Dedicated $100 million dollars to fight coronavirus isn't ready

A Member of the Finance Committee of Parliament, John Jinapor has debunked claims by the Finance Minister that the US$100 million allocated to fight the novel coronavirus in the country is available.

President Nana Akufo-Addo, during his first national address to update the country on the coronavirus outbreak, said he had directed the Minister for Finance, Ken Ofori-Atta, to make available the cedi equivalent of US$100 million to enhance Ghana’s Coronavirus preparedness and response plan.

This amount, according to President Akufo-Addo, “is to fund the expansion of infrastructure, purchase of materials and equipment, and public education.” Ken Ofori-Atta, while briefing Parliament on Monday, March 30 on how the disease is going to affect the country’s economy said the $100 million was available and was ready to be used for its intended purpose.

“Mr. Speaker, as announced by President Nana Akufo-Addo on March 11, 2020, during his first broadcast on the coronavirus pandemic, Government has earmarked the cedi equivalent of US$100 million for the fight against COVID-19. Contrary to views of some sceptics that the money is not available,

I wish to assure you that the money has been secured and is available to be disbursed in accordance with our public financial management procedures and rules. Indeed, from day one, Government has not stopped spending in the fight against COVID-19,” he noted.

John Jinapor, who also doubles as a Former Deputy Minister of Power, said that those claims by the Finance Minister were dishonest. “The claim by the Minister that the US$100 million has been secured and is available is false.

A document that I have, joint memorandum to Parliament by Ministers for Finance and Health on a proposed US$35 million loan from International Development Administration of the World Bank to finance the proposed Ghana COVID-19 emergency preparedness and response project is dated 27th March 2020.

So they have just brought us a loan agreement and it was considered by the Finance Committee subsequent to which we may grant approval for government to go to the World Bank and borrow US$35 million in order to be able to raise that US$100 million.”

“Another US$65 million is an amount that will be coming from the Greater Accra Resilient and Integrated Development (GARID). This is another loan from the International Development Authority (IDA) of the World Bank.

So all the US$100 million is being borrowed from IDA and Parliament has not even prepared a report, let alone lay it before the floor to be debated, granted approval, for the Minister to proceed to go to the World Bank to collect the money. I think that honesty has to be a key issue,” he argued.

Disagreement to touch Heritage Fund

He also declared his stance on Mr. Ofori-Atta’s suggestion to use a part of the Heritage Fund to finance measures to control the spread of the novel coronavirus and solve the problems that come with it.

The Finance Minister in Parliament also called for the amendment of the Petroleum Revenue Management Act (PRMA) to allow the government to utilize portions of the Heritage Fund to combat the Coronavirus outbreak.

“Amend the PRMA to allow a withdrawal from the Ghana Heritage Fund to undertake emergency expenditures in periods of national emergency. There is an estimated US$591.1 million in the Ghana Heritage Fund,” he said.

But Mr. Jinapor pledged not to allow the government to touch money from the Fund. “So our contention is that he can come into the Stabilization Fund. We are prepared to work with him. We would work and grant him approval so that it can cushion the system.

What that does is that US$100 million from the World Bank in terms of the loan is taken care of by the President’s promise and then this US$200 million from the Stabilization Fund also takes care of the stimuli.

Aside that, the Minister is borrowing another US$3 billion. We have no problem with that but the Heritage Fund is supposed to accumulate for future generations.

The Ghana Heritage Fund has a purpose, and that purpose will not be defeated. We would not be part of any attempt to run on the back or COVID-19 to deplete the account,” he stated.

KT Hammond backs government

On the other hand, the Member of Parliament for Adansi-Asokwa in the Ashanti Region, KT Hammond says that he sees no reason why the Heritage Fund should not be invested now to secure the future of the country.

The Adansi-Asokwa legislator argued that the best time to invest the funds for the future generation to benefit from is now. “What is the purpose of this Heritage Fund? When you travel abroad you are quite happy with their infrastructure and that is because they used the money that they had at the time for the purpose of the future generation.

I mean the issue is that let’s leave this money for the purposes of the future generation. Let’s use the money to establish our systems and put together the economy to build Ghana for the future generation.”

Minority opposes the use of Heritage Fund

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

The Minority Leader, Haruna Iddrisu, insisting that it is not yet time for the government to touch the Fund argued that the government’s financial programmes must directly affect the ordinary Ghanaian.

Coronavirus pandemic to cost Ghana GHS9.5bn

The fight against 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 on Monday. The effect of the virus on the economy will worsen because Ghana just began a two-week partial lockdown of Accra, Tema, Kumasi and Kasoa.