It appears that the disparity between what government says is owed the Bulk Oil Distribution Companies (BDCs) and what the latter keeps trumpeting is not settled yet.
Indeed, it will be recalled that fuel shortages experienced last year brought up the issue of subsidies and further stoked disagreement over the actual amount of debt owed by government to the BDCs.
In June last year the BDCs had claimed that government owed them GH˘1.8 billion, which figure was disputed by the National Petroleum Authority (NPA) which argued that the amount was significantly less.
The NPA then officially stated that the amount stood at GH˘300 million. But the financial discrepancy of approximately GH˘1.5 billion raised many questions about where the truth actually lay.
To combat the claims of the BDCs government, it will be recalled tasked internationally acclaimed auditing firm, Ernst and Young to conduct an audit into the government’s fuel subsidies debt, dating back to July, 2011.
Even though industry players welcomed the move, their concern then was that it could take at least six weeks for the audit to be completed.
It is intriguing to note that the issue of the debt has resurfaced with the slump in crude oil prices on the world market. The explanation by the NPA that the over—recoveries are being used to service the debts owed the BDCs hasn’t gone down well with consumers.
It has recently emerged from the ensuing back and forth over the fuel price reduction saga that government’s total debt owed the BDCs is in excess Gh?1.5 billion and not Gh?412 million as claimed by the National Petroleum Authority.
The NPA last week in a statement said its debt to the Bulk Oil Distribution Companies (BDCs) stood at GhC412 million as of July 31, last year.
Out of that amount, GHC200 million had been paid through the windfall that has accrued from the declining price of crude oil on the international market.
Chief Executive Officer for the Chamber of Bulk Distributors, Mr Senyo Horsi said the amount quoted by the NPA is “just a fraction” of government’s total indebtedness to the BDCs.
“We have over GH˘1.5 billion outstanding that is yet to be paid by government,” he told Accra based Joy FM.
A chunk of the debt, he noted, is due to variations in the exchange rate which was the result of the huge loss in the value of the local currency against major foreign trading currencies.
Another factor he indicated is the fact that the distributing companies are forced by the government to sell the products at a fixed price even when they bought it at a higher price on the international market.
But the NPA says costs incurred by the BDCs as a result of foreign exchange losses are not the concern of the authority.
According to Public Relations and Consumer Services Manager for the NPA, Yaro Kasambata, “The 412 million cedis is the ball that NPA is keeping its eye on now”.
“I am privy to other debts such as the FX (foreign exchange) losses but that is not what this process is committed to resolving...we are using over recoveries on the world market price to pay under recoveries” Mr. Kasambata indicated.
The NPA’s response is indicative of the fact that it is aware of the said GH˘1.5 billion debt but appears not ready to deal with that yet.
One wonders exactly what the amount of the debt really is and how long it will take to retire the debt.
So then the question is how much is owed the BDCs? Is it GH˘1.8billion, GH ˘1.5 billion or GH˘200 million?
Source: The Finder
|Disclaimer: Opinions expressed here are those of the writers and do not reflect those of Peacefmonline.com. Peacefmonline.com accepts no responsibility legal or otherwise for their accuracy of content. Please report any inappropriate content to us, and we will evaluate it as a matter of priority.|