STATEMENT: Gov’t Reacts To Minority’s Allegations That $177m Illegally Withdrawn From Petroleum Fund

Government has denied accusations that an amount of US$176.49 million from the Petroleum Stabilization Fund has been illegally withdrawn as claimed by the Minority in Parliament.

The Minority on Monday accused government of illegally utilizing the Petroleum Stabilization Fund in violation of the law.

The Petroleum Revenue Management Act (Act 815) is regarded as a novelty in the management of natural resource rents globally.

Section 5 of the Act states: “(l) The amount in the Petroleum Holding Fund earmarked for transfer into the Ghana Petroleum Funds, shall not be used (a) to provide credit to the government, public enterprises, private sector entities or any other person or entity, and (f;) as collateral for guarantees, commitments or other liabilities of any other entity”.

At a press conference in Accra, Member of Parliament for Juabeng South, Dr. Mark Assibey Yeboah, said the group has “credible evidence” to back this claim and “strongly urge Parliament to investigate this issue and we ask the government and the Bank of Ghana to come clean on this“.

But in sharp rebuttal, government through the Ministry of Finance has denied the allegation.

A statement signed by a Deputy Finance Minister, Cassiel Ato Forson clarified that “the Ministry wishes to reiterate that government has not used the US$176.49 million, which represents the excess over the cap on the GSF as at end-March 2014, to close its financing gap.”

He added that the NPP is “basically repeating what ACEP [Africa Centre for Energy Policy] accused government of last week which we responded to adequately.”


The Ministry of Finance has noted with concern allegations by the New Patriotic Party (NPP) at a press conference today that government had illegally withdrawn US$177m from the Petroleum fund, basically repeating what ACEP accused government of last week which we responded to adequately.

For the benefit of all stakeholders and Ghanaians at large, the Ministry wish to reiterate that government has not used the US$176.49 million, which represents the excess over the cap on the GSF as at end-March 2014, to close its financing gap.

We are re-issuing the press statement below which the Ministry released last week which adequately addresses the allegations by ACEP and the NPP as far as the Petroleum Funds are concerned.


The Ministry of Finance has sighted a release by the Africa Centre for Energy Policy (ACEP), accusing Government of “abuse of the fiscal discipline provided in the Petroleum Revenue Management Act, 2011 (Act 815)”.

In the release, ACEP accuses Government of using moneys from the excess over the cap on the Ghana Stabilisation Fund (GSF) to “finance expenditure contrary to the provisions of the Petroleum Revenue Management Act”, circumventing the powers of Parliament and violating the Constitution in the process.

This press release seeks to provide some background information on the basis for the cap on the GSF, while clarifying the misconception published by ACEP to undermine the very successful implementation of the PRMA, which they seek to ensure.


Section 23(3) of the PRMA states that “The accumulated resources of the Ghana Stabilisation Fund shall not exceed an amount recommended by the Minister and approved by Parliament and the amount shall be reviewed from time to time as necessitated by macroeconomic conditions”.

Section 23(4) of the PRMA also states that once the cap is attained “… subsequent transfers into the Ghana Stabilisation Fund shall be allocated as transfers into the Contingency Fund or for debt repayment approved by Parliament”.

The 2014 Budget Statement and Economic Policy of the Government of Ghana proposed to cap the GSF at US$250 million in line with Section 23(3) of the PRMA; and to use the excess over the cap for debt repayment and to establish the Contingency Fund, as proposed in the Constitution of Ghana.

This is captured under paragraph 972 of the 2014 Budget, which reads as follows:

“In line with Section 23(3) and (4) of the PRMA, it is proposed that the GSF be capped at US$250 million and the excess amount utilized for debt repayment and setting up the Contingency Fund (envisaged under the Constitution)… An amount of GHȻ50 million from the excess of the cap on the GSF is proposed to initiate the setting up of the Contingency Fund to meet urgent or unforeseen need for expenditure for which no other provision has been made”.

The proposals to cap the GSF and to use the excess funds over the cap to establish the Contingency Fund and for debt repayment were approved by Parliament, as captured in column 3647 of the Official Report of Parliament (The Hansard, Fourth Series, Vol.84, No.31) on Tuesday, 17th December, 2013.


The GSF balance as at end-December 2013 stood at US$319,034,153.16, as indicated in the 2013 Reconciliation Report on the Petroleum Holding Fund, which is available on the Ministry’s website (

In the first quarter of 2014, a total of US$107,457,183.71 accrued to the GSF. This brought the total GSF balance as at March 31, 2014 to US$426,491,336.87.

Given the GSF cap of US$250 million, the excess over the cap at end-March 2014 was One Hundred and Seventy-Six Million, Four Hundred and Ninety-One Thousand, Three Hundred and Thirty-Six United States Dollars, Eighty-Seven Cents (US$176,491,336.87).

The Ministry of Finance wrote to the Controller and Accountant-General to instruct Bank of Ghana to use the equivalence of GHȻ50 million of the US$176.49 million to set up the Contingency Fund, as proposed in the 2014 Budget, and transfer the rest into the Debt Service Account for debt repayment.


The Bank of Ghana has established the Contingency Fund with an amount of GHȻ50 million. This amount was drawn from the excess over the cap on the GSF.

The fact that the Contingency Fund exists today with a balance of GHȻ50 million testifies to the fact that no moneys have been spent from it.

This defeats ACEP’s claim that the excess amount over the GSF cap never reached the Contingency Fund since the Contingency Fund was first established in May 14, 2014 with the GHȻ50 million.

The remaining amount has been deposited into the Debt Service Account for debt repayment and due process will be followed before the use of the money.

It is very inaccurate for ACEP to suggest that the US$176.49 million, which represents the excess over the cap on the GSF as at end-March 2014, has been used by Government to close its financing gap. It is also untrue that Parliament’s powers have been usurped and the Constitution violated.

We would like to place on record that our management of petroleum revenue has been in line with the PRMA. We, therefore, accept the challenge by ACEP for an investigation to be carried out on the use of the excess funds over the GSF cap in order to put this matter to rest.

We would plead with ACEP and other stakeholders to research well and verify matters of public interest and help educate the public rather than peddling untruths which require public officials to spend precious time to rebut. We believe that ACEP should have consulted the Ministry on the matter before rushing to the press. END