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As The Volta River Authority (VRA) battles for a lifeline by way of tariff increases, it has emerged that the government of Ghana owes the authority GH�250 million. The amount is owed by government ministries, departments and agencies (MDAs), VALCO, Ghana Consolidated Diamonds Limited, Prestea Gold Resources Limited, Dunkwa Continental Goldfields Limited, among others. This was disclosed by the acting Chief Executive Officer of the VRA, Mr Kweku Awotwe, at a sitting of the Public Accounts Committee (PAC) of Parliament yesterday. The PAC�s sitting was in respect of the Auditor General�s report on the public accounts of the VRA for the periods ended December 2004 and December 2005. The revelation provided some talking points during the sitting, as the committee members questioned the justification for the VRA�s recent demand for tariff increases in the light of such huge indebtedness on the part of the government. A Deputy Minister of Energy, Mr Emmanuel Armah Kofi Buah, told the committee that the government was not in a good financial position but was hopeful that a time would come when it would not be in red and would be able to pay all its debts. However, Mr Awotwe said the VRA was in a difficult position, indicating that there was cause to be �worried about the future of the VRA�, especially in a situation where its operational cost was more than the revenue it generated. He indicated that on a monthly basis, the VRA spent about $40 million on crude imports for its operations, while it generated only GH�70 million every month by way of revenue. But the Chairman of the Committee, Mr Albert Kan-Dapaah, wondered why the authority continued to sell to consumers it could not collect money from. He said if the VRA accrued debts, they translated into tariffs, adding that �it is dangerous to continue to sell to customers who don�t pay.� The Vice-Chairman for the PAC and MP for Dormaa West, Mr Kwaku Agyeman Manu, had earlier argued that bad debts could easily translate into tariff increases imposed on good consumers and wondered why the management of the VRA had not initiated measures to sell off the debt. Committee members had also expressed worry over the level of commercial and technical losses in the VRA, which presently is at a combined rate of 18 per cent. While admitting that bad debts could, indeed, translate into tariff increases for good consumers, Mr Awotwe noted that even when the debts were catered for, there would still be the need to increase tariffs. Providing some figures to state his case, he said in 2004, the authority made an operational loss of GH�43.7 million, while in 2005, it made an operational loss of GH�50.8million. He said while the VRA was hopeful of collecting what was owed it by the government, it was quite restricted in the strategy it could use, as it was dealing with the government. Mr Awotwe conceded that sometimes when dealing with the government, it was difficult to employ market-based solutions. He said there had been arrangements where, in some cases, mining companies acting s concessors collected money from consumers on behalf of the VRA and yet failed to pay same to the VRA. He cited an example in Prestea where GH�350,000 was collected from consumers, yet only GH�9500 was left in the accounts. �When we made attempts to disconnect Prestea, the government prevailed on us not to do so,� he stated, explaining that the government was of the view that such cases were sensitive community issues.