Brouhaha Over Tariffs: We Need Dialogue, Not Strike - Govt

The government has called on organised labour to engage it constructively through meaningful discussions, instead of threats of strike. The Minister of Information and Media Relations, Mr Mahama Ayariga, who made the call on behalf of the government, appealed to Ghanaians to appreciate the challenges facing the economy. He, however, added that if Ghanaians wanted the government to subsidise utility tariffs, they must agree through debates. “If we still want to subsidise, it is our own money; let us debate that,” he said. Addressing the 21st annual general meeting of the Institute of Public Relations, Ghana in Accra yesterday, Mr Ayariga said although the government appreciated the concerns of the public over the increases in tariffs, there was the need for the people to appreciate that the measures were necessary interventions that were required to build and sustain utility providers to continue to provide efficient and reliable services. He said any government subsidy would be targeted at the vulnerable and the needy in society. The meeting, which was also used to admit newly qualified members to the institute, was on the theme, “Strategic Public Relations in a Challenging Economy: An Essential Tool for Nation-Building”. Last month, the Public Utilities Regulatory Commission (PURC) announced a 78.9 per cent increment in electricity and a 52 per cent increment in water tariffs, effective October 1, this year. The increments fell short of the 166 per cent and the 112 per cent requested by the electricity and water providers, respectively. Apparently dissatisfied with the increment, organised labour issued a 10-day ultimatum to the PURC and the government to reduce the tariffs or face the wrath of workers. Technical Working Group (TWG) Following workers’ agitation over the utility tariffs, the government set up a Technical Working Group (TWG) on utility tariffs to examine their concerns, vis-a-vis the sustainability of utility providers. In its report, the TWG indicated that in order to cover at a minimum the cost of generation and transmission, tariff adjustments above 60 per cent might be necessary, taking into consideration the need to minimise the negative budget implication, among other things, and the impact of the utilities on workers. Organised labour, on Tuesday, decided to embark on a nationwide strike on Monday, November 18, 2013 to back its demand for a reduction in the tariff increases. At the end of its meeting to deliberate on recent developments relating to increases in utility tariffs, the group called on workers in the formal and the informal sectors to stay at home on November 18 to express their dissatisfaction with the failure of the government to reduce the tariffs. In a statement issued after the meeting in Accra, the group further advised labour unions and groups to convene meetings before the said date to plan and stage demonstrations in all the regional capitals before November 18. It also asked the various labour groups to convene emergency meetings as soon as possible to adopt the necessary resolutions to back the planned nationwide industrial action. The statement was signed by representatives of the Trades Union Congress (TUC), the Ghana National Association of Teachers (GNAT), the National Association of Graduate Teachers (NAGRAT), the Polytechnic Teachers Association of Ghana (POTAG), the Polytechnic Administrators Association of Ghana (PAAG), the Industrial and Commercial Workers Union (ICU) and the Judicial Service Staff Association of Ghana (JUSSAG). Commenting on the decision by organised labour, Mr Ayariga said the government was surprised at the threat by organised labour to embark on a nationwide strike on November18, 2013. He said the government wondered why organised labour, which was part of the decision by the PURC that arrived at the tariff hikes and the TWG to review the hikes, would turn round and kick against the tariff increases, adding, “I don’t know what we can do.” Corruption Reacting to the concerns raised by a representative of PRINPAG over increasing trends of reported cases of corruption on the same platform, Mr Ayariga said the government was not denying challenges of accountability and transparency in the system and added that people must appreciate the issues and put them in the right context. He elucidated that in the case of the Ghana Youth Employment and Entrepreneurial Development Agency (GYEEDA), since its establishment, Parliament had been approving funding for the agency without adequate checks and balances to police how the resources were managed. He added that because it was generally perceived that the private sector could efficiently manage some of these programmes, the government outsourced portions of the work to the private sector but, unfortunately, there was no framework to protect the public purse. Mr Ayariga said the government was not leaving anything to chance but working to ensure that the public purse was protected. Flagstaff House Echoing a similar position at the daily media briefing at the Flagstaff House in Accra yesterday, Mr Felix Ofosu Kwakye, a Deputy Minister of Information and Media Relations, said in as much as the government appreciated the concerns raised by organised labour, the act establishing the PURC, Act 538, debarred the government from interfering in its work. Govt won’t interfere in our work The act stipulates: "Subject to the provisions of this act, the commission shall not be subject to direction or control of any person or authority in the performance of its functions." Therefore, the deputy minister said, "The government is unable to interfere in the work of the PURC." He said what the government could do and continued to do was to subsidise the tariffs as announced by the PURC. For instance, he said, 56.75 per cent of the two million customers of the Electricity Company of Ghana benefited from subsidies. "The government has already shown commitment to help Ghanaians to cushion some of these adjustments. Unless when these consumers engage in commercial activities, they will continue to get subsidies," he said. Mr Ofosu Kwakye said the committee that looked into the tariff hikes indicated that if the PURC should reduce the tariffs by 60 per cent, it meant that the government would have to cough up GHc207 million to make up for the loss that would be incurred. That, he said, would have serious implications for government's ability to meet critical expenditure activities. For instance, he said, the wage bill continued to rise, while the government was supposed to make some back payments to public sector workers. The deputy minister said while the government remained concerned about the increases in utility tariffs, it was important that the financial viability of the utility companies in meeting certain infrastructure needs was factored into the debate. He said the government's main concern was to make the necessary investment to ensure stable electricity supply in the country. "If we are not able to make the kind of investment that will make the utility companies to continue to offer stable and reliable electricity supply, the system will grind to a halt and that will lead to frequent power outages. "That is not the situation that any Ghanaian wants," he stressed.