NDC Reacts To Increases In Electricity And Water Tariffs

The opposition National Democratic Congress, NDC has reacted angrily to the tariff increases announced by the Public Utility Regulatory Commission (PURC) on Monday.

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Consonant with the underlying thrust of government policy, the Public Utility Regulatory Commission (PURC) has announced steep increases in utility tariffs for electricity and water. The increases have been long in preparation. Indeed, throughout its nineteen months in power government has regularly indicated that utility prices will rise again and again. Yesterday, the tariffs for electricity and water were raised by 60 and 40 per cent respectively. A further rise of 12 per cent will take effect in March next year.

The response of government to the actions of PURC has been less than plain and convincing. The Daily Graphic of 24 July reported the Minister for Information and Presidential Affairs as expressing disappointment at the increases and saying that the tariffs had been hiked without consultation with the relevant ministries. The statement also noted that PURC is independent and has legal authority to determine and set loan debacle when official statements assured the public that the constitutionally and statutorily independent Governor of the Bank of Ghana had been ‘sent’ by government.

It is strange that while an independent Governor could be ‘sent’, government should simply surrender in the face of the actions of a regulatory body. It does seem curious that government should so dramatically abdicate its responsibilities to the people of Ghana by citing non-consultation. The increases have hit consumers hard. By their nature rises in the cost of electricity and water are spread throughout the country and effect citizens uniformly. Higher costs of electricity affect industries, in particular. In industrial processes requiring high inputs of water and electricity, the increases may well double the cost of production and reflect in higher prices of commodities. There is hardly any segment of the industrial sector that will not be affected by the increases.

Households and non-industrial business will also suffer devastating consequences. Business has slumped and even the Minister of Finance has acknowledged that the economy is fragile. Individual and household incomes are low and grossly insufficient. Businesses and households will now be required to set aside a significant chunk of miniscule incomes just to meet utility bills. The effects on average households are too dire to contemplate.

Ruthless policies, however roughly conceived in the abstract, do have real consequences on people. Failure to keep up with payments on electricity and water bills may result in mass disconnections. In fact, government functionaries have for some time now been yelling for disconnections as a means of making the electricity and water industries more efficient. If they have their way water, the very basis of life, may well be denied to poor families who could also be condemned to living in unsanitary and unhygienic conditions, leaving them prey to disease and death.

We call on government to acknowledge its responsibility to the people of this country and put together policies that recognize the harshness of the current economic situation. The NDC has observed with concern government’s inclination to pursue contradictory policies in regard to the economic impact of its policy objectives on different sections of the society. The recent Customs and Excise (Amendment) Act, changing a decades-old law banning the importation of right-hand vehicles is a case in point.

The original statute had properly banned the importation of right-hand vehicles for reasons of safety and uniformity. However, to permit the importation of such vehicles. Although seemingly of general application, the law was enacted to benefit a specific company, which had, even before the amendment, been importing averaged British omnibuses into the country.

It is imperative to pursue economic policies with candour, and avoid economic disempowerment and social divisions created directly by the consequences of government policy. The NDC notes with concern that blaming previous governments seems the only remedy the present government has to the problems of the country. While claiming that they inherited nothing, government has found billions to renovate the Castle and hundreds of billions more to overspend its budget.

At the same time, government continues to contract huge loans even while it complains that the loans of the past have left, the state coffers dry. It is time government told Ghanaians with candour whether it is statistically possible that at the rate it is contracting loans, it can leave any money in state coffers at the end of its tenure.

The NDC demands the institution of measures to ameliorate the impact of the rise in tariffs and to alleviate the suffering of Ghanaians. It will not be out of order to create a Water Fund, for instance, to provide alternative sources of water to households where supplies are cut. Government also ought to review its general commitment to removal of subsidies and target ameliorative measures appropriately. We demand also the withdrawal of the tariffs as well as measures to assure government control over regulatory bodies.

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