A member of the National Democratic Congress (NDC) Communications Team in the Upper East Region, Dr. Nicholas Zangina, has indicated that the tariff adjustments announced by the Public Utilities Regulatory Commission (PURC) stem from prior commitments made by the government under the International Monetary Fund (IMF) program.
His comments follow strong opposition from the Ghana Union of Traders Association (GUTA), which has criticized the planned tariff hikes. Dr. Zangina noted that the tariff review mechanism was not initiated by the current administration but is part of broader structural reforms tied to the country’s agreement with the IMF.
He explained that during the third-quarter review of the IMF program, Ghana’s former finance minister and the former governor of the Bank of Ghana jointly authored a letter of intent requesting a $300 million disbursement under the extended credit facility. In that letter, the government committed to specific revenue-enhancing measures aimed at improving efficiency in the energy sector.
Among these commitments was the adoption of an automatic tariff adjustment formula that would allow quarterly reviews of utility tariffs. The adjustments are tied to fluctuations in key economic indicators such as inflation and exchange rate performance. This mechanism is designed to ensure that the energy sector remains financially sustainable while reducing operational inefficiencies.
“As part of the conditions for us to access the extended credit facility from the IMF, the government said that if you were to give us this support, these are the revenue measures that we are going to implement to ensure that the energy sector brings in the needed revenues to cut down operating inefficiencies. What it means is that, quarterly, PURC will adjust tariffs upwards or downwards, depending on exchange rate movement or inflation trends in the country,” he explained.
Speaking during an interview on A1 Radio, Dr. Zangina emphasized that the tariff increases are not a result of mismanagement or political decisions, but rather a necessary step outlined in the country’s IMF obligations. He acknowledged the financial burden these increases place on Ghanaians, noting that all citizens, regardless of political affiliation, are equally affected by rising utility costs.
“It is not out of bad faith that we are going to see an adjustment. And I have always said that we can do politics with some of these things, but the point is that I, seated here as an NDC member communicating for the NDC, buy electricity and pay water bills. So, if it goes up, it is to my disadvantage. If it comes down, it is to my advantage.”
He drew parallels to previous fiscal measures, such as the debt restructuring or “haircut” imposed on investors during earlier phases of the IMF agreement, underscoring the difficult trade-offs required to stabilize the economy.
“It is just like the haircut that we gave to some investors when we were entering into the extended credit facility agreement,” he noted.
While recognizing the frustration of consumers and businesses, Dr. Zangina urged the public to understand the broader economic context and endure the short-term hardships as the country navigates its path to financial recovery.
“The point is that, yes, we share in the pains and the hardships of every Ghanaian,” he said. “But in the meantime, we will have to bear with it.”
Source: A1Radioonline.com | 101.1MHz | Gifty Eyram Kudiabor | Bolgatanga
