Amidst the heated debate over government’s subsidies on utilities costs, Executive Secretary of the Chamber of Petroleum Consumers (COPEC), Duncan Amoah has strongly opposed calls for their removal.
Duncan Amoah argues that the real problem lies in the operational inefficiencies leading to very significant revenue leakages within the various utility companies with the Electricity Company of Ghana (ECG) being the chief culprit.
Subsidies on electricity have become a thorny issue in recent times, causing a very polarized debate. While a section of the public is calling for its removal to enable ECG to be strengthened financially, others strongly oppose the move, justifying its negative impact on poor and low-income earners.
The country is spending a significant portion of its scarce resources to pay these subsidies. For instance, Minister for Finance, Dr. Cassiel Ato Forson, presenting the State of the Nation’s finances at the National Economic Dialogue on Monday revealed that subsidies form part of the leading discretionary spending that is straining the government’s fiscal space.
He said the “fiscal space is constrained by high interest payments, high energy subsidies and mounting rigidities.”
On the sidelines of this and speaking to The High Street Journal at the National Economic Dialogue, Duncan Amoah cautioned against any attempt to force Ghanaians to bear additional costs through the removal of subsidies or increased utility costs when ECG continues to lose revenue due to operational inefficiencies, financial mismanagement, and poor debt recovery.
“I am of the persistent view that you cannot have a country that continues to leak revenue, where, like you heard, ECG – the more we are paying the energy sector levies to take care of the bleeding, the more we bleed the sector and the more we allow things to deteriorate,” he told The High Street Journal in an interview.
To him, ECG as an entity itself must be fixed before any concrete decision on subsidies could be taken. He says it will not be prudent for tariffs to be increased and subsidies removed in the current inefficient state of ECG.
Duncan Amoah says, first things first, ECG must undergo urgent efficiency reforms before subsidies can be considered.
“You cannot do that at this point. It is also not to say that go and increase the cost of utilities. If you don’t stop the bleeding, you simply will collect and collect. So you need to stop the bleeding, then we can have a holistic review of the sector, then we can decide going forward what is prudent and what is user-friendly and affordable,” the Executive Secretary of COPEC argued.
He added, “You cannot continue to bleed as an energy sector that only leaves debt, and then you come back to the people and say pay more. If you don’t halt the bleeding, you are simply opening the basket, hoping that the water will fill the basket at some point, it won’t.”
Duncan Amoah’s remarks deepen the critical debate on Ghana’s energy sector, where questions remain about whether state-owned enterprises like ECG are truly capable of running as commercially viable institutions.
His warning underscores the urgent need for reforms to address financial mismanagement and inefficiencies before placing additional burdens on consumers.
