Govt, organised labour meet today over price hikes
The government and organised labour unions will meet again today to firm up the progress made during last Thursday’s meeting on utility price hikes.
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In November 2015, the Public Utilities Regulatory Commission (PURC) announced a 59.2 per cent increase in electricity tariffs and a 67.2 per cent hike in water tariffs.
Today’s meeting, expected to finalise agreements reached at the maiden meeting between the two on Thursday, January 21, 2016, is expected to be tough, as government and organised labour negotiate further concessions to review the utility tariffs and take another look at the Energy Sector Levies Act 2015 (Act 899).
The thorny issue at today’s meeting will be a shift in government’s position on Act 899 that organised labour wants scraped or reviewed.
The government, on the other hand, has maintained that it is unable to make any concessions in relation to Act 899 because it is an important legislation to put the country’s economy on the right track.
The meeting on Thursday, although scheduled earlier, was held after organised labour unions embarked on a nationwide demonstration on Wednesday, January 20, 2016 to press home their demands.
That meeting resulted in the government making concessions to absorb a decrease in electricity hikes of 54 per cent from the announced 59.2 per cent hike, with organised labour having to do further consultations before deciding today whether to accept or reject the offer.
Scenarios
The Minister of Employment and Labour Relations, Mr Haruna Iddrisu, confirmed to the Daily Graphic that the government would have to cough up about GH₵415 million to absorb the shortfall in electricity tariffs if the hike was brought down to 54 per cent.
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A decrease to 52 per cent would mean an additional GH₵500 million would be needed by the government to take charge of the gap created, while acceding to organised labour’s demands for a downward review to 50 per cent, would mean more than GH₵500 million to support the power sector.
In spite of that, however, Mr Iddrisu indicated the government’s willingness to dialogue further on the issues.
Meetings
However, information gathered before meetings of organised labour unions in Accra yesterday in preparation for the meeting today was that no new mandate had been given by workers to their leaders for the negotiations.
This means that executives of the unions and the government would have to negotiate further for more compromises to be reached.
The Secretary General of the Trades Union Congress (TUC), Mr Kofi Asamoah, speaking to the Daily Graphic before the meeting with the constituents, explained that the 50 per cent reduction being demanded was in relation to the 59.2 per cent hike announced by the PURC.
He said Act 899 had further introduced a levy of 10 per cent on petroleum prices, which was a burden on workers.
Taken together, the electricity tariff hike of 59.2 per cent and the levy of 10 per cent on fuel, as well as hikes in water rates, meant that in totality workers had been hit with taxes and levies of about 70 per cent when their salaries had only been increased by 10 per cent this year, he said.
Mr Asamoah said for the water tariff, organised labour was demanding that original bands for lifeline water consumers had to be maintained.
He, however, was unable to say how much labour was willing to take in reductions with the analysis arrived at until after the meeting with constituents for clarity on organised labour’s position today.
Some workers randomly interviewed were resolute on the issue of the Energy Sector Levies Act 2015, saying that the government could not stick to the position that it was unable to review the act.
They said if the government could review sections of the Income Tax Law 2015 that taxed investments when there was a public outcry, then it could review Act 899 to accommodate their concerns.
PURC
Meanwhile, a press statement by the PURC has stated that the percentage increase across the board for all categories of electricity consumers as announced was 52.9 per cent.
It said for the benefit of consumers, the commission would publish the electricity tariffs as gazetted and published in the Ghana Gazette of December 11, 2015 and with the effective date as December 14, 2015.
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The statement, signed by the Director, Regulatory Economics and Research at the PURC, Dr Simons Akorli, said an order had already been issued to the Electricity Company of Ghana (ECG) to correct the metering and billing anomalies resulting from the implementation of the major tariff increase on their platforms.
It said the ECG had also been directed to develop and implement a detailed communication plan for engaging the public on the tariffs and measures put in place to resolve implementation challenges.
It said the PURC was monitoring all feedback arising from the recent increases and would not relent in ensuring that the ECG discharged its obligations to consumers.
Writer's email: caroline.boateng@graphic.com.gh