Three agencies to go off govt subvention
The Fair Wages and Salaries Commission (FWSC) and the Ministry of Finance have completed the process of weaning three government agencies off government’s subvention.
They are the Driver and Vehicle Licensing Authority (DVLA), the Environmental Protection Agency (EPA) and the Energy Commission (EC).
The weaning off is part of plans to trim down the wage bill as government hopes to save between GH¢20 and GH¢25 million with this implementation which will be done in three phases.
A source at the FWSC explained that modalities for the weaning off included the financial performance of the agencies in the last three years; and their medium term projections were achievable.
“We look at the company’s last five years financials and next five years financials. The committee sits down and does the analysis and see if this institution can go off and if it can be immediate or in the next two years. After which they will come out with recommendations which will be sent to the Ministry of Finance, where the internal committee that sees to the implementation of the recommendations begin the process of weaning them off government subvention,” the source said.
Initially, 12 agencies including the Korle Bu and Komfo Anokye teaching hospitals and the three universities, the University of Ghana, Legon, Kwame Nkrumah University of Science and Technology and the University of Cape Coast were scheduled to go off government subvention.
However, government later took a decision to hold on with that of the teaching hospitals and the educational institutions, even as the committee continued to explore other institutions that it could bring on board.
The next batch of agencies to be weaned off soon includes the Data Protection Commission, Gaming Commission and National Pensions Regulatory Authority (NPRA).
How prepared are the agencies
Retention of a percentage of the internally generated funds (IGF) by these agencies will depend on the analysis by the committee.
“If they say an agency should be given 100 per cent retention of their IGF or just 30 per cent or 40 per cent it will be given. Or they can allow them to keep 100 per cent for a period of one or two years after which they would have to reduce it to say 20 per cent,” the source said.
The agencies are being guided of the national budget to enable them to clean up their balance sheets, which would help them source commercial financing from the market.
Most of the agencies are said to be working feverishly to go this is because certain internal procedures may have to change, including setting up bank accounts.
The DVLA, for instance, has said that all necessary measures had been put in place to ensure it entered the phase of its development smoothly.
“Now that we have been given the chance to go on our own, we should prove to the government that we are capable to manage our own affairs,” Mr John Noble Appiah, Chief Executive Officer of the DVLA said.
He added it was time for the staff to think outside the box and challenge the status quo to generate the needed income to fend for itself. — GB