Pass Mineral Revenue Management Act to fund Free SHS – ACEP

The Africa Centre for Energy Policy (ACEP) has recommended that the government pass the promised Mineral Revenue Management Act to create additional sources of funds from solid minerals to finance the free Senior High School policy...


The Africa Centre for Energy Policy (ACEP) has recommended that the government pass the promised Mineral Revenue Management Act to create additional sources of funds from solid minerals to finance the free Senior High School policy.

According to ACEP, additional funding streams will augment bankrolling of the policy with funds from the Annual Budget funding Amount (ABFA).

In its analysis of the 2018 budget presented to parliament by Finance Minister Ken Ofori-Atta recently, ACEP said the ABFA will again contribute about 40% of the total of GH₵1,137,861,816 to the Free SHS policy in 2018.

This amount, which is a little over twice the budgeted ABFA support to Free SHS policy in 2017, also constitutes 98.28% of total ABFA to goods and services. The increment, according to ACEP, could be explained by the expected increase in the number of beneficiaries of the programme.

“It has been observed that as of September, 2017 actual ABFA disbursement to support the free SHS Policy constituted 84.3% of the total funds of GH₵240 million released by the government. While it is important to recognise ABFA support to the free SHS policy for 2018 and beyond, it is equally important to stress on the need to clearly identify reliable sources of funding to complement the ABFA.

“There is also the need to expand infrastructure to accommodate the increasing number of students in Senior High Schools, which is the direct result of the Free SHS policy,” ACEP advised.

“We observe, however, that without donor funds, the Government of Ghana’s investment plans in education sector infrastructure for the 2018 financial year is negligible compared to other spending areas of the sector.

“Of the GH₵8.9 billion allocated to the Ministry of Education from the GoG, ABFA and IGF, wages and salaries constitute a whopping 82% while the rest goes to goods and services (14%) and infrastructure (4%). In 2018, much of the capital budget for the education sector will be financed by IGF and Donors. Particularly for the secondary school level where everything is now free, there will be greater dependence on Development Partners for infrastructure financing.
“It is, however, observed that donor funding for the Ministry of Education will decline for the medium-term expenditure framework. Before the free SHS policy, ABFA allocation to the education sector was largely focused on capital expenditure. There is now the need to replace capital expenditure allocation by identifying new sources of funds for that purpose,” ACEP added.

Apart from ACEP’s recommendation that the Mineral Revenue Management Act be passed to help amass additional funding, it also said: “In light of the risk of petroleum price volatility and its effects on the ABFA, the government should pay attention to investment attraction in the upstream sector to spread revenue generation risks from the three oil fields currently operational. ACEP insists that existing non-performing petroleum agreements should immediately be reviewed and, where necessary, be re-awarded to companies that possess the requisite capacities to meet contractual obligations. These will ensure speedy off-shore activities to increase the likelihood of revenue generation from upstream oil and gas sector, and thus increase ABFA allocations to the free SHS policy.”

“The Government of Ghana should also consider amending the GETFund Act to re-focus investments, both infrastructure and recurrent, on both basic and secondary levels of education. The National Education Fund-Raising Committee of the GETFund Board should be constituted, if not existent, and strengthened to generate funds through grants, donations, gifts and other voluntary contributions in accordance with section 3(d) of Act 581 to support the free SHS policy. Also, the government should sensitise the public about the existence of opportunity to voluntarily contribute to the GETFund to finance the free SHS policy,” it added.


Source: Ghana/ClassFMonline.com/91.3FM



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