Debates of 24 Jun 2015

MR FIRST DEPUTY SPEAKER
PRAYERS 11:20 a.m.
VOTES AND PROCEEDINGS AND THE OFFICIAL REPORT 11:20 a.m.
Mr First Deputy Speaker 11:20 a.m.
Hon Mem- bers, correction of the Votes and Pro- ceedings of Tuesday, 23rd January,
2015.
  • [No correction was made to the Votes and Proceedings of Tuesday, 23rd June, 2015.]
    • Mr First Deputy Speaker 11:20 a.m.
    Hon Members, we have one Official Report and the Special Official Report of Friday, 19th June, 2015 for correction.
  • [No correction was made to the Official Report of Friday, 19th June, 2015.]
    • Mr First Deputy Speaker 11:20 a.m.
    Hon Members, we have Questions, but I do not know what the pleasure of the Hon Majority Leader is.
    Mr Alban S. K. Bagbin 11:20 a.m.
    Mr Speaker, I would like to pray for your leave for us to vary the Order of Business by moving to item number 5 dealing with Presentation of Papers.
    I am informed that on the issue of item number 3, the Answers are printed on a separate sheet which is yet to be distributed. I have not got mine, and so that is being done.

    We would do item number 5, particularly 5(b) and (c), and then move to the other items that I would draw your attention accordingly.

    On item number 5 (a), the Hon Minister is still on his way, and so by the time we finish with these items, maybe, he would be in to lay it, then we could handle the other items.
    Mr First Deputy Speaker 11:20 a.m.
    Very well.
    PAPERS 11:20 a.m.
    Mr Bagbin 11:30 a.m.
    Mr Speaker, the Answers to the Questions have now been distributed to Hon Members. The Hon Minister for Power is available and ready to respond to the Questions of Hon Members and I think it is proper for us to now take item number 3 which deals with Questions.
    Mr First Deputy Speaker 11:30 a.m.
    Very well.
    Hon Minister?
    Hon Members, the first Question stands in the name of the Hon Member for Nabdam. Hon Member, you have the floor.
    Mr Boniface G. Adagbila 11:30 a.m.
    Thank you, Mr Speaker -- [Interruption.]
    Mr First Deputy Speaker 11:30 a.m.
    Hon Member, I am informed that yours is in a Written Answer form. Is that right?
    Mr Adagbila 11:30 a.m.
    Yes, Mr Speaker.
    Mr First Deputy Speaker 11:30 a.m.
    So, I do not think we have to give you the floor. It is only with the Oral Answers that Hon Members are given the floor to ask.
    Hon Members, we then move on to the next Question.
    Mr Adagbila 11:30 a.m.
    Mr Speaker, I did ask for Written and Oral Answers --
    Mr First Deputy Speaker 11:30 a.m.
    Hon Member, resume your seat. We are dealing with the matter -- [Pause.]Hon Member, I believe that this has to do with Standing Order 64 (4):
    “A Member who desires an oral answer to a Question shall mark it with an asterisk. Answers to Questions not so marked shall be communicated in writing to the Member asking the Question and shall be printed in the Official Report.”
    So, this is the category under which your Question falls.That is why we cannot give you the floor to ask the Question for the Hon Minister to respond to orally. So, we will move on to the next Question which stands in the name of the Hon --
    rose
    Mr First Deputy Speaker 11:30 a.m.
    Hon Majority Leader?
    Mr Bagbin 11:30 a.m.
    Mr Speaker, I would want to assure the Hon Member that the Answer to his Question will be published in the Official Report of the House for today's Sitting. So, at least, the Answer will still be on public record and that is sufficient.
    But from the form, the Hon Member actually circled “written” and according to our rules, that is what has to be done. A copy will be given to him and the Answer will be recorded in the Official Report.
    WRITTEN ANSWERS 11:30 a.m.
    TO QUESTIONS 11:30 a.m.
    Minister for Power (Dr Kwabena Donkor)(MP) 11:30 a.m.
    Mr Speaker, the Ministry of Power lacks the competence to quantify the losses. The Ministry is however, aware that institutions such as the Institute of Statistical, Social and Economic Research (ISSER), Centre for Economic Policy Analysis (CEPA), Statistical Services and the National Development Planning Commission (NDPC) do some work in that area.
    Mr First Deputy Speaker 11:30 a.m.
    The next Question stands in the name of the Hon Member for Dormaa Central.
    ORAL ANSWERS TO QUESTIONS 11:30 a.m.
    MINISTRY OF POWER 11:30 a.m.
    Dr Kwabena Donkor 11:30 a.m.
    Mr Speaker, Asunsu Nos. 1 & 2, Dwen, Koradaso, Danyame, Sukura, Nsesreso form part of the ongoing electrification project being funded by the US EXIM Bank and executed by Weldy Lamont and Associates.
    High voltage, low voltage and substation works at Asunsu No. 1, Asunsu No. 2 and Danyame have been completed in these communities. The list of potential customers who have wired their premises is being compiled to allow for the commencement of customer service connections. The project is expected to be completed by the end of the third quarter (3rd) of 2015.
    Installation works at Dwen, Koradaso, Sukura and Nsesreso are 80 per cent complete. Work in these communities has stalled as a result of delays associated
    with the extension of the credit facility duration for the project. The delays are affecting the release of funds to allow for the completion of outstanding works. The Ministry of Power is liaising with the Ministry of Finance to expedite the extension of the credit facility duration to enable the continuation and completion of outstanding works.
    Dababi community forms part of the ongoing electrification project in the Ashanti and Brong Ahafo regions being funded by the India EXIM Bank through the ECOWAS Bank for Investment and Development (EBID). High voltage, low voltage and substation works have been completed in the community. Currently, thirteen (13) out of twenty -four (24) energy meters have been installed in the community. The project is expected to be completed by the 3rd quarter of 2015, following the wiring of the premises of outstanding potential customers.
    Mr First Deputy Speaker 11:30 a.m.
    Hon Member, do you have any follow-up questions?
    Mr Agyeman-Manu 11:30 a.m.
    Yes, Mr Speaker, I have about five (5) follow-up questions. [Interruption.]
    Mr Baghin 11:30 a.m.
    But you are entitled to only three (3).
    Mr Agyeman-Manu 11:30 a.m.
    Hon Majority Leader, you are not the Deputy Speaker.
    Mr First Deputy Speaker 11:30 a.m.
    You are entitled to only three follow-ups.
    Mr Agyeman-Manu 11:30 a.m.
    Mr Speaker, I would like to find out from the Hon Minister, whether he is not aware of the EBID facility which has not been touched and Ghana has lost close to about US$500,000.00 for various types of fees on that facility. What is he doing to push the Hon Minister for Finance to tap that money to do the work for us?
    Dr Donkor 11:30 a.m.
    Mr Speaker, the Ministry of Power is working closely with the Ministry of Finance to unbundle some technical issues associated with this particular funding.
    Mr Speaker, the contractor and the India EXIM Bank as well as the ECOWAS Bank for Investment and Development have procedural issues on how the whole facility is to be expended. The Government of Ghana is engaged in negotiation with these institutions to iron out the outstanding procedural issues.
    Thank you, Mr Speaker.
    Mr First Deputy Speaker 11:40 a.m.
    Yes, Hon Member, your second follow-up.
    Mr Agyeman-Manu 11:40 a.m.
    Mr Speaker, the Hon Minister is very emphatic on the completion of the project by the end of the third quarter of 2015.
    Mr Speaker, come September 2015, if the project is not completed what would be the Hon Minister's next option? Would he consider resigning, or he would continue to be there to try and extend the date? And his resignation should not coincide with that of December but the September 2015 one.
    Dr Donkor 11:40 a.m.
    Mr Speaker, projects would usually have estimated time for completion. This estimated time is based on the best available information and the best project management analysis.
    However, Mr Speaker, as with all projects, the external environment could change within the estimated completion period and when the external environment changes, it goes without saying that the completion period may change. But as of

    today, with the best available information to the Ministry, the projects are slated for completion by the end of the third quarter,

    2015.
    Mr First Deputy Speaker 11:40 a.m.
    Hon Member, your last follow up.
    Mr Agyeman-Manu 11:40 a.m.
    Mr Speaker, I believe that the Hon Minister is aware that some aspects of communal labour were used on these projects.
    Would he tell us, whether communal labour was an aspect of the contract awarded within both facilities and both projects that he has identified?
    Dr Donkor 11:40 a.m.
    Mr Speaker, I am not aware that communal labour was used.
    Mr First Deputy Speaker 11:40 a.m.
    Hon Members, we now move to the next Question which stands in the name of the Hon Member for Bosome-Freho.
    Hon Member, you have the floor. Is he in the Chamber?

    Hon Members, we would move on then to the next one which stands in the name of the Hon Member again for Bosome- Freho. He is not here.

    The last one stands in the name of the Hon Member for Tano North.

    Hon Member for Tano North, you have the floor.

    Connection of Adengo and neighbouring communities to the

    national electricity grid

    Q..410. Ms Freda Akosua O. Prempeh asked the Minister for Power when the following communities would be connected to the National Electricity Grid:

    (i) Adengo (ii) Asuadei (iii) Atudrubessa (iv) Rubi (v) Assen (vi) Tano Ano (vii) Agona.
    Dr Donkor 11:40 a.m.
    Mr Speaker, Adengo, Asuadei, Atudrubessa, Rubi, Assen, Tano Ano and Agona communities do not form part of any of the on-going projects currently being executed by the Ministry. The communities would be considered when the next phase of electrification projects are being designed.
    Mr First Deputy Speaker 11:40 a.m.
    Yes, Hon Member, do you have any follow up?
    Ms Prempeh 11:40 a.m.
    Mr Speaker, a year ago, I asked the same Question of the former Hon Minister for Petroleum and Energy at the time, and he told me the same thing, that Tano Ano, Agona, Assen, and Atudurubessa do not form part of the on- going project but as soon as possible, those communities would be catered for.
    I would want to find out from the Hon Minister, whether he is aware that they have compiled the list of these communities from the Brong Ahafo Region to his Ministry, and when these communities would be catered for in the near future?
    Dr Donkor 11:40 a.m.
    Mr Speaker, the current national access to electricity is seventy six per cent, which means that there are parts of the country not connected. The intention of the State is to achieve universal access by 2020, and therefore, there is always going to be some communities that may not be connected today but which would be programmed as we get nearer to 2020.
    Mr Speaker, it is also important to know that some regions are far in excess of the national average while others fall far below the national average, and in the interest of equity and national cohesion, priority would be given to those regions that fall below the national average. This does not mean that the other regions above national average would not be considered, but in terms of prioritisation,
    and for the benefit of the cohesion of the State, more emphasis would be placed on the underserved regions to bring them to the national average.
    It is therefore in that light that the communities she has mentioned, falling within a region that is above the national average, may take a little longer to be connected. But between now and 2020 those communities would be connected.
    Ms Prempeh 11:40 a.m.
    Mr Speaker, I had the same sort of answer from the former Hon Minister. He said, “as you are aware, the Government's objective is to ensure that by the year 2020,” and so we are going to do this and that.
    Mr Speaker, I would want to find out from the Hon Minister, whether it means that between last year and now, nothing has been done? Is there no projection, and has nothing been done for these particular communities in my Constituency?
    Dr Donkor 11:40 a.m.
    Mr Speaker, the Hon Member is aware that some projects have taken place in her community as we speak. There are on-going projects. However, the addition of new communities is the issue, and we are saying that because of the State's intention of achieving universal access by 2020 all outstanding communities that have the potential of being connected to the national grid would be covered before 2020.
    Mr First Deputy Speaker 11:40 a.m.
    Yes, Hon Member, your last follow up.
    Ms Prempeh 11:40 a.m.
    Mr Speaker, I would want to find out from the Hon Minister, if he can tell this august House, when the latest or the current electrification project was undertaken?
    Mr First Deputy Speaker 11:40 a.m.
    Hon Member, I did not hear you properly. Can you go over the question?
    Ms Prempeh 11:40 a.m.
    Mr Speaker, my question is I want to find out from the Hon Minister if he can tell this House when the latest electrification project was undertaken, or even conceived to have been undertaken?
    Dr Donkor 11:40 a.m.
    Mr Speaker, I am not sure that I heard the Hon Member. I would be grateful --
    Mr First Deputy Speaker 11:40 a.m.
    Hon Member, can you speak out louder?
    Ms Prempeh 11:40 a.m.
    Mr Speaker, I thought that I was even shouting.
    I just want to find out from the Hon Minister when the newest electrification project was conceived to be undertaken? They keep on telling us that from now to the year 2020, to 2016, 2017…I would want to find out whether within this time, the Ministry had not taken any new project, and if so, when the new one was taken.
    Dr Donkor 11:40 a.m.
    Mr Speaker, we would be bringing before this House some facilities the State of Ghana is taking to enhance rural electr ification. When those agreements are brought before this House that would be the next step of new projects.
    Currently, what the Ministry is engaged in, is working on facilities that have already been approved and other projects that have been captured by the 2015 Budget in terms of shared projects. Other than that, we do not have any new projects that we are undertaking.
    Mr Agyemang-Manu 11:40 a.m.
    Mr Speaker, Questions 408 and 409, standing in the name of our Hon Colleague, Mr Kwadwo Kyei-Frimpong, were not asked. Fortunately, the Hon Member has appeared in the House, and I would crave your indulgence to permit him to ask those Questions.
    Mr First Deputy Speaker 11:40 a.m.
    Very well. [Interruption.]
    [Addressing Hon Afenyo-Markin] --
    Your Question relates to the last Question that the Hon Minister Answered.
    Hon Prof. Gyan-Baffour?
    Prof. George Y. Gyan-Baffour 11:50 a.m.
    Mr Speaker, I would like the Hon Minister to throw more light on the decision as to which communities get what? The SHEP levels, SHEP 1, 2 and SHEP 3. Infact, there is a relationship between the village size and the SHEP levels. So if the Hon Minister can explain to us which level they are and the population of those communities that fit into that SHEP, so that Hon Members would know that this community or that community they are submitting does not qualify on the particular SHEP level and maybe from subsequent SHEP levels they would be qualified.
    Otherwise, the Answer looks like it does not follow any pattern. What is the SHEP level that the Ministry is doing now and what is the qualification for a community to qualify for that SHEP level?
    Dr Donkor 11:50 a.m.
    Mr Speaker, I will be grateful if I would be allowed to take that as a Written Question.
    Mr First Deputy Speaker 11:50 a.m.
    Very well. Yes, that is the last one.
    Mr Alexander K. Afenyo-Markin 11:50 a.m.
    Mr Speaker, the Hon Minister in an earlier Answer to when certain projects are going to take off, said that the Agreement for those projects would be brought to the House. Now, Mr Speaker, my question is, these projects are supposed to be executed by the Electricity Company of Ghana (ECG) if that is correct from what
    Mr Alexander K. Afenyo-Markin 11:50 a.m.


    I know. If that is the case and the Agreement is between ECG and another company, why would the Ministry bring a private commercial Agreement for a project like that to Parliament? Can the Hon Minister give details as to why he has decided to bring this to Parliament?
    Mr First Deputy Speaker 11:50 a.m.
    Yes Hon Minister.
    Dr Donkor 11:50 a.m.
    Mr Speaker, these facilities, quite a number of them are loans that the Government of the Republic of Ghana contracts and as per the constitutional order and the Standing Orders of this House, they would have to come here. Quite often, ECG is not a party, the Ministry of Power and the Ministry of Finance are the parties to these Agreements and ECG and Volt River Authority (VRA) are only consultants to the Government in these Agreements. They are executed by Turnkey Tenki Contractors and therefore, we have to come to the House.
    Mr First Deputy Speaker 11:50 a.m.
    Thank you very much, Hon Members, the next Question, we are going back, stands in the name of the Hon Member for Bosome- Freho, who was not available at the time it got to his turn. He is now in the Chamber so he has the floor of the House.
    Connecting some communities in Bosome-Freho Communities
    to National Electricity Grid
    Q. 408. Mr Kwadwo Kyei-Frimpong asked theMinister for Power when the following communities in the Bosome- Freho District in the Ashanti Region will be connected to the National Electricity Grid:
    (i) Atobiase (ii) Minti (iii) Ahweaso (iv) Ohwimase (v) Sumdadieso (vi) Subriso.
    Dr Donkor 11:50 a.m.
    Mr Speaker, Atobiase, Minti, Ahweaso, Ohwimase, Sumdadieso and Subriso communities do not form part of any of the on-going electrification projects currently being executed by the Ministry. The communities would be considered when the next phase of electrification projects is being designed.
    Mr First Deputy Speaker 11:50 a.m.
    Hon Member, do you have any follow up questions?
    Mr Kyei-Frimpong 11:50 a.m.
    Mr Speaker, I would like to know when exactly the communities involved are going to be considered?
    Dr Donkor 11:50 a.m.
    Mr Speaker, until this House approves a credit facility or approves budgetary provisions, we would not be able to know when.
    Mr Kyei-Frimpong 11:50 a.m.
    Mr Speaker, I would like to know when exactly has the Hon Minister proposed in the next Budget or considered alternative ways of financing that Project.
    Dr Donkor 11:50 a.m.
    Mr Speaker, the Hon Member's constituency is one of the most served constituencies in terms of access to electrification in the country and therefore, as at today,these areas are not priorities for the Ministry. But in terms of our national commitment to universal access before 2020, I can assure the Hon Member that subsequent Budgets before 2020 would take care of these communities.
    Mr First Deputy Speaker 11:50 a.m.
    Hon Member, your last follow up, if any -- [Pause] -- Are you through?
    Mr Kyei-Frimpong 11:50 a.m.
    Yes, Mr Speaker.
    Mr First Deputy Speaker 11:50 a.m.
    Yes, Hon Member for Bekwai.
    Mr Joe Osei-Owusu 11:50 a.m.
    Mr Speaker, in the last answer by the Hon Minister, he suggests that Bosome-Freho Con- stituency is one of the most served communities in the country in terms of electrification. May I know exactly the percentage of electricity connection he is talking about here?
    Dr Donkor 11:50 a.m.
    Mr Speaker, I would be very happy to provide the Hon Member with the national distribution and access statistics.
    Mr First Deputy Speaker 11:50 a.m.
    Hon Member for Bosome-Freho, your second Question, that is item number 409.
    Connection to the National Electricity Grid
    Q.409.Mr Kwadwo Kyei-Frimpong asked theMinister for Power when electricity supply from the National Electricity Grid will be extended to the following communities in the Bosome- Freho District:
    (i) Anomawobi (ii) Nsese (iii) Appiakrom (iv) Damascus (v) Yain Biri (vi) Keteke.
    Dr Donkor 11:50 a.m.
    Mr Speaker, Anomawobi, Nsese, Appiakrom, Damascus, Yain Biri and Keteke communities do not form part of any of the on-going projects currently being executed by the Ministry. The communities would be considered when the next phase of electrification projects is being designed.
    Mr First Deputy Speaker 11:50 a.m.
    Hon Member, any follow up question?
    Mr Kyei-Frimpong 11:50 a.m.
    Mr Speaker, what basis does the Hon Minister have to tell us that Bosome-Freho is the most served
    Dr Donkor noon
    Mr Speaker, the Hon Member for Bekwai asked the same question and I said I was going to provide the House with the data. [Interruption.]
    Mr First Deputy Speaker noon
    Very well, Hon Members, I believe that since he has given us the assurance, he would keep to his word.
    On the other hand, if the Hon Member feels that there is a need to file a question to that effect, it can also be done. So, you can look at it from the various angles.
    I would even go as far as suggesting that you could go to the Hon Minister's office, sit down with him, have discussions and then he would provide you with the information that you need.
    Yes, Hon Member?
    Mr Adagbila noon
    Mr Speaker, the extension of power to these communities, and some communities are yet to be hooked. In one vain, I have information from his Ministry, telling me that, the Ministry of Power lacks the competence to do certain things. Has the Ministry the competence to find out the value gained from extending power to these communities? What are the benefits of the extension of power to all these communities, when he has already stated to me directly that, for example, he lacks the competence to quantify the loss of power outings?
    Mr First Deputy Speaker noon
    Yes, Hon Minister?
    Dr Donkor noon
    Mr Speaker, the last part of the Hon Member's Question emanates from his main Question, whose Written Answer he would have.
    Mr Speaker, I want to make the distinction between the saying that, the Ministry does not have the competence to compute the quantum of the loss arising out of load shedding from the Ministry's competence to know or compute or assess the benefit of extension of electricity to various communities.
    Mr Speaker, it is the democratic right of every community in this country to have access to electricity. However, the exercise of this right is constrained by the availability of resources at any particular time, and therefore, the right becomes an objective.
    And that is why the Ministry says that, by the year 2020, the national objective, the objective of the State of Ghana, is to have universal access to electricity. And Mr Speaker, for the purpose of clarity, universal access is defined as ninety per cent or more, not necessarily 100 per cent. There are some communities that cannot be connected to the national grid for reasons of geography, topography and other reasons.
    Mr Speaker, we are also aware that extension of electricity to communities is not just a political imperative but it is an economic imperative. The extension of electricity to communities enhances the establishment of micro enterprises in these communities. If this country desires to slow down the rural-urban migration, then it is imperative that we establish conditions that would favour the people from rural areas such as, where some of us come from, being able to undertake various aspects of micro entrepreneurial and stay in their communities.
    So, we are aware of the importance of extending electricity to rural communities. In any case, it also provides for national cohesion and the Ministry is very aware of this.
    Thank you, Mr Speaker.
    Mr First Deputy Speaker noon
    Hon Members, this brings us to the end of Question time. Hon Minister, thank you for attending upon this House. You are discharged.
    Hon Deputy Majority Leader?
    Mr Agbesi noon
    Mr Speaker, item number
    9.
    Mr First Deputy Speaker noon
    Item number 9 on the Order Paper.
    Hon Minister for Finance?
    Mr Agbesi noon
    Mr Speaker, with your permission and kind indulgence of my Hon Colleagues, the Hon Deputy Minister for Finance can stand in for the Hon Minister for Finance.
    Mr First Deputy Speaker noon
    Hon Deputy Minister?
    MOTIONS noon
    Mr Cassiel Ato Baah Forson (on behalf of the Minister for Finance) noon
    Mr Speaker, I beg to move that not- withstanding the provisions of Standing Order 128 (1) which require that when a bill has been read a second time it shall pass through a consideration stage which shall not be taken until at least forty-eight hours have elapsed, the consideration stage of the Petroleum Revenue Management (Amendment) Bill, 2015 may be taken today.
    Mr First Deputy Speaker noon
    Any seconder?
    Mr James K. Avedzi noon
    Mr Speaker, I beg to second the Motion.
    Question put and Motion agreed to.
    Mr First Deputy Speaker noon
    Yes, Hon Deputy Majority Leader?
    Mr Agbesi noon
    Mr Speaker, item number
    10.
    Mr First Deputy Speaker noon
    Hon Members, item number 10 -- Petroleum Revenue Management (Amendment) Bill, 2015 at the Consideration Stage.
    BILLS -- CONSIDERATION STAGE noon
    Mr First Deputy Speaker noon
    clause 2.
    Clause 2 -- Section 7 of Act 815 amended.
    Hon Chairman of the Committee?
    Chairman of the Committee (Mr James Klutse Avedzi) noon
    Mr Speaker, the Committee is proposing the deletion of clause 2. Mr Speaker, the reason for the proposal is that the provision in the principal enactment is adequate that we do not think that there should be any amendment which proposes that the petroleum revenue should be paid directly into the Petroleum Holding Fund, without netting off the funds that are supposed to be paid to the national oil company.
    So, I beg to move, we are proposing that Clause 2 should be deleted completely.
    Question put and amendment agreed to.
    Mr First Deputy Speaker noon
    Very well.
    Hon Members, please, address the Chair.
    Mr Osei-Owusu noon
    None

    Hon Member for Bekwai?
    Mr Joseph Osei-Owusu 12:10 p.m.
    I thank you Mr Speaker for your kind indulgence.
    Mr Speaker, this House is guided by the rules and the Constitution. Per our rules and the Constitution, a certain number of Hon Members must be present before we can transact business and take a decision. I am alleging that at this point in time, we do not have a quorum to continue to do business in the House and I guess Mr Speaker should ensure that the rules are met.
    Mr First Deputy Speaker 12:10 p.m.
    Very well.
    By the same rules, I direct that the bell be rung. Hon Members, we move on to clause 3.
    Clause 3 ordered to stand part of the Bill.
    Mr First Deputy Speaker 12:10 p.m.
    Clause 4.
    Clause 4 -- Section 11 of Act 815 amended.
    Chairman of the Committee (Mr James K. Avedzi) 12:10 p.m.
    Mr Speaker, I beg to move, clause 4, paragraph (a), lines 3 and 4, delete “Benchmark Revenue” and insert “actual petroleum receipt net of the national oil company's share”.
    Mr Avedzi 12:10 p.m.
    Mr Speaker, in the principal enactment, Section 11 talks about the distribution of the Petroleum Revenue and that some percentage of that revenue must be transferred to the Petroleum Holding Fund.
    However, this is based on the Benchmark Revenue which means that in a particular year, where Actual Revenue is far below the Benchmark Revenue, the Petroleum Funds which are the Heritage and the Stabilisation Funds might not even receive any amount at all. Where the Actual Revenue is more than the Benchmark Revenue, they would receive the share of 30 per cent in addition to the excess.
    The idea is that, 30 per cent or not less than 30 per cent which should go to both the Stabilisation and Heritage Funds should be based on the actual receipt and not the Benchmark Revenue so that the issue of -- if there is a less amount of actual as compared to the Benchmark Revenue which rises, the Petroleum Revenue, the Heritage and then the Stabilisation Funds could both receive the share of that Actual Revenue which would not be less than 30 per cent.
    If we maintained the one we have in the Act, it would happen that, for instance, this year, where the revenue is falling far below the Benchmark Revenue, the Petroleum Heritage Fund and the Stabilisation Fund might not receive any amount at all.
    That is the brain behind changing the Benchmark Revenue to the actual receipt less or net of the amount that would be paid to the national oil company which is Ghana National Petroleum Corporation
    (GNPC).
    Mr First Deputy Speaker 12:10 p.m.
    Very well.
    Hon Members, I think I would put the Question.
    Yes, Hon Minority Leader?
    Mr Kyei-Mensah-Bonsu 12:10 p.m.
    Mr Speaker, the Hon Chairman of the Committee is trying to explain something to me in sign language and I am not exactly following what he is saying. My worry, as I indicated yesterday, is what to do with the Heritage and Stabilisation Funds and my reaction is that, nothing should be done to undermine the holdings in the Heritage and Stabilisation Funds. I know people are concerned that we should not hold funds down but that we should rather employ those funds to solve problems of the day.
    My thinking is that, it is not for nothing that we have that provision to hold something for the generations yet unborn. So, anything to undermine the Funds holdings should not be tolerated in this House.
    I know that last year when we had problems, some of these suggestions came from people outside this House, including the General-Secretary of the ruling party and I am of the firm opinion that we should not do anything to undermine the Heritage and Stabilisation Funds. That was the gravamen of my argument yesterday and I would still insist that we should tread very cautiously in dealing with the Stabilisation and Heritage Funds.
    Mr Avedzi 12:10 p.m.
    Mr Speaker, the issue of funds into the Heritage and Stabilisation Funds still holds. What we are doing now is to ensure that any actual revenue that is realised from the petroleum revenue which is not less than 30 per cent go to both the Stabilisation and Heritage Funds. The way it is now means, 30 per cent of Benchmark Revenue. The assumption here is that if Benchmark Revenue is 100 million, 30 per cent of that which is 30 million would go into both the Stabilisation and Heritage Funds. If the actual is exactly 100 million, then 30 million would be shared between the Stabilisation and Heritage Funds.
    In a year, where the actual is more than 100, 30 per cent of Benchmark Revenue which is 30 million would be paid into both Stabilisation and Heritage Funds. The excess would be added to both Stabilisation and Heritage Funds and that is the current situation.
    However, in a particular year, where the actual is far less than the Benchmark Revenue, let us assume that the actual is 80 million, what would go into Stabilisation and Heritage Funds would be only 10 million.
    In a situation where the amount is far less, say 60 million, nothing would go to both Stabilisation and Heritage Funds. We want to avoid that situation so that the actual, whether it is high or low, 30 per cent of that should be sent into both the Stabilisation and Heritage Funds. That is the solution that we are providing here. So, money flowing into the Stabilisation Fund is now assured and constant.
    Whatever amount is the actual, 30 per cent would go there unlike the current situation where if the amount falls below the Benchmark Revenue, they would not receive anything at all. That is all we want to correct here. So, I think the flow into the Heritage and Stabilisation Funds is rather assured by this amendment.
    Mr First Deputy Speaker 12:10 p.m.
    So, do I understand you to be saying that with this proposed amendment there would not be the question of it being below the Benchmark and therefore, nothing flowing into the Funds?
    Mr Avedzi 12:10 p.m.
    Exactly, that is the solution. So even if it is only 50 that is realised as the actuals, 30 per cent would go. If it is 40, 30 per cent would go, if it is 200, 30 per cent would go. So there is a constant flow into the Funds no matter what amount is realised as the actuals.
    Prof. George Y. Gyan-Baffour 12:10 p.m.
    Mr Speaker, I think the principle here makes sense but the point is that actuals are determined at the end of the process, so are you going to wait until the end before you determine the actual and transfer it? What are you going to do? Are you going to transfer it in real time? How do you determine the actuals? Every budget is based not on the actuals but the expected. So, if the fluctuations come in, so be it. Why are you going to talk about actuals when you do not know the actuals?
    MrAvedzi 12:20 p.m.
    Mr Speaker, the Hon Member's question rather strengthened my position. If we are using the Benchmark Revenue, we would want to see that by the close of the year, we have attained the Benchmark Revenue. So, it would be difficult for us to even share proceeds into the three Funds if we do not know whether we have hit the Benchmark Revenue or not.
    The current one, where there is a lifting, whatever money that is realised is distributed between the three; 30 and 70, and that is rather assured than basing it on the Benchmark Revenue. This is because, the Benchmark Revenue is for the year and if we lift 20 per cent of it in the first quarter, we would want to see that by the second quarter what percentage of the Benchmark Revenue has lifted. We would want to see by the close of the year what percentage of the Benchmark Revenue has been lifted before we do our distribution.
    rose
    Mr First Deputy Speaker 12:20 p.m.
    Yes, Hon Minority Leader?
    Mr Kyei-Mensah-Bonsu 12:20 p.m.
    Mr Speaker, first of all, we should be asking ourselves what the Benchmark Revenue is. The Benchmark Revenue is not calculated at the end of the year. The Benchmark Revenue is the price per barrel as calculated upon what might have been received some years back. The calculation is based on that to establish the Benchmark Revenue. And that is it. The Hon Deputy Finance Minister, cannot be shaking his head.What is the Benchmark Revenue?
    Mr Speaker, the second thing is, by this amendment he is suggesting to us that necessarily there must be a share to the national oil company. Mr Speaker, that is not eternal and so, it cannot be part of this. What we agreed to do was for the time being, shore the national oil company up and there would arrive a time that, that share would no longer flow to them. Yes, that is what we agreed on. He is saying that we should insert in Benchmark Revenue, actual petroleum receipts, net of the national oil company share.
    And I am saying to him that, we make what is to go to the national oil company a necessary share of the revenue -- [Interruption] --No, that is only a temporal arrangement. We decided that a time may come and this House would stop that when we think they are sufficiently resourced and well positioned to do their own business. It cannot be part of this and in particular, when they themselves are refusing to come to this House to render accounts to us. It cannot be part of this and so, Mr Speaker, I disagree with this construction.
    Mr Avedzi 12:20 p.m.
    Mr Speaker, please permit me to read the section 7 of the principal enactment: “Carried and participating interest”.
    7.(1) “Revenue due from the direct or indirect participation of the Republic in petroleum operations, including the carried and participating interests shall be paid into the Petroleum Holding Fund”.
    (2) “The payment into the Petroleum Holding Fund shall be net of
    (a) the equity financing cost, including advances and interest on the carried and participating interests of the Republic; and
    (b) the cash or the equivalent barrels of oil that shall be ceded to the national oil company out of the carried and participating interests recommended by the Minister and approved by Parliament”.
    Mr Speaker, what this section is talking about is that, whatever petroleum revenue is realised, first of all you have to net off equity cost to the national oil company and the balance is paid into the Petroleum Holding Fund, then distribution is made in the Petroleum Holding Fund, 70 per cent to the ADFA to support the budget and the 30 per cent to be sent to both Stabilisation and Heritage Funds. That is the meaning.
    The amendment we are proposing is that, the Ministry of Finance wanted to change that procedure and we said no. The reason is what the Hon Minority Leader is saying, that we want to ensure that the oil company is given enough resources so that they can also participate and even go to the market and borrow on their own balance sheet. So, if the Ministry wants to change that provision we would not. That is why we have abandoned the clause 2 of the Bill which we have
    deleted; the clause 2 is the new proposal, the Ministry is coming up to change that position and that is why we deleted that.
    The clause 4, is saying that whatever should go to both the Stabilisation and the Heritage Funds is based on the Benchmark Revenue. But we are saying that, if in a particular year the actual revenue is more than the Benchmark Revenue, Stabilisation and Heritage Funds would receive the 30 per cent all right and take the excess in addition. That is good, but where the actual revenue is far less than the Benchmark Revenue, they would not receive anything at all. Is that a good situation? We are saying no, let us change it to actual revenue.
    The percentage which is the 30 should not be based on the Benchmark Revenue but should be based on the actual revenue so that whatever amount is the actual that we realise in the year, 30 per cent is assured to be sent to both Stabilisation and Heritage Funds. Unlike the current situation where depending on the actual, they might receive some --
    Mr First Deputy Speaker 12:20 p.m.
    Hon Chairman, may I ask one question? Do you have statistics which would show what the flow has been like? This is because in the original situation, if it exceeds the Benchmark Revenue, the percentage is applied and then the excess also goes in there. How often does that happen, as against what you are proposing now which should be 30 per cent of whatever is in excess of which the benchmark would not matter now? Do you understand me? So, how do we go around that?
    Mr Avedzi 12:20 p.m.
    Mr Speaker, we do not have the data here but I think the Ministry can
    provide that data to support that argument. But as an example, this year, we all know what is happening, where the Benchmark Revenue which was estimated very high and because of the drop in the price of crude on the world market, we would not even hit the Benchmark Revenue. So there is a possibility that Stabilisation and Heritage Funds might not receive anything at all this year. This is because if we do not hit the Benchmark Revenue, they will not receive anything.
    rose
    Mr First Deputy Speaker 12:20 p.m.
    Yes, Hon Gyan-Baffour?
    Prof. Gyan-Baffour 12:20 p.m.
    Mr Speaker, no budget is done based on actual. Never, it is done on the expected. The only problem is that, may be his estimation is not right. If his estimation is not right, he should tell us so. The point is that we do not rely on an outlier. This year was an outlier and it just does not happen very often as Mr Speaker said. So, if it is zero or nothing that is fine. There would be a year where it can come up. You do not have to say I am going to do a budget based on the actual revenue that I get.
    This is exactly what we have tried to do. Let us do the Benchmark Revenue better and define it in a better way so that we do not have to go by actuals but a definition that can give an expectation estimation at the beginning of the year. You do not wait until the end of the month or the end of a lifting before you know how much money you are going to get.
    Mr Avedzi 12:20 p.m.
    Mr Speaker, first of all, this is not a budget. This is a law we are crafting and it is not a budget. It is a formula and it is saying that share 70, 30 of actual. It is not a budget and so, that one must be --
    Prof. Gyan-Baffour How do you tell the country at the beginning of January that this is what we are going to get? How do you do that?
    Mr Avedzi 12:30 p.m.
    Mr Speaker, the estimation that was done was based on the formula that Parliament approved. In fact, we said no when they were even proposing for the change in the formula, this is because, the formula is the best, that; seven year average, four years behind, the current and projection of two years. That is the formula and it is working alright.
    Mr Speaker, the Minister used that formula in estimating the Benchmark Revenue but what happened? Who knew that the price of crude oil would drop more than 50 per cent in the market? That will not be determined or dictated by the formula, no matter how best the formula is.
    Prof. Gyan-Baffour 12:30 p.m.
    That is why I said it is an outlier and so we should not use an outlier to make a law.
    Mr First Deputy Speaker 12:30 p.m.
    Can we hear from the Hon Deputy Minister for Finance?
    Mr Forson 12:30 p.m.
    Mr Speaker, this proposed amendment is to ensure that we will be able to save as a country, no matter what happens to the Benchmark Revenue.
    Mr Speaker, for instance what is happening this year is that, we have not been able to save at all or transfer anything to the Heritage or the Stabilisation Funds. In going forward, the Ministry is of the
    opinion that, inspite of what will happen, we will have to come out with something that we will be able to put aside into the Heritage and Stabilisation Funds. It rather strengthens our position.
    Mr Speaker, under Petroleum Revenue Act, 2011, the “actuals” actually happen as and when we lift and so this is not budgeting. This is different from the Benchmark estimation. In fact, the Benchmark Revenue rather estimates the “actuals”. But, in this case, we want to be very precise by using the “actuals” as and when we lift.
    For instance, we will be lifting first, second, third, and fourth quarters and so as long as we lift “X” amount of money, we will be able to then look at the calculations and put aside what is to go into the Heritage and Stabilisation Funds and then transfer the rest to the ABFA. That is what we are trying to explain and propose to Parliament to consider and approve.
    Mr Kyei-Mensah-Bonsu 12:30 p.m.
    Mr Speaker, I cannot bring myself to appreciate the points that are being made by both the Hon Chairman of the Committee and the Hon Deputy Finance Minister.
    Mr Speaker, the Petroleum Revenue Management Act, 2011 provided that 30 per cent of revenue should go to the two Funds and beyond that, if there is any excess, that should go to the Funds, not ABFA, but the Heritage Fund. It seems to me that there is an over-emphasis on Section 11, and with your kind permission, I beg to quote:
    “The Ghana Petroleum Fund shall both receive from the Petroleum Holding Fund, petroleum revenue in excess of the Annual Budget Funding Amount”
    Mr Speaker, that is what is being addressed now. But, it is not the only source. The principal source is, whatever revenue ensues. That is why I am unconvinced by the argument that, in a particular year, we can have a situation where nothing may go to the Fund. Where is it?
    Mr Speaker, Section 10 of the Petroleum Revenue Management Act, 2011 provides, and with your kind permission I beg to quote:
    “1) A Ghana Heritage Fund is hereby established.
    3) The Ghana Heritage Fund shall receive from the Petroleum Holding Fund a percentage of petroleum revenue which shall be determined by Parliament as savings for the purpose of this Act.”
    Mr Speaker, that is the 30 per cent and so whatever revenue, both Funds should receive 30 per cent. That is whether or not it is below the Benchmark. That is the understanding of Section 10 (3). It is not only over and above the benchmark. So what understanding is coming into this?
    Mr Speaker, the other dangerous component which, perhaps, consciously or unconsciously they want to introduce, and we have really fought it is that, whatever revenue that comes to the country is State Funds, which should necessarily go into the Consolidated Fund and thereafter, to have an arrangement if anything should go to support the National Oil Company, to do so.
    What has been crafted by this is to the effect that, before the money hits the Holding Fund, the Oil Company should
    take their own money away. That should not be tolerated. That is the issue we raised that it was wrong,however,it got into the Act. This is because, we debated it on the floor and by this construction now, when we say that it is the net that should go—I beg to read:
    “actual petroleum receipt net of the national oil company's share”
    Mr Speaker, we are further streng- thening the argument for them that they should take their money before, but that is wrong. It should go into the Consolidated Fund, which is what the National Oil Company is doing and we should resist it because the Hon Minister for Finance should have control. He should be able to tell. It should not be that because that is the conduit, they take their money and the net comes to the Consolidated Fund. It is wrong.
    Mr Avedzi 12:30 p.m.
    Mr Speaker, I think the Hon Minority Leader has brought two issues here. The first one is about the share of the revenue to the Stabilisation and the Heritage Funds. He also brought another issue about whether the amount that goes to the Holding Fund should be net of the money that goes to Ghana National Petroleum Company (GNPC).
    That was the Ministry's proposal in the Bill, and the Committee is saying that, the reason why we are insisting that GNPC should receive their share before the net goes to the Holding Fund is to strengthen the position of the oil company for them to use that one to even go to the market and borrow on their balance sheet.
    Mr Speaker, in fact, once the investors looked at that provision in the Act, and they know that the flow of money for GNPC is assured, that it will not hit the Consolidated Fund before coming back to them, they are comfortable. They are
    Mr Avedzi 12:30 p.m.


    sure that whatever revenue is coming from petroleum, the portion that goes to GNPC will not come to Government first and therefore, if they are giving any money to GNPC, they are sure that they can get the money back. If we do that, we are going to have everything done that will affect the interest and the power of GNPC to go and borrow even on their own.

    This is because the investors will not be comfortable that the money will hit the Consolidated Fund which might not come back to GNPC. That is the fear and in fact, GNPC told us that their investors were comfortable when they showed them that clause because they know that GNPC has a constant flow of funds that if they lend money to GNPC, they can get the money back.

    Mr Speaker, what we have in the Act should remain. That is why the Committee was proposing that we should not change that one. That is the first aspect of the argument by the Minority Leader.

    Mr Speaker, the second part of his argument is that, if one reads the Act, under section 18, and I beg to quote:

    “The Annual Budget Funding Amount from petroleum revenue shall not be more than seventy per cent of the Benchmark Revenue.”

    Mr Speaker, that Benchmark Revenue as I early on explained is there and we have determined that the portion that goes to the Stabilisation and Heritage Fund should not be less than 30 per cent. So, if we look at 70 per cent and 30 per cent, that makes up the 100 per cent. We are saying that, whenever “actual” is realised, whether that “actual” is up to the 70 per cent, which is the Benchmark Revenue, we will still take a portion of that and send

    it to Heritage and Stabilisation Funds. That is a better rendition.

    Mr Speaker, where the “actual” is not up to the Benchmark Revenue, Heritage and Stabilisation Funds get nothing.

    Like this year, what we are getting from petroleum revenue would not meet the Benchmark Revenue. In that case, Ghana Stabilisation Fund and Ghana Heritage Fund would receive zero. That is wrong and it is not good for us. If we make the amendment, a portion of whatever is realised would go into the Ghana Stabilisation Fund.

    I have seen that if the Hon Minister for Finance is able to provide the data for us, we would appreciate this amendment better than I am explaining.

    Thank you.
    Mr Forson 12:40 p.m.
    Mr Speaker, in the principal enactment, we noticed that from section 23-- Currently, the Ghana Petroleum Fund which is made up of the Heritage and Stabilisation Funds only receive funds in excess of quarterly Annual Budget Funding Amount (ABFA). What we are trying to correct now, that is the new proposal is to ensure that, we would be able to have a constant 30 per cent of actual receipts and also ensure that money in excess of the ABFA would also flow to the Ghana Petroleum Fund.
    Mr Speaker, if we look at section 23, it explains where we are trying to correct. Clearly, the provisions we have in section 23 show that we cannot transfer any amount other than the excess of ABFA into the Ghana Petroleum Fund.
    Mr First Deputy Speaker 12:40 p.m.
    Hon Members, I think that it would be advisable for us to defer for further consideration of this proposed amendment. [Interruption.]
    Order! Order! I think it would be appropriate for us to defer further consideration of this amendment so that we go back and look at it, guided by the data that the Ministry of Finance would provide and then we chart a way forward. I so direct.
    Mr First Deputy Speaker 12:40 p.m.
    Hon Members, we have another proposed amendment for clause 4; can we look at it?
    Mr Avedzi 12:40 p.m.
    Mr Speaker, I beg to move, clause 4, paragraph (b), line 2, before “Thirty” insert “Not less than” and further in lines 2 and 3, delete “to the Ghana Petroleum Funds”
    Mr Speaker, the new rendition would read;
    “Not less than 30 per cent of the amount transferred under sub- section (2) shall be transferred to the Ghana Heritage Fund and the balance shall be transferred into Ghana Stabilisation Fund”.
    Mr Speaker, this is actually based on amendment proposed in the earlier one which is under section 2 that whatever --
    Mr First Deputy Speaker 12:40 p.m.
    In that case, can we defer both since they are intertwined so that at the appropriate time, we can look at both of them and address the issues concerned.
    We move on to clause 5. Hon Members, there is no advertised amendment with regard to clause 5.
    Clause 5 ordered to stand part of the Bill.
    Clause 6 -- Section 16 of Act 815 amended.
    Mr Avedzi 12:40 p.m.
    Mr Speaker, I beg to move clause 6, delete.
    Mr Speaker, this is consequential to the deletion of clause 2 as we did earlier.
    Mr First Deputy Speaker 12:40 p.m.
    Very well.
    Question put and amendment agreed to.
    Clause 6 as amended ordered to stand part of the Bill.
    Clause 7 -- Section 17 of Act 815 amended.
    Mr First Deputy Speaker 12:40 p.m.
    Hon Members, there is no proposed amendment advertised. I will put the question --
    Yes, Hon Member for Wa West?
    Mr Chireh 12:40 p.m.
    Mr Speaker, if you look at the Bill, there is clause 7, even though they have not advertised it here. The rendition is that the principal enactment is amended in section 17 by the insertion of two new subsections. This is because if you look at it, there was only one, subsection under section 17 and we are adding two new ones, so we would need to specify that there are two new subsections instead of just saying insert -- They are new. That is what I would want the draftspersons to take note of.
    Mr First Deputy Speaker 12:40 p.m.
    Chairman of the Committee, how do you respond to that?
    Mr Avedzi 12:40 p.m.
    Mr Speaker, I do not think this is an issue that we should debate.
    Mr First Deputy Speaker 12:40 p.m.
    Very well.
    I direct the drafters to deal with that issue as appropriate.
    Yes, Hon Minority Leader?
    Mr Kyei-Mensah-Bonsu 12:40 p.m.
    Mr Speaker, the original Act deals with a specific date. Section 17 provides:
    “The Minister shall not later than September 1st of each year estimate and certify the Benchmark Revenue using the formula set out in the First Schedule”.
    What is being added is that; the Minister may recommend to Parliament a revision of the Benchmark Revenue if it becomes evident that unexpected petroleum price movement or production has resulted or is unlikely to result in a gross over projection or under projection of the Benchmark Revenue.”

    In the Parent Act, we are dealing with September 1st, but this new amendment comes a bit open-ended and I am asking

    whether it deals with the same September 1st issue. We should not forget that if we look at the new subsection (3) that we are dealing with, it then tells us that:

    “The Minister shall make the recommendation under subsection (2) at the time of presenting the Annual Budget Estimate or during the mid-year review”.

    That is the reason I am a bit confused there. In other words, how do we relate to the September 1st?
    Mr Forson 12:40 p.m.
    Mr Speaker, normally, on September 1st, we would come out with the projections on the Benchmark Revenue, but what we are proposing to amend is to look at it after there is an over projection for the Hon Minister to be able to revise the Benchmark Revenue.
    Mr Avedzi 12:40 p.m.
    Mr Speaker, I think in addition to what the Hon Deputy Minister said, it is because of what happened this year where we realised that the Benchmark Revenue would be estimated all right but after the Benchmark Revenue is estimated, conditions in the market would affect drastically the values that are derived by the use of the Benchmark Revenue.
    So, the Hon Minister can come back by this provision and say because of “A”, “B”, “C”, “D” that is happening in the market which would be after the September 1st, to brief the House that this is the situation. So, it is not going to be before; it could be after the September 1st, maybe, round to the end of August in the following year.
    So, within that one year period, whatever happens, the Hon Minister would come back to the House. That is what we did.
    Mr First Deputy Speaker 12:40 p.m.
    Hon Minority Leader, are you all right with the explanation?
    Mr Kyei-Mensah-Bonsu 12:50 p.m.
    Mr Speaker, the problem is that, one deals with the time of presenting the Budget which normally is late October or maybe, the first few weeks in November.
    Mr Speaker, we are dealing with a time span of just about one month or a maximum of two months. So, are we saying that within that, we ought to have seen the variation and come to Parliament with a new proposal?
    I am comfortable, for instance, with the mid-year review which is a reasonable time. But to say that between September 1st and October ending, he can come and vary the benchmark, I do not think it is a reasonable cause at all. [Interruption.] The mid-year review period, in my view is a reasonable time frame.
    Mr First Deputy Speaker 12:50 p.m.
    Very well. Hon Members, I would put the Question.[Interruption] No, sorry.
    I should put the Question with regard to clause 7, standing part of the Bill. I would put the Question again.
    Clause 7 ordered to stand part of the Bill.
    Clause 8 -- Section 21 of Act 815 amended.
    Mr Avedzi 12:50 p.m.
    Mr Speaker, I beg to move, clause 8, paragraph (a), line 5, after “plan” delete “or” and insert “and”.
    Mr Speaker, the new rendition will read 12:50 p.m.
    “…with a long-term national development plan and with sections 3 and 5”.
    Not sections (3) to (5). Let me take it again.
    “…with a long-term national development plan and with sections (3) and (5)”.
    Instead of ‘or with sections (3) to (5)'.
    Mr First Deputy Speaker 12:50 p.m.
    Very well. I will put the Question --
    rose
    Mr First Deputy Speaker 12:50 p.m.
    Yes, Hon Member for Wa West?
    Mr Chireh 12:50 p.m.
    Mr Speaker, I have been reading the amendment together with the Bill. He said that and I beg to quote:
    “…a minimum of 70 per cent of the Annual Budget Funding Amount shall be used for public investment expenditures consistent with the long- term national development plan or subsections (3) to (5)”.
    Which subsections is he talking about? Are they in the Act itself or the Bill? [Interruption.] Are they in the Act or the Bill?
    Mr Avedzi 12:50 p.m.
    Mr Speaker, they are in the Act. If you look at section 21 of the Petroleum Revenue Management Act, it talks about the use of the Annual Budget Funding Amount which has subsections (1), ( 2), (3), (4) and (5). The amendment here is saying that and I beg to quote:
    “…a minimum of 70 per cent of the Annual Budget Funding Amount shall be used for public investment expenditure consistent with the long-term national development plan or with subsections (3) and (5)”.
    The subsection (3) talks about and I beg to quote:
    Mr Chireh 12:50 p.m.
    Mr Speaker, if you look at the amendment he has made, he says, after “plan” insert “and” instead of “or”. But what he is now saying is slightly different because where is this “and' going to be and why is he changing ‘or' to “and”? If we do it that way -- he said subsections (3) to (4) [Interruption.] Yes, but I am saying that what he is saying now is different because where is the
    change coming in and why is he changing “or” to “and”?
    What is the difference? In addition to it, he is changing “to” to “and”. [Interruption] -- There is a subsection (4) in between. So, you cannot have ‘and (3) unless he want to specify that only subsections (3) and (5) are the ones that are affected by this subclause.
    Mr Kyei-Mensah-Bonsu 12:50 p.m.
    Mr Speaker, the proposal from the Hon Chairman is totally out of place -- [Interruption]-- In respect of the change of the words, ‘and' for “or”. The “or” should remain. That one is out of place. The new one that he argued; “the (3) and (5)” -- He is adding subsection (5) but he has no business changing everything because he only said that, that plan should conform to a long- term national development plan.
    Where we do not have it, then it should be in compliance with subsections (3) and (5). That is it.
    Mr Avedzi 12:50 p.m.
    Mr Speaker, I believe that is the right position.
    Mr First Deputy Speaker 12:50 p.m.
    Very well. So, you would effect the necessary amendment to your proposed amendment.
    Mr Avedzi 12:50 p.m.
    Mr Speaker, the new rendition of the amendment is, clause 8, paragraph (a), line 5, delete “to” between (3) and (5) and replace with “and”.
    So, the new rendition would be,
    “(b) For any financial year, a minimum of 70 per cent of the Annual Budget Funding Amount shall be used for public investment expenditures consistent with the long-term national development plan or with subsections (3) and
    (5)”.
    Mr First Deputy Speaker 12:50 p.m.
    All right. Hon Members, I would put the Question.
    Question put and amendment agreed to.
    Clause 8 as amended ordered to stand part of the Bill.
    Clauses 9 and 10 ordered to stand part of the Bill.
    Clause 11 -- Section 48 of Act 815 amended.
    Mr Avezi 1 p.m.
    Mr Speaker, I beg to move, clause 11 paragraph (b), subparagraph (i), line 3, after “by” insert “and”.
    Mr Speaker, so the new rendition would be 1 p.m.
    “(b) a report from the Minister:
    i) Describing the stage of the implementation of the programmed activities funded by and the expenditure incurred on the activities covered by the Annual Budget Funding Amount…”
    Question put and amendment agreed to.
    Clause 11 as amended ordered to stand part of the Bill.
    Clause 12 ordered to stand part of the Bill.
    Clause 13 -- Section 57 of Act 815 amended.
    Mr Avedzi 1 p.m.
    Mr Speaker, I beg to move, clause 13, add the following new sub- clause:
    Mr Avedzi 1 p.m.


    “(2) subject to section (1), the budget on the annual programme of the Accountability Committee shall be a charge on the Annual Budget Funding Amount for each financial year”.

    Mr Speaker, as we discussed yesterday at the Second Reading of the Bill, no provision was made for the funding of the Public Interest and Accountability Committee (PIAC).

    The Committee said that we should find a source of funding, which should be part of the Annual Budget Funding Amount (ABFA). So, we propose a new subclause as follows:

    “Subject to section (1), the budget on the annual programme of the Public Interest and Accountability Committee shall be a charge on the Annual Budget Funding Amount for each financial year.”
    Mr Chireh 1 p.m.
    Mr Speaker, I have seen this “Accountability Committee”. Is there a definition for it? Or do we want to say the full name -- The Public Interest and Accountability Committee?
    So, if he could, I would want a further amendment to capture the name of the Committee in full as it exists in the Act. But if we just make it “Accountability Committee”, it is not what has been described in the Act. So, it should be the full name of that committee.
    Mr Avedzi 1 p.m.
    Mr Speaker, it would not spoil anything. It would make it better. This is because this is the only “Accountability Committee” in the Act, but I agree with him.
    Mr Speaker, I beg to move, clause 13, subclause (2), line 2, delete “ Account- ability Committee” and insert “Public Interest and Accountability Committee”.
    Prof. Gyan-Baffour 1 p.m.
    Mr Speaker, I think it is a very good idea. My concern is that whatever budget they bring, do we charge it against it or could the budget be varied? Did the law just say that whatever thing they bring, we should just charge it? Is that what it says here? What is the controlling factor?
    Mr Avedzi 1 p.m.
    Mr Speaker, their budget would definitely be agreed between PIAC and the Ministry of Finance. Then whatever amount is agreed on, it is charged to the ABFA. So, it is not any amount that they bring which should be accepted and charged against the ABFA.
    Mr Speaker, I beg to move, clause 13, subclause (2), delete”section (1)” and insert “subsection (1)”.
    Mr First Deputy Speaker 1 p.m.
    Very well.
    Mr Chireh 1 p.m.
    Mr Speaker, the explanation he gave was about the charge on ABFA. It is because the argument by the Committee was that, PIAC has not been fully budgeted for and so it is the Ministry that has to find money outside. This is why they have put it this way, so that the charge would be on that. From that, they would always bring their budget based on this amendment and it would be taken from the ABFA.
    Mr Frist Deputy Speaker 1 p.m.
    Hon Majority Leader, you were up on your feet earlier.
    Mr Kyei-Mensah-Bonsu 1 p.m.
    Mr Speaker, I was really wondering why the Hon Chairman beat a quick retreat.
    The Hon Member for Wa West wanted clarification in respect of the use of the words, “Accountability Committee”. He said to us that he felt that, perhaps, we
    needed to write the committee's name in full, that is the Public Interest and Accountability Committee.
    Mr Speaker, but under the interpreta- tion column 1 p.m.
    “Accountability Committee means the Public Interest and Account- ability Committee established under section 51.”
    All that the Hon Chairman needed to have told the Hon Member was that it has been defined. Then he said that; “it does not spoil anything”. Mr Speaker, it spoils something. So, he should stick to his original position and not behave like a timorous soul. He should stick to what he proposed.
    Mr Avedzi 1 p.m.
    Mr Speaker, I would not comment on this. [Laughter.]
    Mr Chireh 1 p.m.
    Mr Speaker, I do not have a copy of the Act here, so I wanted them to lend me one of theirs so that I would not have raised the issue to confuse him.
    Mr Kyei-Mensah-Bonsu 1 p.m.
    Mr Speaker, so, the original position should hold. The Hon Chairman should gather courage.
    Mr First Deputy Speaker 1 p.m.
    Hon Chairman, if you say you are not going to comment, how do we move forward?
    Mr Avedzi 1 p.m.
    Mr Speaker, as I said, there is only one “Accountability Committee” in the Act, so I stand by the original rendition of the proposed amendment.
    I so move.
    Question put and amendment agreed to.
    Clause 13 as amended ordered to stand part of the Bill.
    Clause 14 ordered to stand part of the Bill.
    Clause 15 -- Section 61 of Act 815 amended
    Mr Avedzi 1:10 p.m.
    Mr Speaker, I beg to move, clause 15, paragraph (d), delete.
    Mr Speaker, paragraph (d) refers to a new definition provided for the Investment Manager. We think that the “Investment Manager” has already been defined in the Bill.
    On page 30 of the Petroleum Revenue Management Act, 2011, under Interpreta- tion; “we have, investment manager” means the Bank of Ghana or any person or entity appointed as investment or portfolio manager for purposes of this Act;”
    So, there is no need to define it again. [Interruption.]The original is on page 30 of the Act.
    Mr First Deputy Speaker 1:10 p.m.
    Very well.
    Yes, Hon Minority Leader?
    Mr Kyei-Mensah-Bonsu 1:10 p.m.
    Mr Speaker, with respect, if he could show us which place he is referring to and where it is first used. [Pause.]
    Mr First Deputy Speaker 1:10 p.m.
    Yes, Hon Chairman of the Committee?
    Mr Avedzi 1:10 p.m.
    Mr Speaker, I think that the Hon Minority Leader wants to find out where the “investiment manager” was used in the Bill. [Interruption.] I cannot locate that immediately but I think it would fall under investment advisory committee, from page 15 of the principal enactment and on page 30.
    The “investment manager” was defined that is why I said from page 15, which is where we have the Investment Advisory Committee.
    Mr Avedzi 1:10 p.m.


    I cannot locate where it is used exactly but definitely, it would be used under the Investment Advisory Committee. We can locate it after we have finished then I would educate --
    Mr First Deputy Speaker 1:10 p.m.
    Hon Chairman, I think it would be advisable for us to place our finger on it before we take any risk. So we can defer this since we have deferred clause 4 for further consideration, we can defer this and then look it up.
    Mr Chireh 1:10 p.m.
    Mr Speaker, I do not see why we should defer this. He said that, if we look at paragraph (d) of the Bill, the (d) attempts to define “investment manager”. But if we look at the principal enactment which is Act 815 on page 30, immediately after the Investment Advisory Committee, we have:
    ‘“investment manager' means the Bank of Ghana or any person or entity appointed as investment or portfolio manager for purposes of this Act;”
    So it has been defined and he does not want to define it again.
    Mr First Deputy Speaker 1:10 p.m.
    Very well.
    I agree with you except that he could not place his finger on it and he said that we should make a presumption that it is there. But for the avoidance of doubt, we want to see the definition and move forward. So, I think once we have the definition there, the point he made is acceptable so I would put the Question --
    Mr Kyei-Mensah-Bonsu 1:10 p.m.
    Mr Speaker, with respect.
    The “investment manager” has been defined, right? Now, we want to see where it has been applied in the body of the Act before we call for its deletion. In the interpretation column, it is there and we have seen it, but I would want to know where in the Act does it appear before we call for its deletion.
    Mr Chireh 1:10 p.m.
    Mr Speaker --
    Mr First Deputy Speaker 1:10 p.m.
    Please, use the microphone.
    Mr Chireh 1:10 p.m.
    Mr Speaker, are we talking about the Bill or the Act? And if we are talking about the Act, then he should take a look at the section that deals with the Investment Advisory Committee. With that, he should look at the content. He said from page 15 onwards but -- It is there and that is why it is defined. [Interruption.]
    Is there any Investment Advisory Committee or not? I would look for it and call his attention to it.
    Mr Avedzi 1:10 p.m.
    Mr Speaker, if you read from section 26, that is page 14, “management obligations of the Bank of Ghana” it states that and with your permission, I beg to quote;
    1. “The Bank of Ghana is responsible for the day-to-day operational management of the Petroleum Holding Fund, the Ghana Petroleum Funds and subsequently the Ghana Petroleum Wealth Fund under the terms of the Operations Management Agreement.”
    2. “The Bank of Ghana shall manage the Ghana Petroleum Funds and subsequently the Ghana Petroleum Wealth Fund prudently within the framework of the operational and management strategy provided by the Minister, taking cognisance of:
    a) “investment guidelines used by the Bank of Ghana for investments of a similar nature;
    b) established and internationally recognised principles of good governance for the benefit of the Republic of Ghana; and
    c) “the need to support the national currency against destabilising factors in accordance with national monetary and foreign exchange policies.”
    So the Bank of Ghana is referred to here as the “investment manager”. It is not stated clearly as” investment manager” but the role obligation of the Bank of Ghana tells us that the Bank of Ghana is the “investment manager” and that is why they defined the “investment manager” as the Bank of Ghana on page 30.
    So if you read the definition, it says; and with your permission -- I quote:
    “investment manager” means the Bank of Ghana or any person or entity appointed as investment or portfolio manager for purposes of this Act.”
    So, I think that with this, we can proceed because it is not clearly stated but because of the obligations of the Bank of Ghana, it is the investment manager in this case.
    Mr Kyei-Mensah-Bonsu 1:10 p.m.
    Mr Speaker, if we delete that because it has not been used anywhere in the Act, so shall it be. But I just asked if the term has not been used, then we cannot go ahead to define it.
    So, I thought that the simple reason for proffering the amendments and calling for its deletion could be that, it has not been used anywhere in the Act.That is why when he moved it, I asked him exactly where it had been applied in the body of the Act. It does not appear anywhere, however, it found its way there, it is by conjecture. So, if we delete it, I am in favour of it, except that it has not been applied in the body of the Act and I do not see it.
    Mr Forson 1:10 p.m.
    Mr Speaker, in section 24, we plan to delete where we have to pay management fees for Bank of Ghana for the purposes of serving as investment manager.
    Mr Speaker, in section 24, it talks about transfer for exceptional purposes it ireads:
    1. “Where a transfer is made from the Petroleum Holding Fund for exceptional purposes, to refund tax overpayment and to pay management fees...”
    So, we were going to propose another amendment to delete “management fees” and that is why we felt we should accordingly delete the other one as well.
    Mr Chireh 1:10 p.m.
    Mr Speaker, if as he is said, from clauses 24 to 29, it is all about the investment and the role of the Bank of Ghana, particularly, in the case of management obligations of the Bank of Ghana at section 26. That is why the definition limited it to the Bank of Ghana but of course, from the Bank of Ghana, they could on their own, then designate another.
    So, basically, it is implied, it has been used and we should have it as we have said.
    Mr First Deputy Speaker 1:10 p.m.
    Very well.
    Question put and amendment agreed to.
    Mr First Deputy Speaker 1:10 p.m.
    Sorry, this is a deletion. Accordingly, paragraph (d) of clause 15 is negatived.
    But I would put the Question as amended --
    rose
    Mr First Deputy Speaker 1:20 a.m.
    Sorry. Hon Minority Leader?
    Mr Kyei-Mensah-Bonsu 1:20 a.m.
    Mr Speaker, the first one, really, was in respect of the amendment moved by the Hon Chairman, that is the Investment Manager. But this new one that the Hon Deputy Minister seeks to introduce , he says it does not find expression here but he just wants to sound us. Mr Speaker, are we going to have to pay people for rendering services in respect of management?
    If Bank of Ghana, for instance, sublets this to an investment company, are we going to have to pay them? If we have to pay them, where are we going to get the money from?
    That is why I do not understand why we are calling for its deletion that is because it does not tie to the Bank of Ghana. Look at clause 24 -- It does not tie it to the Bank of Ghana, so why did you say that it should be deleted. Management fees would certainly have to be paid. If he says that it is to Bank of Ghana -- We do not want it to go to Bank of Ghana, that is another matter but management fees would have to be paid.
    Unfortunately, clause 24, does not tie it to the Bank of Ghana. So, however it happens, the people who render the services would have to be paid. I do not see the reason why he is calling for its deletion.
    Mr Avedzi 1:20 a.m.
    Mr Speaker, I think that is a new issue all together. Yes, it is a new issue. What we are doing now by deleting the (d) -- [Interruption.]
    All right. So, let us move on. If that amendment comes tomorrow, then we can debate it.
    Mr First Deputy Speaker 1:20 a.m.
    Very well.
    Hon Members, I would put the Question with regard to clause 15 as amended to stand part of the Bill.
    Question put and amendment agreed to.
    Clause 15 as amended ordered to stand part of the Bill.
    Clause 16 -- First Schedule to Act 815 amended.
    Mr Avedzi 1:20 a.m.
    Mr Speaker, I beg to move clause 16, paragraph (c), delete and insert the following:
    “(4) expected revenue from gas shall be the product of the average actual and expected unit prices of domestic natural gas at which the national gas aggregator buys natural gas from the operator of the petroleum fields; and domestic gas quantity. The expected natural gas price shall be derived from seven-year moving average, the seven years being the four years immediately preceding the current financial year, the current financial year and the two years immediately following the current financial year. The expected natural gas quantity shall be derived as defined in (2)”.
    Mr Speaker, this is a better definition of the expected revenue that would come from the gas than what we have in the Bill. So, the Committee proposes this amendment to change the definition we have in the Bill.
    Mr First Deputy Speaker 1:20 a.m.
    Hon Member for Wa West?
    Mr Chireh 1:20 a.m.
    Mr Speaker, I do not have objections to the amendment but there are three full sentences in this amendment. In law-making, we need to either put a semicolon and continue, or break it down into one, two and three sentences.
    So, this is specifically for the draftspersons to tidy it up, not to be voted on.
    Prof. Gyan-Baffour 1:20 a.m.
    Mr Speaker, in addition to that, the language is so cumbersome and difficult to even understand. The product here means multiplying this by that. But when we read,we do not even know what the whole thing is about. I refer to the following, and
    Mr Speaker, I beg to quote 1:20 a.m.
    “… the product of the average actual and expected unit prices of domestic natural …”
    The product of “that and this”. So, why do we not say; “it shall be calculated by multiplying this by that”, so that everybody can understand what we are trying to say here.
    Mr Avedzi 1:20 a.m.
    Mr Speaker, come back to where? I am not -- [Interruption.]
    Prof. Gyan-Baffour 1:20 a.m.
    All right. Mr Speaker, I beg to move, clause 16, paragraph (c), delete and insert the following:
    “….expected revenue from gas shall be calculated by multiplying the average actual and expected unit prices of domestic natural gas at which the national gas aggregator buys natural gas from the operator of the petroleum fields by the domestic gas quantity.”
    “The expected natural gas price shall be derived from seven-year moving average, the seven years being the four years immediately preceding the current financial year, the current financial year and the two years immediately following the current financial year.”
    “The expected natural gas quantity shall be derived as defined in (2).”
    So, that it is it easier to understand.
    Mr First Deputy Speaker 1:20 a.m.
    Hon Chairman of the Committee, what do you say?
    Mr Avedzi 1:20 a.m.
    Mr Speaker, I object the proposal from my Hon Colleague.
    He is speaking the same thing but maybe he wants to use accounting language. This also makes sense:
    “The expected revenue from gas shall be the product of …”
    It is simple. Why does he want to change it? Why does he want to say:
    “shall be calculated by multiplying
    . . .”
    No. Please, let us maintain this one. We can go his way that the draftspersons to re-arrange it properly so that the meaning would not change.
    Mr First Deputy Speaker 1:20 a.m.
    Yes, Hon Member for Wa West?
    Mr Chireh 1:20 a.m.
    Mr Speaker, I think my Hon Friend is now adding to the complication by adding multiplication. My multiplication is off. Unless he does not know --
    Mr First Deputy Speaker 1:20 a.m.
    Hon Members, I believe that after taking the vote we would direct that the draftspersons do the cleaning up --
    Mr Chireh 1:20 a.m.
    There is no need for the amendment.
    Mr Kyei-Mensah-Bonsu 1:20 a.m.
    Mr Speaker, if you go into the original Act and you look at Benchmark Revenue from Petroleum Operations, (1) provides that and I beg to quote:
    “for purposes of this Section, the annual benchmark revenues from Petroleum operations [and Petroleum includes both crude and gas, right?] shall be calculated on the basis of the actual and expected average unit price for crude oil and natural gas, derived from a seven- year moving average, the seven years being the four years immediately prior to the current financial year, the current financial year itself and the two years immediately following the current financial year.”
    rose
    Mr Kyei-Mensah-Bonsu 1:30 p.m.
    I have not finished but if you want to come in, I would yield to you. Maybe, you have something to say.
    Mr Avedzi 1:30 p.m.
    Mr Speaker, I think that at the Committee level, we also had the same argument that if the definition for the expected revenue from petroleum is couched in a particular way, why do we not couch the same for the gas? The explanation we had was that the operation for petroleum is completely different from the gas. [Interruption.]
    Yes, let me explain myself. They would take the crude from the ground and it is lifted and it is sold. The formula is the seven-year moving average -- Four years preceding current year and two years immediately after the current year. That would make up the seven.
    The same goes for the gas, but in the case of the gas, the gas is taken, processed and sold here in Ghana to Ghana National Petroleum Corporation (GNPC). GNPC would then sell the gas to Volta River Authority (VRA).
    There is an element of profit making along the line. That is where the issue of aggregation comes in. This is the technical definition which was given to us. But because of this processes involved, in the case of the gas, it cannot have the same definition as we did in the case of the petroleum.
    So, I agree with him that if one looks at the petroleum, he would think that the gas should also follow the same process. But here, it is quite different from the petroleum and that is why they gave this definition for the gas.
    Mr Kyei-Mensah-Bonsu 1:30 p.m.
    Mr Speaker, what I would want the Hon Chairman to respond to is -- The two things are completely different. In the Act, they talk about the calculation of royalties and not revenue. Now, he seeks to replace it with the calculation of revenue. Where is the place for the calculation of royalties then?
    In the Act, it is the royalties. Now, he seeks to delete that and replace with this. Where is the place of the royalties?
    Mr First Deputy Speaker 1:30 p.m.
    Yes, could we get the response?
    Mr Forson 1:30 p.m.
    Mr Speaker, unlike petroleum, in the case of gas, different gas fields have different prices. It is the average gas price that we are referring to under this new enactment.
    Mr Speaker, Jubilee Field's price is different from that of Tema Oil Refinery (TOR) and it is different from Sankofa Gas Field and so we are looking at the average.
    Mr Kyei-Mensah-Bonsu 1:30 p.m.
    What I am saying is, the clause 4 of the Act which he seeks to delete deals with expected royalties with gas. And he has introduced this new clause 4, which deals with revenue from the gas.
    That is why I am asking, is there royalties to be paid in respect of gas production? This is because that is what the clause 4 applies to. It is not the revenue. That is why I am asking and so, where is the place for royalties on gas production?
    Mr Forson 1:30 p.m.
    Mr Speaker, in this case, the royalties are embedded in the benchmark revenue.
    Mr First Deputy Speaker 1:30 p.m.
    Do you not think that, for the avoidance of doubt, we could specifically make provisions for
    that? I understand it is embedded in it, but if it is possible to make specific reference to royalties -- Could we defer this so that we deal with it in that manner?
    Mr Forson 1:30 p.m.
    All right, Mr Speaker.
    Mr First Deputy Speaker 1:30 p.m.
    Very well. Thank you very much.
    Hon Members, this brings us to the end of the Consideration Stage for today.
    Yes, Hon Deputy Majority Leader?
    Mr Agbesi 1:30 p.m.
    Mr Speaker, the Minerals and Mining (Amendment) Bill, 2014, which is at the Consideration Stage is still being worked on by the Committee.
    Mr Speaker, in the circumstance, I would want to beg to move, that the House adjourns now till tomorrow at 10.00 a.m.
    Mr First Deputy Speaker 1:30 p.m.
    Any seconder?
    Mr Kyei-Mensah-Bonsu 1:30 p.m.
    Mr Speaker, I might even want to implore you, given the paucity of the numbers. If you should ask for a determination on this, we might not even have the number to respond.
    So, I guess, in this case, we may adjourn. This is because, if you should ask for a response to this, we do not have the quorate number to determine whether to close or not.
    Mr Speaker, in the circumstance, I feel constrained to second this Motion.
    Mr First Deputy Speaker 1:30 p.m.
    Are you therefore, suggesting that we remain here ad infinitum?
    Mr Kyei-Mensah-Bonsu 1:30 p.m.
    No! Mr
    Speaker, where we cannot raise a quorum, you reserve the right to adjourn.
    Mr First Deputy Speaker 1:30 p.m.
    I take it that you are seconding the Motion.
    Mr Osei Kyei-Mensah-Bonso 1:30 p.m.
    Mr Speaker, if you so desire, I beg to second the Motion.
    Question put and Motion agreed to.
    ADJOURNMENT 1:30 p.m.
  • The House was accordingly adjourned at 1.00 p.m. till Thursday, 25th June, 2015 at 10.00 a.m.