COVID-19: Minority oppose use of Heritage Fund

The Minority side in Parliament has shot down proposals for government to use part of the Heritage Fund to finance the fight against the coronavirus disease in the country.

The Minority insists that it’s not yet time for government to touch the Fund. Finance Minister, Ken Ofori-Atta had earlier today, Monday, March 30, 2020, proposed the amendment of the Petroleum Revenue Management Act to allow the government to utilize portions of the Heritage Fund.

President Nana Akufo-Addo in his last address to the nation on the spread of Coronavirus in Ghana on Friday, March 27, 2020, said that he has instructed the Finance Minister to make available GHC1 billion in a move to mitigate the impact of Coronavirus on businesses and households and to ensure that job losses are minimized.

But the Minority Leader, Haruna Iddrisu argued that the government’s financial programmes must directly affect the ordinary Ghanaian.

“There is no difficulty in giving him (Finance Minister) approval to use the stabilization Fund but what we are saying is that the Heritage Fund was set out for a purpose and we are not there yet. So make use of the stabilization reserve to support your activities and not the Heritage Fund,” Haruna Iddrisu insisted.

Government seeks IMF support to help fight the Coronavirus

Ghana had earlier turned to the International Monetary Fund for financial support to combat the novel coronavirus pandemic. The IMF in a press release disclosed that the government had requested a rapid credit facility disbursement.

IMF’s African Department Director, Abebe Aemro Selassie is quoted as saying: “Last week, the IMF received Ghana’s request for a disbursement under the Rapid Credit Facility to help the country address the economic impact of the COVID-19 pandemic”.

“We are working hard to evaluate the authorities’ request and bring it forward for Executive Board consideration as soon as possible,” the statement added.

About the Heritage Fund

The Heritage Fund is a creation of section 10 of the Petroleum Revenue Management Act 815 enacted in 2011. The purpose of the establishment of this fund is to provide an endowment to support the development of future generations when the petroleum reserves have been depleted according to Act 815 (2011) and amended Act 893 (2015).

The fund receives a percentage of oil revenue accrued to the Petroleum Holding Fund. In view of this Parliament of Ghana pegged this figure at 9%. This means that out of the total oil revenue received into the Petroleum Holding Fund the Heritage Fund receives only 9%.

Coronavirus pandemic to cost Ghana GHS9.5bn – Finance Minister

The novel coronavirus pandemic is set to cost Ghana GHS9.505 billion, according to Ken Ofori-Atta, the Finance Minister. This will be 2.5 percent of Ghana’s revised GDP.

“Mr. Speaker, the total estimated fiscal impact from the shortfall in petroleum receipts, shortfall import duties, the shortfall in other tax revenues, the cost of the preparedness plan, and the cost of Coronavirus Alleviation Programme is GHS9.505 billion,” he said when he appeared in Parliament today, Monday.