Reduce Fuel Prices – Minority

Dr. KT Hammond
The Minority New Patriotic Party (NPP) in Parliament has called on the government to further review fuel prices downwards to GH¢9.39 per gallon from the current price of GH¢13.86 to fairly reflect the current world market price of crude oil, which is selling at below $50 per barrel.

Government announced a 10% reduction in fuel prices from GH¢16.05 to GH¢13.86 but the Minority says that is unfair and insensitive on the part of the government, looking at the percentage reduction on the world market.

‘Between January and July 2013, petroleum product prices went up by about 61.3% – that is from GH¢9.95 per gallon to GH¢16.05 per gallon. All of these increases were justified, using the international crude oil prices. In July this year, crude oil was being sold at $114 per barrel and as a result, the government in July increased prices by 23%,’ the Minority observed in a statement signed by its ranking member on energy, K.T. Hammond.

‘By using the prevailing prices, petrol should be selling at GH¢9.39 per gallon instead of the current GH¢13.85 – a further reduction of about 32%.  We in the NPP insist that if indeed the NDC government cares for the already suffocating people of this country, they should further reduce the price of petroleum prices immediately,’ it added.

Mr Hammond said although international prices continue to fall, it seems the ruling National Democratic Congress (NDC) government has decided that consumers should not have any respite, even though it (government) knows quite well that it is not the fault of the Ghanaian consumer that its finances are in such a bad shape.

According to the Adansi Asokwa MP, the NDC government, on top of these high prices of fuel, introduced a 17.5% tax to cream away the benefits that should have accrued to the Ghanaian consumer.

‘At the time the government was introducing this new tax, crude oil prices had fallen from $114 per barrel to $79 per barrel. So using the crude oil price as a proxy, premium petrol should have been sold at GH¢13.4 per gallon instead of GH¢15.4,’ the Minority noted.

Government, the NPP said, has enough taxes in the price build-up to pay for all its indebtedness to the main suppliers, even after this proposed reduction which the party insists government should do once it sits down to negotiate with those suppliers.

‘In the price build-up, there is the TOR Debt Recovery levy, the Excise Duty Specific and the newly added Ad-valorem 17.5% tax.  These taxes can more than pay for whatever indebtedness.  We are also concerned that the 17.5% Ad-valorem tax is not charged on the ex-refinery price but rather on the ex-depot prices, after all the taxes and levies have been added.

‘We are therefore, asking the NDC government to immediately reduce fuel prices in tandem with the world market prices,’ it charged.

‘Ghanaians,’ the statement pointed out, ‘have suffered enough and deserve a break. Don’t squeeze us to make up for your own incompetence.’

By Thomas Fosu Jnr

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