Tuesday 29 March 2011

THE OIL AND GAS REVENUE MANAGEMENT BILL AND BASIC EDUCATION -A WINDOW OF HOPE.

The recent oil find has opened a new chapter in
our resource governance discourse, making it
possible for Ghanaians to decide on how oil
revenues should be used. The Ministry of
Finance has accordingly but without adequate
consultation scheduled dates for public
debates on the draft Petroleum Resources
Revenue Management proposal which will
provide a legal and policy guideline for the
utilization of an estimated 1 Billion United
States Dollars per annum of oil revenues
expected to accrue to the Government of
Ghana from September 2010.
Experience shows that whereas some
countries decide to use oil revenues to fund the
national budget, some invest oil revenues in
viable capital investments that are significant in
catalyzing the national agenda. The expected 1
Billion USD from oil revenue per annum adds
up to about 30% of the budget portfolio for
2010. This is highly significant in the sense
that, should oil revenues be used to fund the
budget, it will lead to a 30% increase in the
nations budgetary portfolio, expanding the
prospects for new hospitals to be built, better
salaries for public sector workers, a better
resourced police service, more kilometers of
road, efficient energy supply etc. But in all
these, priority makes a good manager. It is
therefore imperative to commit a significant
chunk of the expected revenue into highly
significant and critical sectors of the economy.
The current 31% of budgetary allocation to
education sector does not only mean it is the
most important, but also it has the highest
financial requirements, recognizing the fact
that Government commits to providing the
education rights of some 6.5 million children in
basic schools and close to 1 million students in
second cycle and tertiary schools. It is
interesting to note however that, the sector has
the highest budget deficit, with an annual
financing gap of about 500 Million USD. The
huge financing gap, coupled with the
dominance of re current expenditure (97%) in
the sector budget hugely limits Governments
ability to embark on capital projects-building
schools, teachers bungalows, libraries etc,
especially in rural areas. This is the main
reason for the over 20,000 classrooms deficits,
schools under trees and lack of teacher
accommodation in rural areas, which ultimately
affects teacher deployment.
The development of education for poverty
eradication should be a non negotiable legacy
from our oil find. This is the only way to ensure
that generations unborn, especially in rural
Ghana, evade poverty. I do agree with the
President's proposal to invest oil revenues in
human development, except that such
investments should specifically go into capital
education investments rather than re current.
GNECC proposes that a minimum investment of
10% of expected oil revenues should be invested
in basic education infrastructure. The
development of education infrastructure,
especially at the basic level, is a huge challenge
to education development in Ghana, with over
2,500 new school buildings needed and 18,000
schools without toilet facilities. Achieving the
Millennium Development Goals on Education in
Ghana will become a mirage if groundbreaking
initiatives are not employed to solve education
infrastructure issues once and for all.
A simple scenario is proposed here: The current
cost of building a fully furnished basic school
stands at 75,000 USD whiles the cost of
constructing a six unit chamber and hall
teacher's quarters is about 25,000 USD. This
means that the proposed 10% i.e. 100 Million
USD per annum investment in basic education
infrastructure will be enough to produce a
thousand schools in a year leaving a surplus 25
Million USD for building about 1,000 six unit
chamber and hall teachers quarters for rural
teachers. Using this scenario, the age old
classroom and teacher housing deficits will be
solved in just two years.
Once the 10% oil revenues takes care of basic
school infrastructure, the GET fund and District
Assemblies can concentrate on expanding and
developing secondary and tertiary education
infrastructure. By the end of the third year,
Ghana would have very little to complain about
school buildings, teachers quarters etc.
In this respect, an independent body, rather then
the Ghana Education Service or District
Assemblies should be constituted to manage the
fund which could be referred to as –Basic
Education Infrastructure Catalytic Fund, which
will be managed by a board that will be directly
accountable to the Minister of Education. Unlike
the GET fund, the board will operate through
decentralized units in all ten regional capitals,
preferably within the Regional Coordinating
Councils and exercise direct oversight on
projects in the districts, in collaboration with
District Assemblies. This will strengthen
supervision and eliminate the lapses in
monitoring and supervision created as a result of
the over centralization of the GET fund.
With only five years to the MDG finish line,
930,141 children remain outside the classroom.
The lip service is too much. It is action time. We
need to take bold decisions to solve tough
problems. Tough problems cannot be solved
with regular “business as usual” approaches.
Government needs to be innovative, decisive
and bold in this respect. The state has a
responsibility to provide quality education for all
children of basic school going age. This cannot
materialize without a decent classroom
environment. Lets without hesitation commit
10% of oil revenue to basic education
infrastructure. The time to act is now, or never.
Education for All: Fund it now
Source:Ghana National Education Campaign Coalition (GNECC)

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