figures provided in the 2017 Debt Report.
Hon Ranking Member, you may continue.
Mr Speaker, I wish to caution my Hon Chairman of the Committee that his statement today might amount to misreporting on the part of the Government of Ghana. The International Monetary Fund (IMF) and the World Bank has reported on their webpage and in their booklet that the Energy Sector Bond is part of Ghana Government's Bonds. Mr Speaker, what is he talking about? My argument is that, we should understand that the Energy Sector Levy is an Act of Parliament.
Hon Chairman of the Committee? Hon Ranking Member, he has been called. You made your point.
Mr Speaker, again, the Hon Ranking Member said that the IMF reports the Energy Sector debt as part of government's debt, it is untrue. In the IMF Report, it is a footnote. [Laughter.]
Order! Hon Members, there is nothing laughable. I refuse to accept that there is anything laughable about this. A footnote is a further explanation of any content. Listen to that first. If you do not listen to that, how could you make a judgement by laughing it off? I am not amused by this mode of debate. Whether it is a footnote or what, it could be a further and deeper explanation of that which is in the main text. Hon Chairman, please, go on.
Mr Speaker, so the 69.8 per cent debt to Gross Domestic Product (GDP) ratio that we have now is the state of our public debt. As a matter of fact, we brought it down from the 73.1 per cent they left it. Mr Speaker, there is a threshold, which is 70 per cent, beyond which one's debt is unsustainable. Mr Speaker, I have presented the Annual Debt Report for 2017. That is what is before the House. So for him to bring extraneous matters and try to pile on the debt -- They left it at GH¢122 billion, we have only increased the debt stock by 13 per cent in a year. So respectfully, I would urge my Colleague, the Hon Ranking Member, to speak to the 2017 Annual Debt Report which is before the House.
Hon Deputy Minority Leader?
Thank you, Mr Speaker. Mr Speaker, the trend of the point of order by the Hon Chairman of the Committee is becoming a banter between him and the Hon Ranking Member. He
Hon Member, knowing your abilities, I thought, perhaps, you would help us to correct whatever might be said to be misleading.
Mr Speaker, thank you very much for your explanation. Mr Speaker, if the Hon Chairman of the Committee disagreed with the Hon Ranking Member, and the Hon Ranking Member also stands on his point, then it is going to be a banter between the two of them and we would not close from here today. That is the point I am making --
But Hon Member, you see, particularly, when it comes to certain figures and such matters, sometimes it is alright if we allow the two parties to go into some detail, so that we can all come to a full realisation of the issue, so banter or not, let us continue. Hon Member, you may continue.
Hon Majority Leader, did I not recognise you? You may make your point.
Mr Speaker, I agree that if an Hon Member contributing to a debate misrepresents some facts, any Member, even if he has spoken to the issue before, could rise and challenge the veracity of the presentation of the Hon Member on the Floor. Any Hon Member could do that, and it is allowed by our Standing Orders. I am just appealing to the Hon Chairman of the Finance Committee, for the purposes of allowing the smooth transaction of business and debating this all important matter, I believe that the Hon Chairman could perhaps write down the issues and respond later to them. That would allow the smooth conduct of debate. Mr Speaker, however, I agree that by our Standing Order 86 (5), if an Hon Member speaks to an issue and the person contributing on the Floor misrepresents facts, the Hon Member who had spoken earlier could get up and challenge it. That is allowed by our rules. But just so that we encourage a smooth flow of the debate, I am appealing to the Hon Chairman of the Committee to restrain himself, listen to everybody, and where nodal issues are raised which we could challenge, he could come out later and rebut them.
Hon Member, you may continue.
Thank you Mr Speaker. Mr Speaker, footnotes are part of Reports. They are normally there to explain certain contents of a Report, which ordinarily, the reader of the financial statement may not understand. So footnotes are provided to give further guidance and information to readers of financial information. So Mr Speaker, footnotes are part of the Report. Mr Speaker, let me also say that from the information that I have here, the public debt has increased from GH¢ 122.3 billion as at 31st December, 2016 to GH¢ 142.6 billion as at 31st December, 2017. Mr Speaker, I made a point that this amount excludes the Energy Sector Bond and the UT Capital Banks bond. If you are to add this, that amount would increase to about GH¢ 150 billion. This means that the public debt has increased by GH¢ 28 billion within twelve calendar months. This means that every single month, we accumulate a debt of GH¢ 2.3 billion. Mr Speaker, you would notice in the Report, if I may make reference-- In the Report, as at the year 2017, the Ministry of Finance signed additional loans of US$506 million, as new commitments. These are yet to hit the Central Government as debt, because as we speak, we have only signed them, we have not drawn down. Until we draw down, it would not become a debt. So in our debt sustainability analysis, we would capture them as future debts or a flow that is yet to hit the Central Government. My caution is that, if you are to convert this in today's exchange rate of 4.7 to the cedi, then it means that approximately, we are going to add, in the course of the year, a debt stock that is going to increase to the level of GH¢ 170 billion. Mr Speaker, my concern is that, the rate at which the debt is increasing, we should tread cautiously and be careful, because clearly, in future all of us would have a responsibility to service this debt. Mr Speaker, secondly, let me take you to page 30 of the Committee's Report. If I may take you to item 52 of the Annual Public Debt Report for the 2017 Financial Year, you would notice that the review of existing on-lent and guarantees, it says that as at the end of 2017, government on-lent GH¢ 9.3 billion, equivalent of US$2.1 billion to State Owned Enterprises (SOEs), out of which GH¢8.4 billion, approximately, US$ 1.8 billion has been disbursed. The total debt service due and not paid as at the end of December 2017 was GH¢ 1.3 billion or approximately US$ 286 billion. Mr Speaker, this is not good enough. Clearly, this country has gone for commercial loans and on-lent them to our SOEs. Approximately, we have borrowed an amount of GH¢ 9.316 billion. Out of the GH¢ 9.3 billion, total disbursement is about GH¢ 8.4 billion. Out of this amount, total debt service due is about GH¢ 1.2 billion. Mr Speaker, unfortunately, the SOEs have only serviced GH¢ 29 million out of GH¢ 1.26 billion. This cannot be good enough. It is about time we encouraged our SOEs to be responsible and service the debt that this Honourable House has approved for the SOEs to perform their functions.
On a point of order. Mr Speaker, with respect, I stand on a point of order. My respected Hon Colleague in his submission is misleading the House on the issue of public debt. Mr Speaker, I have said this, and I repeat one more time, that our Supreme Court has made a ruling to the effect that, debt incurred by SOEs and other institutions of State, although these institutions are owned by the people of Ghana, these are separate and not part of public debt. The issue of on-lending -- [Interruptions] -- please, listen to the law, with respect -- Mr Speaker, on the issue of Karpower, clearly, government was guaranteeing and eventually, if ECG defaults and GNPC fails to pay, it is the Government of Ghana, but the Supreme Court held in the Dr Assibey-Yeboah case that, that is not part of public debt. So I agree if my Hon Colleague argues that these are worrying issues, but if he says that these are public debts, I beg to disagree, fortified by the law. And that is the point I would like him to make clear in this House, because there is a ruling on this matter. Mr Speaker, I thank you so much.
Hon Member, please go on.
Thank you, Mr Speaker. Mr Speaker, my Hon Colleague got worried because I mentioned Ghana Water Company. Mr Speaker, these are not debts that the SOEs themselves went out there to contract. These are debts that the Central Government borrowed through an Act of Parliament, and then on-lent to the SOEs. Mr Speaker, I made reference to the Annual Public Debt Report submitted to Parliament by the Hon Minister for Finance on the 23rd of March, 2018. If my Hon Colleague would mind, I would read it to him. On page 30 of the Report, item numbered 52, Review of Existing On-lending and Guarantees -- with your permission, I beg to quote: “As at end 2017, Government had on-lent GH¢ 9.3 billion (US$2.1 billion) to SOEs.” So, it is Government of Ghana which lent it to them -- [Interruption.] -- Please, take your time, listen to me, let me finish then you could make your point. This is no law; I am making reference to finance.
Hon Member, there are styles for debate. You said, “If my Hon Colleague would permit.” Who permits here? You are turning it into a personal address to him. So I was waiting for you to have your response. Would you kindly address the Chair as we do in Parliament? Please, go on.
Thank you, Mr Speaker. I was making a point and I will continue with it. Mr Speaker, the total disbursed amount that the GoG went out and borrowed to on-lend to Ghana Water Company Limited (GWCL) was GH¢ 3.9 billion. Total debt service due is GH¢ 133.8 million. Out of that amount, only GH¢20.1 million has been paid. Among the list of SOEs, GWCL is the best performing company. Mr Speaker, if you take the likes of Metro Mass Transit Limited (MMT), GoG went for a loan of GH¢ 104 million, and out of the amount, GH¢ 104 million has been drawn down. The total debt service due is GH¢ 41.1 million. They have paid only GH¢ 1.4 million. Again, GoG went for a loan of GH¢ 72 million and on-lent it to State Transport Corporation (STC). Debt service due is GH¢ 4 million. They have failed to pay a cedi. I do not believe that is good enough. Unfortunately, when we talk about public debts, it includes all of these amounts. If care is not taken, a time would come when this Honourable House would have to pass a tax measure, which we would end up being used to service these debts, because the SOEs are not responsive or responsible enough. Mr Speaker, I would request that we bring the Chief Executive Officers of the SOEs to this Honourable House to answer questions as to why they are failing to honour these debts.
Hon Majority Leader and Hon Minority Chief Whip, do we bring Managing Directors before this Honourable House? Order! -- Leadership, I am throwing this to you. Under our rules, do we bring Managing Directors to the House to answer questions? I am just talking about the practice.
Mr Speaker, except that they do not respond directly to the House. The House, in plenary, cannot invite them. A committee of the House could invite them, but they do not respond to us in plenary.
When we make certain statements, I just want us to know what we are saying. We do not normally bring Managing Directors to come and respond to matters in this House. Yes, Hon Minority Chief Whip?
Thank you, Mr Speaker. As the Hon Majority Leader said earlier, when there are pressing issues -- this House has done it before.
Hon Member, it is good for Leaders, when Hon Members have good intentions towards something, but they do not say it accurately, to advise them. This is because it was said twice. I heard it at first, but I kept quiet. I do not want the impression to be given that, this is our procedure, therefore, since it has been repeated, I want the Hon Leaders to educate the House even before I come in. That is not our practice. One more from each Side of the House then the Hon Leader would conclude.
Yes, Hon Member?
Thank you, Mr Speaker, for the opportunity to contribute to the Motion on the floor. Mr Speaker, before one knows where he is, he has to know where he is coming from. This government inherited an economy whose indexes had gone haywire, and the government, through the Hon Minister for Finance, promised the people of Ghana that they would stabilise the economy. Mr Speaker, going through the Report, with your permission, I beg to refer to item numbered 4 -- we can see the performance of the Government in 2017. Inflation rate at the end of 2017 had dropped to 11.8 per cent from 15.4 per cent in 2016. The growth of the economy at the end of 2016 was 3.7 per cent. By the end of 2017, growth went up to 8.5 per cent. Mr Speaker, if we take the public debt, for the first time since 2007, this government managed to reduce the debt to GDP ratio at the end of 2017 from 73 per cent to 69.8 per cent. This shows that the government is on the right path. The least this House could do is to applaud the government and urge it to do more. Obviously, we have not got to the end of the road yet, but we must acknowledge the fact that, there has been immense improvement from where the government picked the economy at the end of 2016. Mr Speaker, I believe that, this Government has shown that it is committed to sanitising the economy of this country. We believe that, more would be done in the course of the year 2018. Mr Speaker, crime rate has consistently reduced in the year, 2017. This has also helped to reduce interest rate in the country. When that happens, it means the business community would be enabled to borrow more, so that they can expand the economy. So who would not say this is better? I think the government has done well looking at where they picked the economy from. We must applaud this government -- [Interruption.] -- No wonder the President said that the Hon Minister for Finance is an asset to the nation.
Thank you very much, Mr Speaker. I rise to support the Motion and in so doing, to draw the attention of this august House to point 4.12 of the Report, which speaks about the interest payment burden that we have as a country. Mr Speaker, the fact that the Report actually identifies that we now use about 35 per cent of the total revenue that we generate, as a country, to take care of our debts shows that the journey we are on, is really becoming a perilous journey, not just for the current generation, but, especially, for the future generation. Mr Speaker, what it means therefore is that, we need to try to be sober in relating to this discussion and try as much as possible to tone down on what I call the partisan rhetoric, in order to face the real difficulty which is facing us. Mr Speaker, we need to also remember that we are talking about rhetorics to the effect that, Ghana actually does not even need borrowing in order for us to have development; that the money is right here and we do not need to depend on borrowing. That was said by the current Vice President. Mr Speaker, now, if we remember this particular line, it makes it even all the more worrying that, within the space of a year, we have been able to add this much to the public debt stock. Mr Speaker, personally, I do understand that,. it is difficult to have development without borrowing. But if we look at the Party that made this rhetoric, then there is the need for a certain ‘eating of the humble pie' to make an admission that, ‘‘listen, we have got it wrong; we have come to office and we have realised that we cannot make the development without borrowing''. Mr Speaker, obviously, this borrowing shows that, that rhetoric was really not well-thought through; it was done on the spur-of-the-moment, and there is the need for that admission to be made. Mr Speaker, now, having said so, let me move to something even more substantial. It is one thing to borrow in order to develop your economy, build the infrastructure to generate the necessary future returns that would enable you to
take care of those ones; it is another thing to actually do this borrowing and actually have nothing really in terms of real critical infrastructure to show. That is where the worry is. Mr Speaker, the worry is the fact that, you can talk about the group which borrowed and if you want to ask what was done from it, you can point, for example, at the Aboadze Thermal Plant in the Western Region. That is actually an indication of what borrowing is being used for. Mr Speaker, you can talk about borrowing and point to the hydro infrastructure that was put in Kpong to supply water to, virtually, a part of Accra that for twenty-five years never saw it. Mr Speaker, you can talk about US$1.5billion, which is being used for expansion in Tema Port today. You can talk of the same in Accra Airport and so many other places. Real critical infrastructure. Mr Speaker, today what do we have? We have a very unfortunate situation where money is being borrowed, but, a lot of that money is simply going into consumption. That is destroying the very future of our country. Mr Speaker, now, if you are talking about 35 per cent of government revenue having to be used to take care of debt, and you are not able to use that money for proper infrastructure and the development of our country, then, it is going to become even more difficult to raise the necessary future revenue to take care of these debts that we have accrued. So it is important for us, as a country, to really get worried about where we are going. It is very important. Mr Speaker, I would also want to say that if it is that we truly intend to have a Ghana beyond aid, then we need to really start to walk the talk. At the moment, that is not what we are doing. Mr Speaker, last week we saw a similar situation when we were discussing how we were using the Annual Budget Funding Amount (ABFA), which according to law, majority of it is supposed to be used for critical capital expenditure. This is exactly what it is; a chunk of it is now being used to pay school fees. I am saying that it is true that every government has its priority. The New Patriotic Party's priority is to use a lot of that to be able to pay school fees. The government decides to call it ‘Investment in human capital'. Mr Speaker, I get worried. The worry I have is this, in every family, in order to sustain the family for the future, especially the children, real care must be taken. The business of that family, first and foremost must be taken care of. If you use all your money simply to pay school fees, and you are not able to expand your business, a time would come when this finite resource in the form of oil would get depleted. What other money is going to be available to pay any school fees for the children? Mr Speaker, I am putting these together with the whole debt conundrum we have now; that we need to have a serious conversation, going forward and start toning down on the need — Mr Speaker, this is because, the way I look at it, it is looking increasingly more like ‘let us do this in order to secure votes tomorrow' as opposed to let us do this in order to secure the future of our children and the future of our country. That in my view, is worrying. Mr Speaker, so I really want to support the Motion and simply say that, for the first year that we are talking about, whether it is a debate over GH ¢24 billion addition or GH¢28 billion addition, there is a fact that, there has been substantial addition, and this has been accrued over a period of a year. Mr Speaker, after all the rhetorics that we do not really need to borrow because there is enough money in Ghana for us to raise, clearly, we have made a departure from that.
Mr Speaker, so it is important that we put much more emphasis, not just on borrowing, but borrowing for the critical needs of our future development as opposed to continue to consume and tomorrow, there would not be enough money to take care of this nation. Thank you very much, Mr Speaker.
Leadership? --[Pause.] The Hon Chairman may conclude after the Leaders have contributed. Minority Leadership, you may contribute.
Mr Speaker, we think that this is a very important issue—
Hon Member, look at the Order Paper, very equally important things are there, and we are going— Leaders, please—
Mr Speaker, I would ask the Hon Member for Bolgatanga Central to take the place of Leadership.
Yes, Hon Member?
Thank you very much, Mr Speaker. I believe the debate around our public debt is such an important issue that goes to the core of building the capacity of this country in creating the resilience of the economy that would survive turbulent times over the years. As a result, anytime we see a debt report that demonstrates a substantial increase in public debt without a corresponding increase in the physical infrastructure of our country, then, we must get worried. Mr Speaker, I have looked at the Report submitted by the Hon Minister for Finance and I have looked at the Report of your Committee, and something very striking has caught my attention. Mr Speaker, you would recall that last year in April, we had cause to invite the Hon Minister for Finance to appear before this august House to answer the specific Question on US$2.25 billion. Mr Speaker, you would recall that, the Hon Minister for Finance informed us that the amount of money which was the
equivalent of GH¢9.7 billion was entirely to reprofile our public debt. He made it emphatically clear that the money was meant to reprofile our public debt. I would want to refer to page 28, paragraph 47 of the Hon Minister's Report. He alluded to the fact that, only GH¢4.2 billion of our public debt was reprofiled out of GH¢9.7 billion. He came before this House to tell us what was meant to reprofile the public debt. As a matter of fact, GH¢5.5 billion of the money in my view, is what was accounted for in our reprofiling. [Interruption] I would want this House to take it very seriously because the Hon Minister appeared before us and assured us that the money would go nowhere but reprofile our public debt. He needs to account for the GH¢5.5 billion that is not being used for the reprofiling of our public debt. This is because, he indicated on paragraph 47 that only GH¢4.2 billion of that money was used for public debt profiling and that is a very serious matter we need to check. Mr Speaker, we were told by this Report that the public debt rose purely on account of an increase in our domestic debt. I want to refer to the second paragraph of the Report on page 5. Which I beg to quote: “This rise in nominal domestic debt stock is attributed largely to increase domestic borrowing to finance the budget deficit in 2017.” I would want to disagree with this position of the Hon Minister for Finance to the effect that the public debt increased on account of only the domestic debt. Mr Speaker, our external debt stood at GH¢68.9 billion per his own Report. By the end of the year 2017, it had increased to GH¢75 billion. This is a 10 per cent increase of GH¢6.9 billion additional external public debt. Meanwhile, throughout 2017, the rhetoric was that, we only borrowed internally and not externally. How could non-borrowing externally lead to an increase of about 10 per cent in our external public debt by GH¢ 6.9 billion? Where is that GH¢ 6.9 billion? We did not borrow anything externally but we see a GH¢ 6.9 billion increase in our external debt. Somebody should explain how this figure came about. This is because external borrowing requires the approval of this august House. Therefore if the State went about borrowing externally without the approval of this House, that requires very serious interrogation. This must be taken very seriously and somebody must answer for this anomaly. Mr Speaker, if you consider the total amount of money that was borrowed, per the Report that was issued, our total public debt was increased to about GH¢142.6 billion from a figure of GH¢122 billion. Mr Speaker, if we decide to do away with all the concerns we have and decide to agree with the Hon Minister's Report, this means that, our public debt would have increased by about GH¢20 billion. If our public debt increased by GH¢20 billion, what it simply means is that we have accumulated an additional GH¢20 billion. The only way this would not go into our deficit is that, money sat somewhere for liability management. We have been told in the Ministry's Report that, only GH¢1.1 billion was spent on liability management. So where is the additional GH¢18.6 billion? Yet, we have been told our deficit is only GH¢12.2 billion. That cannot be. So which GH¢6.8 billion is not in our deficit or liability management, is missing? Where is it? Clearly, our deficit has been understated by GH¢6.2 billion. If we add that figure, we should be looking at a budget deficit of about GH¢18.6 billion. That cannot give us a 6 per cent of GDP. That should give us somewhere in the region of 10 per cent. So somebody should explain why these numbers simply do not add up. Mr Speaker, there are more questions than answers with respect to this Report. It tells us that, GH¢5.5 billion which was spent for reprofiling is unaccounted for. This Report tells us that, the additional GH¢6.9 billion which was borrowed externally was not accounted for. Again, it tells us that the GH¢6.9 billion did not find its way into the National Budget to influence our budget deficit. So our budget deficit has been suppressed and all the numbers touted around are not the true numbers. They should come and tell us the true state of our deficit and we would be very glad to interrogate those numbers. Otherwise, things just do not add up. Mr Speaker, there have been very recent developments in the analysis of Ghana's public debt to GDP and today, I want to take the opportunity to explain this once and for all. Every time, we are told in January and February that we have reduced debt to GDP from 69 per cent to 60 per cent -- I have never seen anywhere in Economics and in Finance that, you could take a year earned GDP figures to debt and come to January and reduce it. It is never done. At the end of the financial year, you look at your total debt from January to December which is your actual GDP accumulated. That gives you your debt to GDP. At the beginning of the year, you do not know your GDP for the end of the year, except it is projected. So that projected GDP becomes constant from January to December. Yet your debt would now accumulate over the year. That is why. Mr Speaker, in December 2014, Ghana's debt to GDP stood at 70.2 per cent. By February 2015, it was 62 per cent. Yet we never said we had reduced our debt to GDP from 70 per cent to 62 per cent. By the end of the year, it rather increased to 71 per cent.
Order! Order! Hon Member, do you stand on a point of order?
Mr Speaker, respectfully, I have a PhD in Economics. [Interruption] Every time he is on the Floor, he says that somebody does not understand Economics.
Mr Speaker, this trajectory -- He should stay away. He is a student, yet stands in the House to say that somebody does not understand Economics and he knows finance. [Interruption.]
Mr Speaker, in 2016, here in the House, Hon Seth Terkper told us that the debt to GDP ratio had gone down to 64 per cent. The same technicalities. If in February we want to calculate the debt to GDP ratio and we know the GDP, is it not the end-year GDP we would use? So it would always reduce. When we state debt to GDP ratio in February, we would use the end-year GDP. When we state it in March, we would use the end-year GDP. So what is this idea of in March, the debt to GDP ratio is lower and at the end of the year -- That is how it is always calculated. He should go through all the Reports, that is how it is always calculated. When he comes to contribute here -- he does it on radio, trying to establish that he knows -- [Interruption] -- He should stay away from that kind of debate; it does not help. I am advising him at the same time. I know both him and the Hon Ranking Member are students, yet they come here to tell us that -- [Laughter.]
Hon Member, please conclude.
Mr Speaker, I am sure when I come back in the next world and I choose to do Agriculture Economics, then he would teach me — [Laughter] — But for now, I am far away from there and I am not coming anywhere near Agriculture Economics. So please, when I come to study Agriculture Economics, I would come to his class. Mr Speaker, there is a difference between knowing and understanding Economics and making sure that one lives by what he knows and understands. Nobody reduces debt to GDP in February. It is simple. If he knows of any economic module that reduces debt to GDP in the course of the year, then he should tell me. How do we compare actuals to projected and we say we have reduced? Mr Speaker, in any case, do we normally adjust GDP as and when the economy is performing or when it is underperforming in the course of the year? At the end of the day, the truth is that, this propaganda of them reducing debt to GDP in January, February, March and September must stop. This is because students of Economics and Finance are listening and it is our responsibility not to mislead them. Mr Joseph Cudjoe — rose --
Yes Hon Member you have the floor.
On a point of Order. Mr Speaker, it is important for the records. The Hon Member should correct his statement because he ended by even saying that students of Finance and Economics are listening. He said that when one borrows, the only way it would not affect the deficit is for the money to sit somewhere — [Uproar.] That is what he said. Mr Speaker, without telling us what the performance of revenue was, making pronouncement on deficit from borrow- ing, he should correct that else he is misleading the House.
Mr Speaker, when one borrows for a country, it is borrowed either to finance a deficit or to keep it with the purpose of financing maturing debt obligation. The only way one would report that figure, which is not in the deficit, is to report same as funds set aside either for liability management or for buffers. We do not have in this Report, an amount of GH¢ 6.2 billion which is set aside for liability management or to build buffers for the future. Therefore that Mr Speaker, we have been belabouring this point about energy debt. In the prospectus that we used to issue this Bond, the State committed to 900 million letters of credit from a Development Finance Corporation to guarantee the debt. Again, we took a cash cap commitment of GH¢ 600 million from the sponsor, all becoming contingent liabilities on the State, just to ensure that, if Energy Sector Levy Act (ESLA) is not able to pay, we would have GH¢ 1.5 billion commitment to make that payment available, and they tell me that, that is not a State loan. The State is actually securing to make that particular transaction liquid by GH¢ 1.5 billion and somebody tells me that, that is not a public debt. That is why in the right description of that facility, the International Monetary Fund (IMF) and the World Bank have alerted the general public and the people of the world that, there is a potential amount of GH¢ 4.7 billion, and if ESLA does not pay, the people of Ghana must pay that money. That is what they have put there. If one is an analyst and would want to be properly secured and his risks properly protected, the person would add that figure to our public debt, whether Ghana says so or not. The person would add it there because if it goes bust, Ghana must pay. That is how one analyses debt sustainability. Mr Speaker, the biggest challenge today, in the reporting of our financial figures, is lack of reliability of the numbers. I begin to get worried when I take our numbers. I struggle to reconcile them
when I take our numbers; I cannot make any meaning out of them. Mr Speaker, this is a House of records, and it is important that, the Hon Minister for Finance comes to this House, and makes sure that, the people of this House are able to read, understand and reconcile the numbers. As we see, there are serious missing numbers; GH¢ 5.5 billion of re-profiling money must be explained to us because we were told in this House -- Again, GH¢6.9 billion of additional borrowing on external bases that did not come to this House and which is not reflected in the numbers must also be explained.
Hon Members, we shall take a short break and we would come back for the Hon Majority Leader to respond and for the Hon Chairman of the Committee to give a short response as well and then we would vote on the Motion accordingly. Hon Majority and Minority Leaders, can take half.
Mr Speaker, would 15 minutes be all right? I do not know whether you would be comfortable with 15 minutes, but it rests on you. Whatever your convenience is, we are here.
Very well. In view of the nature of business ahead of us, we shall break for an hour and come back. 1.20 p.m. — Sitting suspended. 3.34 p.m. -- Sitting resumed.
Hon Members, in view of the time and the nature of business, we are Sitting beyond the regular hours. Hon Majority Leader?
Mr Speaker, before we suspended Sitting, we were about to conclude the debate on the Motion to adopt the Report presented by your Committee on Finance on the Annual Public Debt Management Report for the 2017 Fiscal Year. Am I to understand that you are giving me the signal to continue?
Yes, you may continue, Hon Majority Leader.
Mr Speaker, the Report we are considering is the Report of the Committee on Finance on the Annual Public Debt Management Report for the 2017 Fiscal Year. I believe that the debate ought not to have been shrouded in any haste of partisanship. That was why I agreed and indeed appreciated the genesis of the submission of the Hon Fifi Kwetey, but unfortunately, he also ended up raking in partisan issues and finger pointing. Mr Speaker, the Hon Fifi Kwetey is a man who has the patent right for “Setting the Records Straight”, so if he engages in that, he certainly would have to appreciate where he is coming from. There was a debate about the quantum of the debt that had been added and whether it is GH¢28 billion or GH¢26 billion in the year. We may have to interrogate that. Mr Speaker, the Report makes an admission in item numbered 4.11 of page 9 of the Report from the Committee. With your indulgence, I beg to quote: “In 2017, Government signed ten (10) loan agreements amounting to US$506.8 million. Of this figure, six (6) loans amounting to US$394.6 million were borrowed under non- concessional terms whilst two (2) loan agreements in the sum of US$100 million were signed under concessional terms.” Mr Speaker, these indeed are matters that should agitate the minds of Members of Parliament in approving loans that come before us. Whilst we may want to urge the Executive to look for concessional loans which have softer terms, the reality is that, we are now a middle income country and these are unfortunately the consequences that we may have to bear having attained that level of development. Mr Speaker, again, the Committee's Report in item numbered 4.12 of page 9 makes some categorical statements which in my view, is scary. With your permission, I quote: “The Committee was informed that interest payments now account for 35 per cent of government revenue and 26 per cent of expenditure.” Mr Speaker, that is attributable to borrowings that this country engaged in in the previous years. These are not the net effect of the borrowings of 2017 and I guess people should understand that. They are the cumulative effect of the borrowings that this country engaged in in the previous years and that is where we are. The second sentence is also revealing. It states: “Interest payment was said to now constitute the second biggest expenditure item after compensa- tion of employees.” Mr Speaker, now, we are told that it is the second largest expenditure after compensation. But the question to ask is: when did this begin? Certainly, it was not in 2017. Mr Speaker, Hon Colleagues would agree with me that in 2015 when we had a Budget, the appropriation figure was about GH¢50 billion, we set aside GH¢10.7 billion to pay interest and that was why some of us raised this matter that we should be careful where we are going as a nation. Today, it is bloated up cumulatively and now we would have to set aside 35 per cent of government revenue to pay interests on loans. The question to ask is: “who cause am?” Mr Speaker, if matters come before us as Members of Parliament, we should interrogate the borrowings that come before we rush to approve of loans.
“It was further explained that interest payment currently represents 6 per cent of GDP as against an average of 5 per cent in the sub-region.” What it means is that, we have shot up from the average in the sub-Region to 6 per cent. Again, the question to ask is: “who cause am?” This is because, indeed, this is the cumulative effect of what some of us cautioned at the time that what we were doing as a country was reckless
borrowing and the response of the President at the time was, yes, we would continue to borrow to the extent that we would not use the loans to eat khebab or drink beer. That was the response of the President and the chicken are coming home to roost. Mr Speaker, so, when I hear Hon Colleagues take the current government to cleaners as if this was the effect of what was done yesterday, clearly, it is untenable. I am happy that today, all of us realise that we should be cautious and not rush to approve loans that come before us. Let us further interrogate it. Mr Speaker, it is the reason I have insisted that the House should have a Committee on Economy. We do not have a Committee on Economy or Economic Planning. Let them do the fiscal analysis to us on each borrowing that comes to this House, then we would be able to tell the net effect of it then, it would tell us whether or not we should approve of that loan. Mr Speaker, people should not just rush to condemn. We should know where this is coming from and when we get to know that, the four of the fingers that we would be pointing would be pointing on our chests because, we started it and Parliament was not strong enough to confront the Executive. Let us tarry a while and interrogate this further. We did not do that and we surrendered. We capitulated to the whims and caprices of the Executive and today, we say that, we are paying so much in interests. It is the product of the endeavours of yesterday. Mr Speaker, the value of the cedi has not been static since 1993. So, it is easy when we talk about the quantum of borrowing to refer to figures. Mr Speaker, but as we all do know, any student of Economics would know that no thanks to inflation, no thanks to depreciation. Percentage increase reflects the better trend in what we do to ourselves as a nation. It is easy to say that in the year 2009 when the NPP exited, the public debt was GH¢ 9.5 billion. At the time the NDC exited, the debt stock had escalated to GH¢122 billion. How much is it in percentage terms? Mr Speaker, the amount that was piled on, translates to about GH¢ 112.5 billion. That in percentage terms is about 1,200 percentage increase of the debt stock that the NDC left. That tells us that every year, on the average, they increased the debt stock by 150 per cent. So today, if they say that a go- vernment has increased it by 13 per cent and they want to malign that government, they should realise that during their time, every year, they increase it on the average by 150 per cent. Do they see where we are? [Interruption.] Mr Speaker, that is the difficulty that as a country we should confront. My Hon Colleague, Hon Abgodza, asked what we used it for? Hon Fifi Kwetey said that we should spend much more on the development of infras- tructure. I agree with him to some extent. Mr Speaker, but the Constitution, in article 34 (2), tells us where we should really spend our moneys. Mr Speaker, I beg to quote article 34 (2), which provides: “The President shall report to Parliament at least once a year all the steps taken to ensure the realization of the policy objectives contained in this Chapter; and, in particular, the realization of basic human rights…” Basic human right is the top priority as defined by this Constitution. That may not be material, but the people of this country would have their liberties. That is where the Constitution places emphasis. The second thing that the Constitution talks about is: “…a healthy economy, the right to work, the right to good health care and the right to education.” Mr Speaker, so when a government comes to power and introduces free senior high school education, it may not translate into physical infrastructure; but that is the direction the Constitution, which we voted for in the year 1992, suggests to us that, we should pursue. So when people critique the endeavour of a government, they should match it against the constitutional imperatives. Mr Speaker, an Hon Colleague of ours questioned the integrity of the figures. I do not want to debate him on that; but has the method of computation of the debt stock changed? If it has not changed and we are using the usual methods, how could anybody then stand here to question the integrity of the figures? It is worrisome. He may say that something ought to be added to it; but as an Hon Member of Parliament, he stood to question the integrity of it. When his attention was drawn to it, he said that he rather wanted to teach others; a student that wants to teach his lecturers. We should be careful the way we debate in this Chamber. Let us talk to the facts. Mr Speaker, since the days of Hon J. H. Mensah and Hon J. H. Owusu Acheampong, this House had often been afflicted with voodoo economics, but we all know the standard and indeed appreciate it. Mr Speaker, the rate at which we are growing our public debt -- as I said, I agree that we should do serious introspection. I would want us to talk to the facts. Let us not try to manufacture the facts. Let us talk to the facts as provided by the technocrats. If one borrows and does not draw down, certainly, it does not affect the debt stock. Every student of Economics knows this. It is the reason when the government sounded that it wanted to go for a US$10 billion Chinese facility to build houses, it was never added to the debt stock until they were drawn down. Otherwise, what was the quantum of US$10 billion at the time? We all knew that that was not how to do the computation of the debt stock until it was drawn down. Even after contracting the loan or the facility, if we do not draw down, we cannot add it to the computation of the debt stock. Mr Speaker, again, another issue that came up was whether the debt of State Owned Enterprises (SOEs) should be considered as public debt. We have had this debate in this House before, under the previous Hon Minister for Finance, Hon Seth Terkper. I beg to quote the Constitution because, article 182 defines public debt as:
“(1) The public debt of Ghana shall be charged on the Consolidated Fund and other public funds of Ghana.” So debts that are not charged on the Consolidated Fund and other public funds are not really part of public debt. The other Funds that Parliament creates -- the Contingency Fund is not the Consolidated Fund. Under the Petroleum Revenue Management Act, we created a Petroleum Holding Fund. It is not the Consolidated Fund. So, “other funds” refer to funds created by Parliament. People should appreciate this. Mr Speaker, I refer to the debate that went on in this House. Article 182 (2) provides: “For the purposes of this article, the public debt shall include interest on that debt, sinking fund payments and redemption moneys in respect of that debt and the cost, charges and expenses incidental to the management of that debt.” Mr Speaker, we would remember when Hon Seth Terkper came and wanted to open up space for even the District Assemblies to borrow on the strength of their own books, we had this debate. This is because we thought that as Hon Adongo argued, if the wind busted, the Consolidated Fund perhaps may be drawn into it to burn; but Hon Terkper insisted that no, this was a different account. It is not public debt, so to speak. So for people to migrate backwards now to say that we should go back to a debate that we had in this House, we should go back to the Hansard to see what we did in this House. We should not reinvent the wheel. Mr Speaker, this is just to conclude. It is not for nothing that the debt stock is usually measured against GDP. So we have the GDP to debt ratio or debt to GDP ratio. We contextualise the debt in the realm of our GDP growth. Mr Speaker, today, GDP growth is 8.5 per cent and we are saying that we have increased the debt stock by 13 per cent in a year. That may not be the best and that is why I say that we should be concerned. But if we match it against the situation in the year 2016 when GDP growth was about 3.7 per cent and they increased the debt stock by 36 per cent, that was much more scary. The nation should have value for money in everything that we do and Parliament should be together and come strongly on this so that we are able to hold the Executive to account as a collective body. That is the way to grow the economy and the country. Mr Speaker, on balance, I would say that -- Mr Speaker, let me say that because people are talking about shoddy and are not being bold enough to confront me, let me say that I would want to withdraw ‘‘shoddy'' and rather insert “inadequate works, that would translate into US$27million”; clearly, the nation did have value for money in that enterprise. Did they stand ready to support those of us, even when I introduced the bus branding they did not want to support? -- [Laughter]-- Mr Speaker, today, the lights are on. We borrowed at 13 per cent and increased the cost of the debt burden by 13 per cent and as I am saying, the lights are on. We borrowed and escalated the cost in the year 2016 alone by 36 per cent and this nation was in darkness. So comparatively, we have entered sunshine and light and we have moved away from the situation of darkness. Let us be together to grow this nation. However, I agree that we should come together so that any loan Agreement that comes here, we would apply critical thinking, to see whether or not as a nation, we shall have benefits from that loan that will come. We would because ultimately, it will go to swell up the debt stock of this country. Question put and Motion agreed to. Resolved accordingly.
Hon Members, before we bring proceedings to a close, we have a letter from the Hon Minister for Finance in a response to the direction and the Hon Minister for Food and Agriculture apprise the House on the matter of unapproved sale of cocoa insecticide and related matters today. The order being on Friday, 18th May. Hon Members, I have in mind a letter from the Hon Minister in that regard and I direct that the matter be handled tomorrow. So if the Table Office would have it duly placed before the Honourable House for the matter to be dealt with. Hon Majority Leader, at this Stage, I think in the absence of any other matter, we could close without a Motion, but just in case Leaders have something to say.
Mr Speaker, we are to deal with Motion numbered 6 on the Order Paper and it was going to be moved by the Hon Chairman of the Finance Committee but the Finance Committee and the Committee on Mines and Energy are holding a joint Committee meeting. So I am giving --
We could take that tomorrow morning. You can see that I am inclined towards adjourning.
Mr Speaker, the Hon Chairman is signaling to me that we could take it tomorrow. So we would deal with it tomorrow.
Thank you very much. Hon Minority Leader?
Mr Speaker, I think that we have exhausted the time and we have to close for the day. Question put and Motion agreed to.
The House was adjourned at 4.00 p.m. till Wednesday, 6th June, 2018 at 10.00 a.m.