The Ministry of Finance has released about GH¢1.2 billion as part payment for COVID-19 relief covering the free electricity and water supplied to Ghanaians to help them comply with the safety protocols.
The free electricity and water are part of the many social interventions rolled out by government to cushion Ghanaians against the hardships imposed by COVID-19, such as the loss of income.
To ensure that many Ghanaians do not suffer disconnection because of their inability to settle their electricity bills in the midst of the pandemic, ECG has received at least GH¢1 billion as part payment for the free power it supplied to the public.
The Ghana Water Company Limited (GWCL), on the other hand, has received about GH¢180 million for providing free water to the general public since the outbreak of COVID-19 in the region.
Sources at the Ministry of Finance said the Minister-designate for Finance, Mr Ken Ofori-Atta, had budgeted GH¢1.8 billion for the provision of free electricity and water.
Deviation of GH¢632 million
This means that the Ministry of Finance has to find a balance of more than GH¢632 million if the budgeted amount tallies with the final invoices to be raised by the two utility service providers.
However, in the event that the final bill from the two utility companies exceeds the over GH¢1.8 billion budget, the government would have to look for the additional money to pay.
Massive decline in government revenue
Government is making all the expenditure in spite of a massive drop in revenues, including a significant decline of $1.6 billion in crude oil export receipts on the back of low prices.
As a result of the impact of COVID-19, the GH¢47.2 billion (GH¢47,253.95 million) the Ghana Revenue Authority (GRA) was tasked to collect was revised to GH¢42.7 billion (GH¢42,769.50 million) in the mid-year budget review.
At the end of the year, GRA, with the support of Mr Ofori-Atta, implemented initiatives that resulted in the collection of GH¢45.3 billion (GH¢45,338.69 million), indicating that the original target was missed by over GH¢1.9 billion (GH¢1,915.26 million).
Despite the sharp decline in revenues, Mr Ofori-Atta continues to find the resources to help the country battle the pandemic.
Free electricity — April, May, June 2020
When the pandemic hit, President Nana Addo Dankwa Akufo-Addo, in a compassionate move during the lockdown, absorbed the bills of low-income consumers of electricity in the country for April, May and June 2020.
The remaining consumers, who fall outside of this category, enjoyed 50 per cent reduction in the cost of electricity for the same period.
The President disclosed that in his sixth national address to the nation on the novel coronavirus on Thursday, April 9, 2020.
Free water — April, May, June 2020
Government also absorbed the water bills for all Ghanaians for April, May and June 2020 following an increase in the country’s coronavirus cases amidst a partial lockdown of the epicentres of the disease.
Free water, electricity extended
When he presented the 2020 Mid-Year Budget to Parliament, then Finance Minister, Mr Ofori-Atta announced the extension of free water and electricity supplies to consumers.
The period for free water, which ended in May 2020, was extended for additional three months, while free electricity was extended for six months.
“It takes a caring government of the people, and with that, I mean, a government of all the people, to offer cost-free water to all across the country: representing all domestic and commercial customers in Ghana for three months.
“It takes a caring government to be for the people and for businesses, large and small, to choose to subsidise electricity consumption by 50 per cent to 4,086,286 households and 686,522 businesses at a cost of GH¢1.02 billion in three months”, Mr Ofori-Atta told parliamentarians.
Free water extended to December 2020
On September 23, 2020, President Nana Addo Dankwa Akufo-Addo extended the free water package in the wake of the coronavirus disease (COVID-19) to the end of the year.
Free water, electricity for lifeline consumers from Jan-March 2021
On Sunday, January 3, 2021, President Addo Dankwa Akufo-Addo, in his 21st COVID-19 update to the nation, extended free provision of water and electricity for lifeline customers by three more months.