Mr Speaker, in recent
years, the Ghanaian political space
has experienced upheavals in the
socio economic space leading to a
questioning of one of the core
mandates of the State - the ability
to secure its obligation as the
protector of the public good and
particularly in the developing
country setting, as the elixir for
socio economic development and
transformation.
The State's obligation to protect the public good finds expression in an agency arrangement with the citizenry through the inter- mediation of Regulatory bodies and Institutions. These institutions thus become the proxy embody- ment of the State. Any deviation
and or under performance by
Regulatory bodies therefore,
constitutes State failure and must
be of great concern to the sovereign
people and their elected
Representatives.
The current near free reign of
illegal mining, the wanton abuse of
the petroleum downstream sector,
the near meltdown of the financial
sector, the ever pervasive boat
accidents on the Volta Lake, the
chaotic land administration scene,
the near depletion of our forests,
the pollution of water bodies, the
total disregard for building
regulations and spatial planning
rules, the population of the market
place with substandard goods, to
mention but a few, are
symptomatic of regulatory and
enforcement failure.
And yet our statute book is
replete with Regulatory bodies
established by both the
Constitution and various Acts of
Parliament. The Land Com-
mission, the Minerals Commission,
the Petroleum Commission, the
Forestry Commission, the Securities and Exchange Commission, the
Water Commission, the Town and
Country Department, the Ghana
Maritime Authority, the Fisheries
Commission, the Insurance
Commission, the Bank of Ghana,
the National Petroleum Authority,
the State Enterprises Commission,
the Ghana Standards Authority, the
Environmental Protection Agency,
the Energy Commission, the Public
Utilities Regulatory Commission,
Medical and Dental Council,
Institute of Chartered Accountants,
the Food and Drugs Board et cetera
are some of the key regulatory
agencies established.
Regulatory bodies, unlike other
agencies of Government, impose
duties. They deliver obligations,
rather than services. They are
society's arms regulatory and enforcement agencies with vast
powers. They can impose
economic sanctions, place liens
upon or seize property, limit
business practices, suspend
professional licenses etc. They are
given such awesome power
because they protect the public
interest. The protection of public
interest ensures that society is safe
from abuse. How regulatory
agencies use these powers
fundamentally affect the nature and
quality of life in a democracy.
Mr Speaker, it is therefore not
surprising that in most democratic
jurisdictions, Regulators (and or
regulatory bodies) are scrutinised
more often and more closely than
other agencies of government. The
possibility of the abuse of power,
the dereliction of duty and the
jeopardizing of the lives of the
citizenry, whether in the area of
public health, the financial market
or public safety impacts directly on
the welfare and wellbeing of the
citizenry and such institutions and
agencies must therefore be held
accountable for their stewardship
of public resources and trust.
Rt Hon Speaker, a cursory look
at the stewardship of a few of these
regulatory bodies paints a very
worrying picture. I would want to
zero in on the National Petroleum
Authority, the Minerals Commission and the Ghana Standards Authority
to argue that there has been
regulatory failure in Ghana and that
this House must take a far more
serious interest in regulatory bodies
and regulatory practice than it has
done in the past.
Minerals Commission
The Minerals Commission is
established by article 269 of the
1992 Constitution and the Minerals
Commission Act 1993 (Act 450).
Act 450 Sect 2 (1) states that:
“The Commission is res- ponsible for the regulation
and management of the
utilization of mineral resources and the coordination of the
policies in relation to
them”.
Section 2 (2c) further tasks the
Commission to 'monitor the
implementation of laid down
policies of the Government on
minerals and report on this to the
Minister'.
Section 2 (2d) further enjoins
the Commission to monitor the
operations of the bodies or
establishments with responsibility
for minerals and report to the
Minister.
There is no doubt that the Law
envisages a robust regulatory body
with full responsibility for the
minerals sector. The Mining and
Minerals Act, 2006 (Act 703) puts
more flesh on the regulatory role of
the Commission by restricting the
Minister from exercising any
power, discretion, or making a
determination or agreement
without obtaining the advice and
recommendation of the Minerals
Commission.
Act 450 Section 7(2) mandates
the Minister to submit to
Parliament an Annual report
received from the Commission.
The law envisages that within a
maximum of eight months of the
expiry of each financial year, the
Annual Report and any Statement
the Minister responsible for the
Sector may deem necessary should
be placed before Parliament.
Mr Speaker, we are all living
witnesses to the mess the artisanal
and small scale mining (ASM) has
become in recent years. Within the
last three years or so, two high
profile attempts at considerable
cost to the tax payer have been
made to clean up the growing
illegal mining regime in almost
every Region of Ghana with
disastrous consequences. Most of
our rivers and streams are
dangerously polluted by unsafe
chemicals particularly mercury
used in mining operations. The
Minerals Commission, ably aided
by the Forestry Commission has
become a good case study of
exactly how not to regulate.
The menace started as small
scale low technology mining with
the Minerals Commission gleefully
looking on without providing the
needed guidance and technological
leadership to go with the paradigm
change. The failure in regulatory
leadership by the Minerals
Commission has allowed the ASM
to be hugely invaded by Chinese
and other nationalities imposing
significant damage to our
environment especially water
bodies, soil and atmospheric
pollution.
National Petroleum Authority
The National Petroleum
Authority (NPA) is established by
Act 691 (2005) as the downstream
petroleum industry Regulator.
The Act sets out the object of
the Authority to regulate, oversee
and monitor activities in the
petroleum downstream industry
and where applicable, do so in the
pursuance of the prescribed
petroleum pricing formula. The Act
also puts an obligation on the
Authority to (2:2h,i,j) to investigate
on a regular basis, the operation of
petroleum service providers to
ensure conformity to the best
practice and protocols in the
petroleum downstream industry, to
promote fair competition amongst
petroleum service providers and to
conduct studies relating to the
economy, efficiency and
effectiveness of the downstream
industry.
Mr Speaker, the NPA has
tremendous powers invested in it
by the law passed by this House
over which you ably preside. The
conduct however of the NPA has
not just left much to be desired, but
is threatening the health and
survival of the downstream
industry, while impairing both the
physical and financial health of the
people and economy.
Mr Speaker, the NPA has
carelessly registered two hundred
and twenty-five (225) Oil and Gas
Marketing Companies as at the end
of April, 2021. As at 30th April,
2021, only 95 of these have lifted
either a litre or a kilogram of fuel.
And yet the NPA has gleefully
allowed multiple registration and
sponsorship of more than one
company by the same entity while
superintending over wholesale
'Third Party' deliveries contrary to
the norms and best practice of the
industry.
Mr Speaker, as at 09/03/21, the
OMCs were indebted to the Ghana
Revenue Authority to the tune of
GH¢641,017,056.22 in overdue
and outstanding collections they
made on behalf of GRA and
refused to remit according to the
laid down process. Through
multiple registration and licensing
allowed by NPA, the OMCs
manipulate their deliveries to short
change the Ghana Revenue
Authority once NPA gets its license
fee and annual renewal fees.
Mr Speaker, the abuse of the
UPPF administered by NPA is a
standing joke in the industry.
Notwithstanding the plethora of
schemes introduced by the NPA to
check diversion and adulteration of
petroleum products (and in the
process abusing the UPPF), NPA
has either by its collusion or
lethargy, added unwarranted cost to
petroleum prices and unnecessarily
heated up the economy.
Instruments such as the Enterprise
Data Resource Management
System (EDRMS), Electronic
Seals, Electronic Probes (and
GPS), BRV tracking, Product
Marking, Fuel Station pump and
tank probes have all been
introduced to curb one ailment at a
huge direct cost to consumers with
very little impact on illegal
practices.
Mr Speaker, a cursory glance at
the April, 2021 OMC Performance
Statistics would show that OMCs
with very negligible physical
presence on the grounds are lifting
huge volumes of products either
with the connivance or negligence
of the NPA. The incentive to do
good professional business in the
sector is being eroded by the level
of abuse in the downstream sector.
Ghana Standards Authority
The Ghana Standards Authority
draws its existence from NRCD
173 of 1973. The decree provides
for the Authority whose objects
include (2a) establishing and
promulgating standards with the
aim of ensuring high quality goods
produced in Ghana. Section 2(b)
tasks the Authority to promote
standardisation in industry and
commerce while 2(c&d) enjoining
the Authority to promote industrial
efficiency and development as well
as public safety, industrial welfare,
health and safety in the industrial
space.
The Authority is thus clothed
with powers to ensure high
industrial Standards in Ghana.
Indeed, standards do not only apply
to goods but services. In a survey
conducted on some electrical good
in Accra by a Task Force led by the
Ghana Standards Authority, on 7.4
per cent of the electrical goods met
the required specification. Standards are noted more by their non-
observance than their observance.
Imported electrical goods such as
sockets and plugs fall within the
very high non observance category.
Mr Speaker, the least said
about the services sector, the better.
Very few, if any MMDA has met
the ISO 9000 (Quality Manage-
ment), ISO 14000 (Environmental
Management) or ISO 27000
(Information Security Manage-
ment) standard. The result of
nonobservance of standards, part- icularly in the power retail sector, has led to a number of fire
outbreaks with the attendant loss of
lives and property. Mr Speaker,
may I dare suggest that the
enabling law is obsolete and must
be replaced. It is unwise for a
critical Regulator to draw its
powers from a Decree passed in
1973!
Ghana Maritime Authority
The Ghana Maritime Authority,
established by the Ghana Maritime
Authority Act, 2002 (Act 630) is
charged to 'regulate, monitor and
coordinate activities in the
maritime industry' (Sect 2.1).
Section 2(2c) expands this further
by adding the responsibility to
regulate activities on shipping in
the inland waterways including the
safety of navigation in inland
waterways. It is also to oversee
matters pertaining to training,
recruitment and welfare of
Ghanaian seafarers.
Section 24 (2) obliges the
Minister to submit to Parliament an
Annual Report on the activities of
the Authority. This should happen
within a maximum of eight months
after the end of the financial year.
The failure of the Ghana
Maritime Authority to play its
regulatory role especially on the
Volta Lake results in the loss of
lives and goods every year and a
very rudimentary transport system.
The irony is that water transport is
meant to be the cheapest and most
reliable means of transporting bulk
cargo. The savings arising from
cheaper freight, coupled with the
ability to take load off from the
trunk roads at considerably lower
freight would also make our roads
last longer and reduce accidents on
the roads.
Unfortunately the Authority is
yet to aver itself to this major
developmental function. Mr
Speaker, the need to develop an
inland water transport system and
to regulate it cannot wait. This
House through its oversight role,
must compel the GMA to be up and
doing.
Mr Speaker, in any system,
compliance is the way to maintain
order and sanity for the going
concern or society. In as much as
the Regulator expects compliance
from its applicants, the Regulator
itself is also equally expected to
comply with its own regulations
such as: 'A person shall not engage
in downstream industry unless that
person has been granted a license
for the purpose,' (section 11 of Act
691).
If a person so initiates an
engagement in downstream
industry illegally, it is the duty of
the Regulator to act under the
guidance of the Act. Similarly,
section 9 of the Minerals and
Mining Act, ACT 703 prohibits
persons from mining for a mineral
unless the person has been granted
a mineral right in accordance with
the Act.
Compliance and enforcement,
Mr Speaker, must not only be
desired, but must be asked for. In
seeking compliance, Regulatory
bodies must themselves comply
with the dictates of their enabling
statutes. The vast number of these
bodies do not for example submit
time frame provided, their Annual
Reports to Parliament.
Mr Speaker, I dare say that
Parliament has also not vigorously
exercised it oversight over these
regulatory bodies. A number of
them hardly submit the required
Annual report and when they do, it
is done years late to be of real
benefit to Parliament and the
Nation.
Mr Speaker regulatory practice
is a craft with well-defined goals.
The choice and application of
regulatory tools must be carefully
considered to achieve desired goals
and minimise, if not eliminate,
undesired consequences. The Bank
of Ghana as a regulator has either
by accident or design created a
climate that has diminished the
presence of indigenous banks and
promoted the prominence of
foreign owned banks at a time the
Ghanaian State is committing itself
to the promotion of local content
and ownership in the economic
space.
Regulatory regimes, by their
conduct, can take perfectly
reasonable law and produce
oppressive regimes. Similarly, by
choosing wisely what to enforce,
when, and how, Regulators can
take an unmanageable accumu-
lation of laws, many of which
might be obsolete, and deliver
perfectly reasonable regulatory
protection.
Neal Shower et al in their study
of strip mining, observed "Now law
is writ, and laws are rules. They are
paper threats. They represent the
State's intent to regulate certain
forms of behavior. But laws on the
books mean little in and of
themselves. They are meaningful
only in so far as they are backed by
the mobilization of state powers,
law in action.”
Mr Speaker may I conclude by
calling on this House to take a
second look at how we exercise
oversight over regulatory bodies
and agencies. May we bring the
appropriate Ministers to answer for
the non-submission or late
submission of annual or bi-annual
reports as the case may be.
And may I humbly suggest that
the House develops a mechanism
for examining these reports other
than the traditional referral to
Committees or where the referral
must of necessity be made to a
subject matter Committee, the
Committee report must be given
prominence of place at the plenary.
In my opinion, half of the
challenges of governance in this
country arise out of regulatory and
enforcement failure.
We as Members of this House
are obliged by our Oath of Office to
address this worrying clear and
present danger to the very
foundations of governance.
Thank you Mr Speaker for
admitting this Statement.
