Ghana: Gov’t to spend GHC50m on petroleum subsidies in 2015

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The government of Ghana is to spend GHC 50 million on petroleum

subsidies next year.

It has spent GHC 25 million in 2014.

The 2015 petroleum subsidy allocation was announced on the floor of

Parliament by James Avedzi, Chairman of the Finance Committee, during

the debate on the budget estimates for the government to finance its

obligations such as payment of pensions and gratuities for the 2015

financial year.

The House approved an amount of GHC 22 million as budget estimates for

the government to finance its obligations such as payment of pensions

and gratuities for the 2015 financial year.

Votes for such expenditure items were titled "Services of Other

Government Obligations."

Mr Avedzi noted in the committee's report on the vote that; "officials

from the Ministry of Finance, however, explained that the assumptions

underlying the 2015 allocation is that the automatic petroleum price

adjustment will continue in 2015.

"The allocation is intended to pay for any excess that may arise in

the course of the cross subsidy implementation," he said.

On projections for social security payments, Mr Avedzi said the

committee noted that employees' contribution of social security had

been projected as 10.3 per cent of estimated wage bill for 2015

instead of the actual statutory figure of 13.5 per cent of basic


He said officials from the Ministry of Finance explained that the 2015

estimated wage bill actually comprised other elements on which social

security was not payable and, therefore, projecting the social

security contribution at the 13.5 per cent might lead to double

counting and over estimation.

"The officials further explained that the current system made it

difficult to isolate the component of the wage bill on which social

security was applicable and deductible and as such the projections are

currently based on five-year average of social security payments by

government," he said.

He said it was, however, added that the Controller and

Accountant-General's Department actually used the statutory 13.5 per

cent in the computation and payment of the actual social security


He spoke also on outstanding payments and said the committee observed

that as at September 2014, outstanding payments into the National

Health Insurance Fund stood at one billion Ghana cedis while GET Fund

was GHc 379, 558,315.

"Outstanding Social Security payment stood at GHc948, 052,418 and that

of DACF was GHc410,223,600," he said adding that the committee was

informed that the Government intended to remain current regarding

social security and as a result had reached agreement with SSNIT to

securitise the outstanding social security contributions arrears.

On the National Health Insurance Fund, Mr Avedzi said the committee

was informed that the government intended to settle all arrears before

the end of the 2014 fiscal year whilst arrangement were far advanced

to settle up to the second quarter DCAF arrears by the end of 2014.

He announced that the remaining two quarters would be made in 2016 and

2017 financial years.

Credit: GNA

Kofi Oppong Kyekyeku

I am a Ghanaian Broadcast Journalist/Writer who has an interest in General News, Sports, Entertainment, Health, Lifestyle and many more.

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