Policy think tank, Africa Policy Lens, has rejected claims by the Mahama government that the upward adjustments of utility tariffs have been necessitated directly by IMF’s conditionalities when the erstwhile Akufo-Addo administration went for a bailout of $3 Billion from the Fund.
Reacting to the recently announced tariff hikes and the justification for them, the think tank pointed out that attempts by government’s functionaries to blame the IMF are untenable, stating that upward adjustment in the utility tariffs is not a direct quatitative performance criteria or an indicative target under the IMF programme.
“Conditionalities by the IMF did not start with the NPP government. It is also not true that the $3 Billion bailout sought by the Akufo-Addo administration had increases in utility tariffs as one of its quantitative or indicative targets, even though the programme expects the energy sector to operate efficiently. This government must accept responsibility and stop blaming the previous administration” the think tank stated.
APL noted that when the NPP was sworn into office in 2017, there were sets of conditionalities by the IMF which were aimed at increasing revenue generation and cutting down on expenditure not only in the energy sector but other sectors as well.
“Notwithstanding the expectations of the IMF, the Akufo-Addo government rather reduced utility tariffs including that of electricity to reduce the burden on the people. There is always a choice to be exercised by the government and if this current government has decided to use the easy way out of the situation, they should wholly accept that as their decision and not seek to blame the previous government” APL emphasized.
“The data below depicts increases/reduction in electricity tariffs under the NDC (from 2009 to 2016) and NPP (from 2017 to 2024). It is instructive to note that both political regimes experienced IMF programmes in their first and second terms” APL stated.
Under NDC
2009 – nil.
2010 – 89% increase
2011 – 10% increase
2012 – 7.42% increase
2013 – 58.9% increase
2014 – 28.35% increase
2015 – 90.93% increase
2016 – 10% increase
Under NPP
2017 – nil.
2018 – 17.5% reduction
2019 – 17.46% increase
2020 – nil.
2021 – nil.
2022 – nil.
2023 – 51.02% increase
2024 – 6.47% increase
The NDC from 2009 to 2016 did a cumulative percentage increase in electricity tariffs of 294.6%, which translates into an average increase in electricity tariffs of 36.8% over their 8 years period in government. The NPP, on the other hand, did a cumulative percentage increase in electricity tariffs of 57.45% and an average of 7.2%.
While under the NDC, electricity tariffs were increased astronomically, Ghanaians at the same time were living in dumsor. Under the Nana Addo-Bawumia government, electricity tariffs saw minimal increase with corresponding steady and reliable supply of electricity power, according to APL.
Today, the think tank stressed, the government of the NDC that promised to reduce the cost of living for Ghanaians has, in their first four months in office, increased electricity tariffs by 14.75%. Coming events, they say, cast their own shadows.
“Let this not be blamed on any IMF programme because the data above shows that under the same IMF programmes, the NPP managed the electricity tariffs better. In effect, the IMF is not to blame for these hikes in utility tariffs. Government should solely be held accountable for them” the think tank concluded.