Oil revenue can be used as Collateral - Parliament

Accra, Dec. 9, GNA - Parliament on Thursday dropped the prohibition cloak on the Revenue Management Bill that sought to taboo the use of oil as collateral for borrowing.

By this amendment, Government is free to use the oil revenue as security to borrow money for development purposes. One of the proposals made by Ghanaians during the consultation held before drafting the bill was that the oil revenue should not be used as collateral for loans.

Debates on the amendment of clause five of the bill to took the house into a 97 by 87 vote with one abstention, an amendment proposed by Mr Moses Asaga Chairman of Mines and Energy Committee.

The Minority which vehemently opposed the amendment argued that using the petrol revenue as collateral was dangerous as Nigeria and other oil producing countries that used that path rather descended into debt.

Mr Albert Kan-Dapaah, New Patriotic Party (NPP) member for Afigya-Sekyere West, who is also Chairman of the Public Accounts Committee, said about 83 per cent of Ghanaians called for the prevention of the use of oil revenue as collateral which parliament must not lose sight of and throw over board.

He noted that borrowing was very important but parliament must not disregard the voice of the people.

He said should the amendment be carried the spirit behind the bill would be defeated.

"Using the oil revenue as collateral is like taking lunch and dinner at breakfast," he said, and called for more consultation on the controversial clause five of the bill.

"For the credibility of parliament more consultation must be done," he said and prayed Mr Doe Adjaho, First Deputy Speaker who was in the Speaker's chair to suspend votes on the clause to be carried another day. Dr Osei Akoto, NPP member for Old Tafo, said if the oil revenue should be used as collateral, it must not be 100 per cent because 100 per cent collateral in the hands of politicians could be dangerous. "Let's be careful about 100 per cent collateralization; politicians can be intoxicating."

Mr Osei Kyei-Mensah-Bonsu, Minority Leader, said the amendment was not the best for the country under normal circumstances and cautioned the Majority to be very careful.

He observed that the country had huge deficit in infrastructure development but added that if the revenue from the oil be used as collateral at all it must be for a long-term development plan. To the Majority it is right for the amendment to be carried because it would be in the interest of the nation to use the oil revenue to seek loans for development.

Mr Dominic Azimbe Azumah, NDC member for Garu Tempane, said individuals used collateral to raise sufficient funds for projects and wondered why a whole nation could not use oil as collateral to raise loans for development. He stressed that every community was demanding good roads, electricity and people were dying in hospitals for lack of proper medical care, adding that anyone who opposed the amendment was anti-development. Mr Inusah Abdulai Fuseini, NDC member for Tamale Central, said what the amendment was seeking to do was consistent with the provisions of the bill and called on all members to support the bill.

When the question "As many as in favour of the bill say aye," was posed there was a thunderous "Aye" from the Majority side and a giant "No" from the Minority.

When determining the side that had come victorious became difficult, Mr Doe Adjaho called for all members to vote by standing to be counted, hence the result 97 in favour of the amendment, with 87 against it.