Ghana’s Ministry of Finance and Economic Planning (MoFEP) has the set up a committee to review the Petroleum Revenue Management Act (PRMA) in order to address the loopholes in the Law.
An official at MoFEP, indicated that the Ministry which is the implementer of the Law has noticed some challenges in the Act hence the need for review.
“These challenges have been notified and seen. The Minister of Finance has set up a team as of September 2, 2013 to review the Law,” Mr Erick Asuman, an economist at MoFEP said last week during a roundtable event organized by the Accra-based Center for Public Interest Law (CePIL).
According to the Mr Asuman, the team is made up of members of the Ministry of Justice and Attorney General, Ghana Revenue Authority, Bank of Ghana and both the Tax and Legal team of MoFEP.
The Ministry official indicated that civil society groups and the general public will be invited to make an input during the review process “so that we factor everything into the law to iron out the problems the Law is facing”.
The PRMA, Act 815, was passed by Parliament in 2011 defines the framework for managing petroleum revenues by government. Ghana started producing oil in commercial quantity in 2010.
However, the Act fails to address areas such as capital gains, how to determine the benchmark revenue among others, according to a CePIL report released October 4, 2013. The report authored by Mr Mohammed Amin Adam was titled “Violations of the Petroleum Revenue Management Act in the 2013 Budget Statement of the Government of Ghana”.
According to the Executive Director of CePIL, Mr Augustine Niber, the PRMA is considered key and it is one of the best laws to have been enacted to govern the management of petroleum revenues.
“This is so because, as a country we had the benefit of learning from countries that have made mistakes in the governance of the petroleum revenues and those that chalked considerable success in the management of their petroleum revenues,” Mr Niber explained.
However, Mr Niber indicated that “it is one thing passing a law and another implementing it”. He added “it is one thing implementing a law and another not complying fully with the provisions of the law”.
In the view of Mr Niber the passage of laws cannot in themselves achieve the desired results if the “provisions of the law are not fully complied with by the institutions and agencies upon which this duty is imposed”.
It is against this background that CePIL said it commissioned a consultant to study and review the 2013 Annual Budget Statement and Financial Policy of the Government of Ghana to establish the extent to which the 2013 budget statement has complied or failed to comply with the provisions of the PRMA, in the collection and the disbursement of the oil revenues.
The report was also to know the extent to which the government has complied with other oil and gas laws/policies and the findings of the Public Interest Accountability Committee (PIAC).
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