View Full Version : Money does not solve all problems; thinking does - CPP

4th October 2013, 04:46 AM
The Convention Peoples' Party (CPP) has expressed "deep worry" about recent increase in utility tariffs. It holds the view" that this seriously underscores the insensitivity of government in matters affecting the well-being of the people".

In a press statement issued in Accra Thursday,the Party argues that government needs to think much deeper about solving Ghana's energy problems than simply increasing utility tarrifs.

The Public Utility Regulatory Commission (PURC) announced a 78% increase in electricity and 52% increase for water effective October 1. The adjustment has drawn criticisms from the Trades Union Congress and the Minority in Parliament.

The full statement of CPP's position is produced below:

The statement reads:

In the past 10 months the government has blamed everyone but itself for the difficulties we now find ourselves in, in all cases involving the mismanagement of the economy. Salaries paid to workers of the nation was said to blame for budget deficit from the previous years, giving the impression that workers paid the increases to themselves.

The rot exposed in the GYEEDA report which highlighted failures was all dumped on a few low grade officers and forwarded to the Attorney Generals Department for prosecution. Without addressing the fundamental question of what happens to the leaders in whose trust the nation’s purse was entrusted and yet failed to put in place basic guidelines to ensure value for money.

All these notwithstanding, the nation has been left to bear the consequences with increases in fuel prices, increases in taxes, import duties and slapping a 5% stability tax on businesses.

As if all of this was not enough, the already over taxed and overburdened people are now being slapped with a 79.8 % increase in electricity tariffs and a 52% increase in water tariffs.

It is interesting to note that four main justifications given by the power generators for the increases, namely;

1. Increased Exchange Rate; the exchange rate increased from 1.525 GH¢/$ in 2011 to 2.092 GH¢/$ in 2013. 2. Increased Crude Oil Price; crude oil also increased from 119.08 US/bbl in 2011 to 119.79 US/bbl in 2013 3. Increased thermal percentage in generation mix; thermal percentage increased from 25% in 2011 to 40% in 2013. 4. Increased LCO and Gas requirements

All of this points to the failure of successive governments in implementing the right policies to stabilize the cedi and the total lack of fore sight of government in setting its priorities. The cedi has lost about 60% of its value since the last utility tariff increases in 2010 as a result of which it now cost 60% more generating and maintain our power generation infrastructure.

We do not think it fair to the good people of Ghana to saddle the people with the government’s failure to stabilize the currency. Government should be made to account for and take responsibility for its stewardship.

We find these increases particularly insensitive for the following reasons;

For the first half of the year besides the strain of all the fuel and tax increases, we were saddled with serious power outages which became popularly known as “dumsor”; this did not only visit untold hardships on the people but also placed serious financial burden on the common man in the purchases of generators, fuel, flash lights, candles and the cost of replacing electrical equipment broken down as a result of the power outages.

For a good percentage of people, the primary source for safe drinking water is generally via “pure water” or bottled water. Given the recent 20% increase in transport fares coupled with the 80% increase in electricity tariffs and 52% increase in water tariffs, this could result in a 100% increase in prizes of pure water and bottled water.

An even bigger problem stems from the fact that the only source of water for most people is water delivered by private water tankers. Water delivered via these tankers was already well over 60% the cost of preexisting water rates. A 52% increase in water rates coupled with the 20% increase in transport fares will tanker delivered water well out of the reach majority of the population.

The people of Ghana have endured the failures of successive governments in providing even the most basic of amenities to its people. We have dug boreholes, graded our own roads, purchased electricity poles, street lights and the list goes on and on. Enough is enough; the people of Ghana cannot continue to shoulder the consequences of the mediocre policies of government.

We do hereby call on government to intervene and reverse the recent tariff increases to levels in sync with the people’s ability to pay.

The government should in the long run take serious steps rein in the continuous depreciation of the cedi to stall the effect of the sliding value of the currency on the cost of electricity generation.

Government should work studiously to complete work on the Atuabu Gas plant. We do believe that if the government had prioritized work on the completion of the Atuabu Gas plant, most of the power generation problems we were confronted with in the early parts of the year would have been avoided.

Government should in the long term look to cheaper and alternate sources of generating power, including giving tax credits or incentives to individuals or institutions who install solar panels in their facilities.

Money does not solve all problems-thinking does. We are of the belief that such a comprehensive approach to addressing our energy needs will not only solve the problem at hand, but also prevent the recurrence of such in the future.