The Public Interest and Accountability Committee (PIAC) is calling for a long-term national development plan to guide how the country allocates its oil revenue.
Currently, the Petroleum Revenue Management Act (PRMA) allows the government to choose just four out of twelve designated “Priority Areas” every three years for funding through the Annual Budget Funding Amount (ABFA). PIAC argues this approach lacks strategic direction and hampers effective use of oil revenue.
Their 2023 Annual Report proposes that selecting priority areas should be based on a long-term development plan approved by Parliament.
This, they believe, would ensure a more strategic and impactful use of Ghana’s oil wealth.
Key Points from the Report:
- Ghana received $1.1 billion in oil revenue in 2023, distributed among key institutions.
- ABFA, a key source for government spending, contributed significantly to the Agenda 111 project (65.24%).
- However, funding for Industrialisation, a designated priority area, has declined significantly (from 1.15% in 2020 to 0.11% in 2023). PIAC sees this as a worrying trend.
- There were positive developments: 5% of ABFA was allocated to the District Assemblies Common Fund (DACF), complying with a court ruling.
PIAC’s Recommendations:
- Develop a long-term national development plan to guide oil revenue allocation.
- Ensure ABFA allocations for Industrialisation reflect its designated priority status.
- Guarantee future DACF allocations meet the minimum 5% requirement.
- Ensure DACF utilizes ABFA funds according to the PRMA’s provisions, prioritizing development projects over operational costs.
By implementing these recommendations, PIAC hopes to see Ghana’s oil revenue used more strategically for long-term national development.
