Government needs bi-partisan discussion on fuel subsidy
Source: Ghana|Myjoyonline.com|Edwin.Appiah|edwin.appiah@myjoyonline.comDate: 10-07-2014 Time: 07:07:13:pm
Although fuel subsidies are budgeted for and targeted at a specific segment for reasons of political economy, the tool has failed to meet its objectives of cushioning the poor.
Figures exclusively secured by JOY NEWS indicate that government has accrued a staggering Gh¢84 million cedis debt in the form of unpaid subsidies. The outstanding amount which is owed Bulk Oil Distribution companies is hurting the companies and impeding their ability to import fuel.
This situation triggered an unbearable nationwide fuel shortage a little over a week ago. Yellow gallons, a symbol of fuel shortage in Ghana were seen lined up at fuel pumps while some desperate motorists slept at gas stations in the hope of getting fuel.
Mr. Yaw Boamah raised the alarm of an impending fuel shortage in Parliament and MPs are calling for the removal of subsidies as government is unable to pay for them.
The debt resulting from subsidies currently stands at 459 million Ghana cedis.
The politics of fuel subsidy can be cured if government kickstarts a bi-partisan discussion on fuel subsidies, Mr. Boamah said.
Deputy Finance Minister, Casiel Ato Forson agrees government needs to remove fuel subsidies.
Ghanaians have been asked to "brace" themselves to pay "the right price" for fuel "if they want constant supply,", the Chief Executive Officer of the National Petroleum Authority (NPA), Moses Asaga said a few weeks ago.
He also confirmed plans by the government to remove subsidies on petroleum products.
He however refrained from giving the exact date on which this will be done except to say that it will certainly be before the end of this year.
The removal of subsidies will affect transport fares directly and trigger a general increase in the price of goods and services.
Since 1980s, fuel pricing is an extremely political issue having the muscle to unseat governments and install new ones.
The NDC government campaigned in 2007 promising to "reduce fuel drastically".
The party won and has since been re-elected in 2012.
