LET"S HAVE A BREAKTHROUGH (JULY 31, 2010)

EVER since the Public Utilities and Regulatory Commission (PURC) announced upward adjustments in tariffs of 89 per cent and 36 per cent for electricity and water, respectively, there has been public outcry. Industry players, including the Association of Ghana Industries (AGI) and organised labour, have been unanimous in calling for a downward review or the total suspension of the new tariffs.
They argued, among other things, that if the tariffs were not reviewed, it would compel some industries such as the textile, plastic, steel and cement industries to fold up, resulting in layoffs.
In addition, they said industries were already battling with the high cost of doing business in Ghana in respect of high interest rates, the multiplicity of taxes and the level of taxation and indicated that the increases would exacerbate the situation, rendering industries in Ghana less competitive.
The Ghana Timber Millers Organisation (GTMO) later joined the chorus, threatening to send home some 50,000 employees by the end of the year as a result of the upward adjustment in the utility tariffs.
It said it was not possible for the industry, the nation’s fourth foreign exchange earner, with receipts averaging 180 million Euros annually, to survive the upward adjustment in tariffs.
Then, on Thursday, the Industrial and Commercial Workers Union (ICU) also staged a nation-wide demonstration to demand a reduction in the tariffs.
In its petition to the government, the ICU noted with great concern the adverse effects that the astronomical increases in tariffs announced by the PURC would have on industry and commerce, adding that the purported increases were misleading and that the real increases ranged from 198 per cent to 235 per cent.
At the time the ICU members were on the streets, the Vice-President, Mr John Dramani Mahama, was in a high-level meeting with the leadership of organised labour and industry over the tariffs, with the view to finding a common ground to deal with the problem.
The DAILY GRAPHIC is happy that at the end of the day, it was agreed that a technical committee be put in place to debate how much adjustment in the tariffs would be reasonable.
The proposals considered at the meeting included the provision of subsidies by asking the PURC to reduce the tariffs, a re-look at the criteria for calculating the tariffs and periodic increases in place of the one-time increment.
Even though the government maintained that due to the independence of the PURC the commission could not be forced to implement those proposals, it gave the assurance that there was room for negotiations to consider the options.
Certainly nothing is conclusive yet, but the DAILY GRAPHIC is delighted at the openness that has characterised the deliberations so far. We are hopeful that if things continue in this healthy manner, there will be a significant breakthrough in the not-too-distant future.
Our national development is basically dependent on the performance of our private sector, considered the engine of growth. Indeed, the private sector remains the fulcrum of our national economy and growth and, therefore, the concerns of the sector should be considered in determining policy interventions.
Let us break the deadlock.