Every you buy a litre of petrol at the pump in Ghana, 90 pesewas of your price goes into a fund most consumers may never have heard of, which is the Uniform Petroleum Price Fund (UPPF).
The levy is intended to ensure that consumers pay broadly similar petroleum prices regardless of whether they buy fuel in relatively accessible markets such as Tema or in more remote locations such as Buipe.
But as the levy continues to collect billions of cedis, questions are increasingly being raised about what happens to the money after consumers have paid it at the pump.
Data and policy analyst Alfred Appiah is calling for greater transparency over the management and utilisation of the UPPF, arguing that the public has limited information about how the fund’s substantial collections are ultimately spent.
A Levy Hiding in Every litre
For consumers, the UPPF is embedded in the price of every litre of petrol they purchase. According to Appiah, the 90-pesewa UPPF levy represents about 21% of all taxes, margins and levies imposed on petrol and roughly 6% of the current pump price.
In practical terms, a motorist buying 50 litres of petrol would contribute about GH¢45 to the UPPF through that purchase.
Multiply that across millions of litres sold nationwide, and the levy becomes a significant pool of money collected from motorists.
The purpose is to redistribute petroleum pricing costs so that consumers in locations where it is more expensive to transport fuel are not left paying substantially higher pump prices.
Where Does the Money Go?
This is where Appiah believes the public-interest questions become more important. He points to recent findings by the Auditor-General from its audit of the National Petroleum Authority (NPA), which indicated that the UPPF accumulated more than GH¢10 billion over a three-year period.
For motorists, the obvious question is that after contributing 90 pesewas from every litre, how much of that money actually reaches the intended beneficiaries?
Alfred Appiah argues that publicly available information remains insufficient to clearly establish how much is paid to petroleum transporters, how much is spent administering the fund and how much ultimately supports the objective for which the levy was created.
This information gap becomes particularly significant because the fund is financed directly through charges embedded in the price consumers pay for fuel.
The Controversy is Beyond the Former NPA Boss
The UPPF has also come under scrutiny following allegations involving the former NPA Chief Executive, who has been charged by the Office of the Special Prosecutor over an alleged scheme involving the collection of GH¢280 million from transporters and oil marketing companies.
The allegations have brought renewed attention to the controls surrounding the fund.
The policy analyst argues that the issue should therefore not end with the prosecution of an individual. Instead, it should trigger a broader examination of how the UPPF is governed, controlled and reported to the public.
The central question is whether the systems surrounding the fund are strong enough to protect the billions of cedis collected through the petroleum pricing system.
What Consumers Should be Asking
Alfred Appiah has challenged the new NPA management to explain what measures have been introduced to address the control weaknesses exposed by the allegations surrounding the former NPA boss.
He is also calling for the publication of detailed reports showing UPPF collections and utilisation, allowing consumers and other stakeholders to see where the money generated from the levy actually goes.
Perhaps most significantly, he wants an impact evaluation of the UPPF to determine whether the fund remains relevant and effective in achieving its original purpose. This question matters because the policy effectively asks motorists to contribute to a national price-smoothing mechanism every time they buy fuel.
If consumers are going to continue paying the levy, they arguably need more than an assurance that it is being collected for a good purpose. They need to know how much is collected, who receives it, what it costs to administer and whether it is actually delivering the price-equity objective for which they are paying.
