A labour expert, Mohammed Affum, has criticised government for its handling of the agreement that will see management of the Electricity Company of Ghana (ECG) in the hands of a private firm.
The ECG is to be leased to a private company in accordance with the Millennium Challenge Account the government of Ghana signed with its US counterpart, which will see the management of the entity change hands for 30 years.
There had been talks that the company was being privatised but President Mahama, at the May Day 2016 event at Wa in the Upper West Region, assured: “Let me restate that ECG is and will remain a wholly owned state enterprise,” adding: “Government has no intention of privatising ECG.”
But according to Mr Affum, the government had not been transparent in its dealings regarding the management of the nation’s leading power distributor. He argues that privatisation occur in many forms and government must explain the details of the contract to citizens.
Speaking with Accra News on May 1, 2016, he said: “If he [President Mahama] says that, then he has not explained matters well. Privatisation can take many forms.
“Privatisation may involve outright sale to a foreign company. Another is leaving the management of the company in the hands of a foreign firm, or floating shares of the company on the stock exchange.”
However, under the current arrangement where the ECG is to be leased to a foreign company, Mr Affum expressed doubts of a positive of the new deal.
“Currently, Ghanaians are struggling to pay tariffs and with the coming of this private company, which is coming to work for profit and repatriate it, how much are we going to pay for electricity?” he asked.
He feels there are Ghanaian companies with the potential to manage ECG better than any foreign firm.
“So, if privatisation does not mean to sell but to put [ECG] in some private hands for 25 years, the question is, aren’t there Ghanaians who can run this company?”Mr Affum questioned.
He added that there had been too much “political interference” with the management of the ECG, with the state failing to pay an amount of about GHS500 million it owed but was hastening to settle its financial obligations before the new company takes over the running of ECG.
He observed: “The government is making arrangements to clear that liability. Why is it paying that debt now? Is it to ensure the foreign company inherits no debt to ensure it runs smoothly? Why not pay the ECG that money so they can operate more efficiently?
“From the outset when the Millennium Challenge Account was holding stakeholder consultations, they said it would be a partnership. But that cannot be true since the company’s debts are being paid for another to take over its management.”