Oquaye raises red flag over use of oil money

By: Daniel Nonor

Dr. Oteng Adjei, Energy Minister

The Second Deputy Speaker of Parliament and Member of Parliament (MP) for Dome-Kwabenya, Professor Mike Oquaye, is agitated by attempts by members of the Majority side of the House, to use their number muscles to amend key clauses in the Petroleum Revenue Management Bill.

Key among them is the attempt to scrap the Public Interest and Accountability Committee (PIAC), which would be entrusted with the duty of enhancing public accountability in the management of petroleum.

The PIAC is required to monitor and evaluate compliance by government and other relevant institutions in the discharge of their duties, in relation to the use and management of petroleum revenue resources, as required by law.

The argument in support of its elimination, as contained in the report of The Joint Committee of Finance and Mines and Energy on the petroleum revenue management bill, is that Parliament and the Auditor General are the constitutionally-mandated oversight bodies of public funds, and therefore, the existence of the PIAC would be a be a duplication of efforts, the Majority contend.

This school of thought has been fiercely contested by the Second Deputy Speaker, who holds the view that establishing the PIAC would not be a competition from Parliament, but would rather complement Parliament.

According to him the paternalistic approach to politics in Africa where the government manage and appropriate resources  of state on behalf of citizens as if they were children must cease.”The public are not children,” he reiterated.

According to the Second Deputy Speaker, when the public was actively involved in the management of oil resources and privy to how the money accrued was used, the nation would be able to limit the false expectations created about the oil find.

He said already, there was a growing distrust of politicians in the country, and that it was about time political leaders redeemed that image by enhancing enough public participation in governance and the management of resources.

He therefore, called on civil society to rise up to the challenge, should that clause be amended.

The Member of Parliament was speaking in an exclusive interview with The Chronicle in relation to submissions he made earlier on the floor of Parliament on the Petroleum Management Bill.

He was also of the opinion that considering the peculiarity of oil, a separate fund should be maintained for revenue accrued from it, which should be separate from the Consolidated Fund.

He recalled that the current Minister of Finance, in a memorandum to Parliament in July 2010, was emphatic that considering the peculiar nature of oil, the PRMB should provide “clear oversight mechanism, transparency, auditing, accounting and reporting mechanisms to safeguard the management of petroleum revenues,” and therefore, could not fathom when the government went to bed and had “some bad sleep, and now wants to change it.”

The Clause Five of the Oil Revenue Management Bill, which has been the subject of controversy and sharply divided the Legislative House, is also up for amendment. This clause Bill prohibits the use of petroleum resources as securities for borrowing by the government, public agencies and any private entity.

The Minority side  of the house has constantly accused the Majority of clandestine attempts to amend this clause to enable them secure the numerous loan facilities they had initiated, a thing the Majority has vehemently refuted.

According to him, borrowing excessively, using oil as collateral amounted to hedging. He therefore, advocated that borrowing against oil should not be more than five years, considering the volatility of oil prices on the world market.

The Finance Minister’s memo to Parliament states categorically: “Many oil-exporting countries have also frequently ended up in debt, because they tend to borrow more than 100 per cent of their increased revenues. While it makes good sense to raise public investment spending by borrowing against future oil earnings, it is the uncertainties of oil incomes that often make such borrowing treacherous. Taking a cue from what the Minister has said, it is not proper to borrow against oil for more than five years,” he suggested.

Demands by western chiefs

According to Prof. Mike Oquaye, a special development fund was needed to be set up for the people of the Western Region, to help facilitate the development of the region.

He argued that oil had environmental hazards, which would not apply to the rest of the country, and that everywhere oil was found, whether by land or by sea, there would be certain adverse environmental hazards, which would be peculiar to that place and affecting the people within the immediate proximity of the oil exploration area.

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