Tussle over Debt Exchange Programme: TUC declares indefinite strike beginning December 27

The Trades Union Congress (TUC) has declared an indefinite strike for all workers across the country beginning December 27, 2022, until further notice.

The decision was taken after the Union’s one-week ultimatum to government to exempt all pension funds from the intended Debt Exchange Programme elapsed on Monday, December 19, 2022.

TUC Secretary-General Dr. Yaw Baah, at a press conference in Accra yesterday, told the B&FT that: “All workers across the country will lay down their tools from December 27, until the government decides to exclude all pension funds including SSNIT from the programme”.

He said the Union will not allow vulnerable workers to suffer and pay the price for mistakes they did not commit.

“We won’t allow the already-suffering workers to pay for the government’s mistakes. Government is responsible for its own actions,” Dr. Baah indicated.

Key associations present at the meeting included the Ghana Medical Association (GMA), Teachers’ and Educational Workers Union (TEWU), UTAG, Concerned Teachers Association, Civil and Local Government Staff Association, Ghana (CLOGSAG), National Association of Graduate Teachers (NAGRAT) and the General Agricultural Workers Union (GAWU), among several others.

It will be recalled that the TUC on December 12, 2022 registered its displeasure over government’s intended debt exchange programme, saying the plan when executed would have a negative impact on workers’ pensions.

After a thorough analysis of the Debt Exchange Programme and extensive discussion of its implications, the Union wrote a letter to Finance Minister Ken Ofori Atta – concluding that the programme would negatively impact pension funds of members, and consequently the retirement income security of workers.

The Union gave the government and the minister a one-week ultimatum to respond favourably and exclude pension funds from the programme.

However, on December 19, 2022 – which marked the ultimatum’s deadline – government and the Ministry of Finance did not respond to the TUC’s letter.

He asked workers to get ready to participate fully in the declared industrial action to protect pensions funds, adding: “Workers will no longer bear the consequences of any IMF-inspired policies. Government is responsible for all the consequences of its decisions”.

The Domestic Debt Exchange Programme

The Domestic Debt operation involves an exchange of new Ghana bonds for coupons of longer average maturity. Existing domestic bonds as of December 1, 2022, will no longer be exchanged for a set of four new bonds maturing in 2027, 2029, 2032, and 2037.

The annual coupon on all these new bonds, according to the MoF, will be set at zero percent in 2023, five percent in 2024, and 10 percent in 2025 until maturity. Coupon payments will be semi-annual, with the programme not affecting individual bondholders.