Making Every Pesewa Count in Managing Ghana's Oil Revenue: The Role of Value for Money Audit

Oil production does not automatically transmit into development. It is the daily actions and policies that help to channel oil resources and revenues into economic and social development. The 1992 constitution places the ownership of the land and natural resources in the citizens of Ghana. Policy makers are therefore managing these resources on behalf of and for the benefits of Ghanaians. Therefore, the passage of the Petroleum Revenue Management Act (PRMA, Act 815) was timely and necessary to prevent institutional and political lapses that have led to the ‘oil curse’ in some oil producing African countries and also provide timely information on oil receipts and expenditure. These notwithstanding, it is important to examine the adherence to the principles of the law and ascertain the efficiency and impact of oil expenditure. The Africa Centre for Energy Policy (ACEP) helps to analyse these expenditures and measures value for money in three main ways: first, ACEP tracks total oil receipts and examine allocations to the Ghana Petroleum Funds, the Ghana National Petroleum Corporation and the Annual Budget Funding Amount annually. Further, allocations from the Annual Budgeting Funding Amount (ABFA) are analysed. Finally, ACEP carries economic and social impacts of the specific projects that were funded from the ABFA in the four priority areas, namely expenditure and amortization of loans, agriculture modernization, capacity building, and roads and other infrastructure. For the purpose of this value for money audit, ACEP has analysed five projects. In analysing these five projects, the following observations were made:

The Africa Centre for Energy Policy (ACEP) was established in 2010 to contribute to development of alternative and innovative policy interventions through high-quality research, analysis and advocacy in the energy and extractives sector in Africa.

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