Monday, June 1, 2015

Why is the government setting such a bad example?

Monday, June 1, 2015
Folks, much has been said about the government’s handling of the country’s finances, which speaks volumes. There is much concern that things are not being done properly, which is why the government is either borrowing funds from sources and not accounting for such funds. We have heard about the government’s inability or failure to sustain the GETFUND, to pay workers’ contributions to SSNIT, to release funds to the NHIS, to provide funds for the Schools Feeding Programme, and many more. It is more than alarming. Why should it be so?
Today, we are being told that the “government has defaulted in the payment of workers contribution to the Tier 2 pension scheme, to the tune of GH¢1billion—plunging the state into a nonpayment crisis”. Haruna Iddrisu, Minister of Employment and Labour said so.

According to the news report, this liability adds to the GH¢288 million owed the Social Security and National Insurance Trust (SSNIT) as the Tier-1 operator while the government continues to borrow from salaried workers by running arrears. Mr. Iddrisu told Parliament that the debts will be cleared by cash and bond issuance at an unspecified future.
“It is true that the state owes SSNIT and the second-tier contribution. Government owes SSNIT GH¢288million as at April 2015, but it has honoured its obligations from 2010 up to April this year. In respect of the second tier, there is an outstanding of not less than GH¢1billion and the Ministry of Finance through cash and bond issuance is working to honour the obligations,” he said. (See http://www.ghanaweb.com/GhanaHomePage/NewsArchive/artikel.php?ID=360414)
MY COMMENTS
What is wrong with the government? Managing public funds so those shedding their sweat, blood, and tears to feed the national coffers can get their money’s worth and be assured that they are not being undermined is a major responsibility in a democracy. From what has been reported so far, there seems to be something seriously wrong with the government’s handling of funds, which is dampening the spirits of the tax payers and fuelling dangerous speculation that “a create-and-loot” agenda is being implemented.
At no other time in our 4th Republic have we heard so much about the government’s liability regarding borrowing of funds from such non-traditional sectors or being unable to provide funds to statutory institutions to function. And the government’s failure to explain issues in a timely manner is not only irritating but it also feeds the rumour machine and its opponents to do dirty politics. What at all is happening? We are seriously apprehensive and are sitting on thorns. What again will we be told about such liabilities in other sectors? The government isn’t giving a good account of itself on this score.
What have the funds borrowed from those sectors been used for? Development projects? Which of them? How were the development projects determined and initiated without any prior planning regarding the sources of funding? Or what else could have forced the government to do what it has done so far to raise eyebrows? To pay workers’ salaries because of shortfalls in earnings (meaning robbing Peter to pay Paul)? Someone in government has a lot of explaining to do here and now.
It is mandatory for employers to send workers’ social security contributions to SSNIT; and the government—being the largest employer of workers in Ghana—has the responsibility to set a good example. If it fails to do so, what moral or legal justification will there be for the State to prosecute other employers who fail to do so? (I have the example of Mr. Aggudey of Goldcrest in mind. No wonder that he was set free for weird reasons!!). Who will go to court to compel the government to come clean?
I emphasize here that the government is being grossly irresponsible and must bow its head in shame. This kind of attitude doesn’t cultivate a good public image for it nor will it grab any political capital for it. It demoralizes the citizens and carves a very bad name for it. Immediate steps must be taken to reverse this trend.
Mr. Iddrisu’s opinion that “the Ministry of Finance through cash and bond issuance is working to honour the obligations” is equally annoying just for the fact that issuing cash and bonds won’t serve any long-term purpose as far as management of the economy is concerned. It is just like the negative practice by some unscrupulous District/Municipal/Metropolitan Chief Executives to invest public funds allocated to their Assemblies by the District Assemblies Common Fund Administration in treasury bills and then turn out to reap the profits. It is a rip off to be condemned. Such a practice amounts to outright stealing and shouldn’t be tolerated in a democracy like ours.
Clearly, the government has a lot of explaining to do to assuage doubts, fears, and concerns about its style of managing public funds. It is expected to take practical action to solve such problems if it wants to retain whatever public goodwill there is left for it. As soon as issues of this sort crop up, they set tongues wagging in all directions and erode public confidence in the government.
I have said it several times already that a democracy thrives on a sound economy because democracy is expensive to operate. And if the government doesn’t handle public funds properly to assure the citizens that their sacrifices and contributions are protected and being used for the right cause, it creates the fertile ground for sabotage. We have come a long way to become resilient and don’t want to be pushed to the wall,
If workers' pension issues are not responsibly handled, there is no way anybody can expect productivity to be raised. After all, why does one "kill" oneself to work? Not for a secure future on retirement because one expects to enjoy the fruit of one's labour over many years of dedicated service to country and people?
In Ghana, those due for pension are always wary of their post-office lives because of the sordid manner in which pension issues are handled. The administrators of the pension scheme make matters worse when they frustrate the would-be pensione(e)rs.
Through subterfuge and plain sabotage, files get missing, negative tactics are used to extort money from those poor would-be pensione(e)rs before documents are processed for them to be paid the peanuts due them, and many other nasty techniques are used to frustrate them. Some die in consequence without enjoying the fruit of their labour while some covert schemes exist for unscrupulous people to siphon away their benefits. In Ghana, then, reaching the point of retirement is more than nightmarish. It is a death sentence passed on the individual by the system.
The government must not add to the woes of such people. Doing so is the height of heartlessness; it is more than demoralizing; it is criminal. And someone must be taken to task. Mr. Iddrisu must tell us what we need to know: Who gave the directive for such funds to be misappropriated? What exactly were such funds used for? How are they to be reimbursed? Many more questions will be raised for the government to respond to.
No one should under-estimate the enormity of this liability. It is a disincentive to the workers and must be condemned outright. Such a practice must stop forthwith. Our Parliament should have taken up this matter long before now; but because it is a deadwood, it cannot. Its inability to do so is our bane in this kind of lame democracy.
I shall return…
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