Tuesday, January 27, 2015
Withdrawal of subvention amounts to shirking of responsibility
The plan to withdraw the government’s subvention from some state agencies beginning this year has attracted mixed reactions from some civil society organisations.
While a section believes the proposal amounted to the government shirking its responsibility to the citizens, another section believes that it will help offload pressure on government payroll.
A Policy Analyst at the Integrated Social Development Centre, Ghana (ISODEC), Mr Leonard Shang-Quartey, in an interview with the GRAPHIC BUSINESS, said, “If these institutions were performing, I don’t think that government would say it is weaning them off. It seems more of an attempt to abandon responsibility and not wean off per se”.
Instead, he said, there were clear challenges that needed to be addressed, especially concerning agencies such as the Ghana Water Company Limited (GWCL) and Electricity Company of Ghana (ECG), that had been cited.
The policy
The government hinted in the 2015 budget that it was set to wean off eight subvented agencies as part of plans to trim down the wage bill.
GRAPHIC BUSINESS sources at the Ministry of Finance (MoF) said government was hoping to save between GH₵20 million and GH₵25 million per quarter, when the implementation goes live this year. Implementation is expected in phases, spread over three years.
The CSOs argue
Mr Shang-Quartey said that the wage bill of these institutions constituted a huge chunk of the government’s expenditure.
“Their bills do take a substantial part of government revenue but then the solution is not to abandon responsibility, but to deal with the problem of limited tax coverage,” he said.
He said that although subjecting some of the state agencies to the discipline of the free market system was a good thing, it may not augur well for all of them.
“The assumption behind the argument is that once you subject some of these agencies to the workings of the market, the good ones stay and the bad ones fall by the wayside. But then in dealing with state agencies and critical ones such as ECG and GWCL, they cannot be subjected to the workings of the market,” he said.
He said although there was keen competition in the market, the nature of the operations of GWCL and ECG, which involved production and distribution, was such that the talk about market bringing about competition did not arise for the two.
“So there is a bit of a problem if GWCL and ECG are included in the list of agencies to be weaned off government subvention. The idea is good based on which organisation you are looking at but in the case of GWCL and ECG, I must say that looking at the argument, it does not favour these two institutions because the element of competition is absent,” he said.
SEND Ghana
The Country Director of SEND Ghana, Mr George Osei-Bimpeh, said a bloated public sector wage bill was a major concern and, therefore, any attempt by the government to look at things from a business perspective was in the right direction.
He said although such a policy was good, it did not mean that the agencies, particularly ECG and GWCL, should be allowed to also shift every cost to disadvantage the poor.
“That’s why it is important that the regulatory mechanism that we have in the case of the Public Utilities Regulatory Commission (PURC) should ensure that the fact you have been weaned off does not mean you should be operating as a typical private sector firm that is motivated by the penchant for profit. We need to draw a line as to whether they should break even to take care of core cost or whether they will be interested in making profit,” he said.
He said it was important that the PURC be strengthened to be seen to be protecting the interest of the poor in terms of how they regulate the activities of some of these essential state organisations.
“The fact that they are being weaned off does not exonerate them from being regulated, and in doing that the PURC must always take into account that these are not there to make profit but to provide social services to everybody, including the interest of the poor,” he said.
Mr Osei-Bimpeh objected to the assumption that once they are weaned off subvention, the automatic repercussion should be passed on to the consumers, saying that could only happen if they were left on their own. But if they are regulated to determine their output as a determinant of how much they should be paid, they cannot increase conditions of service anyhow.
“We should be interested in how they plough back all those resources for investments to make their services more efficient. We need to be mindful of how they use their internally generated fund,” he added.
Expenditure
Expenditure on Wages and Salaries from January to September 2013 totalled GH¢5,883.9 million, 5.5 per cent higher than the budget target of GH¢5,576.5 million and 19.4 per cent higher than the outturn for the same period in 2012.
In addition, an amount of GH¢846.3 million was spent on the clearance of wage arrears. Expenditure on wages and salaries alone was 66.3 per cent of non-oil tax revenue (excluding exemptions) and 62.3 per cent of tax revenue (excluding exemptions).
Including the wage arrears paid during the period, expenditure on wages was 75.8 per cent of non-oil tax revenue (excluding exemptions) and 71.3 per cent of tax revenue (excluding exemptions). For the year as a whole, wages and salaries, including the provision made for the clearance of wage arrears is projected at GH¢9,567.1 million, 25.8 per cent higher than the 2013 budget estimate.
Challenges of the utilities
According to Mr Shang-Quartey, there are basically two problems facing the ECG and GWCL; investment and lack of capital to replace old and worn-out infrastructure.
He said although in the case of GWCL there were some signs of improvement in relation to new infrastructure, there was still room for improvement.
Also, he said the private sector had often rejected government’s invitation to invest in the sector because the return for the sector was not guaranteed.
“Going back to this policy again and asking the likes of GWCL to resort to such means of financing the wage bill and certain element of capital cost will mean just one thing, that the existing customer base of GWCL will be burdened by this particular situation”.
He continued, “If they cannot get additional capital for further expansion and replacement of worn-out infrastructure, the inefficiency of the system will be passed on to the consumer”.
Another challenge, he said, had to do with successive political influence or vulnerability of managers -- the board and management -- of the two state organisations.
He said an option would be to institutionalise representation on such boards so representatives from the state, market and civil society would be present.
“If we are not able to deal with the issue of political vulnerability and we withdraw subvention, it could have an effect on procurement processes, which there are a lot of problems with, and also concerning tax discipline,” he said.
Recommendations
They have recommended that the GWCL and ECG should be excluded from any move under consideration to withdraw subvention.
Mr Shang-Quartey said the discussions around the issues should be widened and should go beyond the economy, labour economist and finance experts within government, and should include government, business and civil society actors.
“We do not have to have to rush decision especially when we find ourselves in desperate times. We should be getting to the point of addressing real problems,” he said.
Friday, January 16, 2015
Monday, November 17, 2014
Monday, November 03, 2014
The feminism misconception
Ghanaian renowned writer, Madam Ama Ata Aidoo, has said that most African women have refused to be identified as feminist due to the negative meaning given to the term.
She noted that some African women feel uncomfortable when referred to as feminist because people around would think they are lesbians.
Speaking at a seminar to mark the Africa week at the Literature house in Oslo, she stressed that the word feminism is only a developmental ideology. "Feminism has to do with decision and the impulse to wish for women all that a particular society has for development."
Speaking on the theme "Literature, Feminism and the African Woman Today," she deduced that there seems to be a misunderstanding between African women and those in the western world. African women often regarded feminism as a stimulus to respond to western ideas of those who live in Europe.
However, she said like everywhere, the African woman tries to be independent at all times. Madam Aidoo said young people in the west from a young age are bombarded with images of Africa and about Africa that are defamatory.
"But don't blame them because if we had developed mentally oriented leadership, things will be different".
According to her, it is not only women who should be feminist but everyone because it is only a theoretical framing of wishing women well.
She mentioned that most of the men in African literature write with understanding to portray women as ordinary human beings that they are. "It is not only women who are feminists but even men who can write for women to feel that they have been given their due."
Most of Madam Aidoo's writings and stories focus on urbanized women, female characters who are rarely affluent but are neither destitute. Her female protagonists have often turned their attention instead toward a universal search, each for her own elusive soul and for a female identity that has been seized by an oppressive environment.
She portrays a class of women that is overburdened by the insensitivity of men but is accepting or at least cognizant of specific gender issues that create the cultural environment.
The Women's Manifesto for Ghana is the result of mobilization by some feminists. It is a political document that identifies key national issues of concern to women and calls on policy makers and relevant agencies to address them.
Dr. Dzodzi Tsikata, a women's rights advocate once said there seem to be a commonly observed anxiety over feminism - that it is seen as overtly, if not aggressively political.
She explained that in many countries in Africa, gender activists are accepted as long as they focus on programmes such as credit for women, income generation projects and girls' education, and couch their struggles in terms of welfare or national development.
"Once they broach questions of power relations or injustices, they are accused of being elitist and influenced by foreign ideas that are alien to their culture."
Author: Ama Achiaa Amankwah, Oslo- Norway
Friday, September 26, 2014
Diffusion Theory
Diffusion theory, also known as the Diffusion
of Innovation theory, is said to be one of the
oldest social science theories. It begun in
communication to explain how, over time, an idea or product gains momentum and
diffuses (or spreads) through a specific population or social system.
Consequently, people adopt
a new idea, behavior, or product. Adoption means that a person does something
differently than what he did previously, such as the purchase and use of a new
product.
The key to adoption is
that the person must perceive the idea, behavior, or product as new or
innovative. It is through this that diffusion is possible.
When promoting an
innovation to a target population, it is important to understand the
characteristics of the target population that will help or hinder its adoption.
The
theory states there are five stages to the process of adopting an innovation.
The first stage is knowledge; an individual becomes aware of an innovation, next
is persuasion; the individual becomes actively interested in seeking knowledge
about the innovation, and the third stage, decision; the individual weighs the
advantages and disadvantages of the innovation and decides whether or not to
adopt it.
After
these comes implementation; the individual actually does adopt and use the
innovation, and confirmation; is the final stage.
A
limitation of the theory, include the fact that it does not take into account
an individual's resources or social support to adopt the new behavior or
innovation.
This theory has been
used successfully in many fields. In public health, it is used to accelerate
the adoption of important public health programs that typically aim to change
the behavior of a social system.
References
E. M. Rogers, (1962). Diffusion of Innovations, 43-94
John R. Bittner, Mass Communication An Introduction, 5th
Edition, 385-387
Thursday, August 14, 2014
Tuesday, August 12, 2014
Thursday, July 10, 2014
Call for Ghana to improve oil palm production
Call for Ghana to improve oil palm production
By Ama Amankwah Baafi and Prosper M. Dagba
THE Minister of State in charge of Finance and Allied Institutions, Mr Fiifi Kwetey, has called for an awakening to the huge potential of oil palm production in the country.
He said currently we are prodcuing an estimated 243, 852 tonnes of palm oil and that falls short of the estimated demand of 350,000 tonnes.
Mr Kwetey said considering the shortfall in local production coupled with the 850,000 tonnes of the product demanded in the ECOWAS sub-region alone, urgent steps were required to increase production locally to take full advantage of the opportunities.
He was speaking at the launch of an initiative, Incubator and Access to Finance (SAIF), a component of the Sustainable West Africa Palm Oil Programme (SWAPP), by Solidaridad West Africa.
The SWAPP’s goal is to increase the productivity and profitability of small to medium scale enterprises (SME), farms and mills in the oil palm sector, starting in Ghana and to be replicated in other West African countries.
The SAIF is a component of SWAPP that seeks to provide incubator support and access to risk capital to help grow businesses and accelerate the development of the oil palm sector in West Africa.
The Dutch government is providing about €12 million Euros for the SWAPP, focusing mainly in Ghana and with subsequent interventions in Cote d’Ivoire and Nigeria within the next two years.
“There is vast resource of arable land and huge young population and so it is important for us to encourage particularly our younger generation to enter into oil palm investment. Oil palm remains an untapped opportunity for our country and investors around the world. Agribusiness can help solve the problem of unemployment,” he said.
Oil palm production
Unlike Malaysian farmers who produce the world’s largest tonnage of oil palm, many oil palm farmers in the country lack knowledge of best practices and this has resulted in poor returns and limited investment, thereby impacting on the overall economy. Also, these affect the ability of those in the sector to access the needed funds.
Against this background, Mr Kwetey lauded the initiative by Solidaridad, saying that “through the intervention of SWAPP, highest yield of about six tonnes per annum has improved to 14 tonnes. We are grateful to the Dutch government for its immense support to the agriculture sector and to fund such a programme to change the face of agriculture, particularly oil palm.”
The SAIF
This will deplore a system that will bring together a wide range of stakeholders to develop the oil palm sector. It will also support the growth of business entrepreneurs in the oil palm sector by providing them with technical support, business development services and access to finance.
The Managing Director of Solidaridad, Mr Isaac Gyamfi, said Solidaridad worked on creating sustainable supply chains from the producer to the consumer and enabled producers in developing countries to get a better price for better products. It is also helping to preserve people's environment.
“Solidaridad is convinced that the agricultural sector can produce more efficiently so that it will be able to feed the world population in 2050, as well as supply energy and plastic to the industry. That is why Solidaridad is investing in enterprising farmers in developing countries and putting emphasis on the improvement of their land use so that production can increase while at the same time help decrease the harm to people and the environment,” he said.GB
Number crunch
305,758 hectares
Ghana has a total of 305,758 hectares of oil palm plantation with more than 80 per cent of this being cultivated by private small-scale farmers.
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