Govt urges TUC to review stance

The government has urged the Trades Union Congress (TUC) to review its stance on the 10-day ultimatum it has given to it and the Public Utilities Regulatory Commission (PURC) to reduce utility tariffs.

Addressing journalists yesterday at the Flagstaff House, the Minister of Information and Media Relations, Mr Mahama Ayariga, said the TUC should rather engage the PURC and utility providers in a dialogue on the tariff increases instead of threatening an industrial action.

He also said the government was ready to dialogue with the TUC on the issue of water and electricity tariffs.

The PURC approved 78.9 per cent and 52 per cent increases in electricity and water tariffs respectively, with effect from October 1, 2013.

But on Tuesday, October 8, 2013, the TUC held a press conference at which its Secretary-General, Mr Kofi Asamoah, gave the government and the PURC a 10-day ultimatum to reduce the utility tariffs or face a nationwide strike.

In its response, the government issued a press statement indicating it had requested a working group it set up to look into the impact of recent utility tariff hikes to present its preliminary report for mitigation measures to be taken.

The statement  by Mr Ayariga said the technical working group was set up to make appropriate recommendations to the government on what measures to take to mitigate the impact of the new tariffs on the government's budget, as well as domestic and industrial users of utility services.

Throwing more light on the issue, Mr Ayariga said the TUC’s threat on the government was misdirected since it was the PURC that fixed utility tariffs.

"We find the threat on government as being misdirected when we know that the adjustment is done by PURC. We find that threat of the TUC will create a very difficult problem for all of us. The PURC is the legal entity that should not be controlled by the government or any other body. The TUC’s threat is an attempt to coerce the government into violating the law," he said.

The information minister said the call by the TUC for the government's intervention could mean that the labour union wanted the government to continue subsidising the cost of electricity and water. Otherwise, he added, the government would have to increase taxes to be able to generate the needed revenue to pay for the extra cost of utilities.

Mr Ayariga also said the government was not against subsidies, but  that subsidies in the energy sector tended to favour the rich rather than the poor.

Therefore, he said, it was better for the government to direct subsidies to more critical areas such as health and education.

The information minister admitted that the failure by the PURC to increase utility tariffs based on the Automatic Tariff Adjustment Formula in the past, as suggested by the TUC, contributed to the current quantum increase in utility tariffs.

Therefore, he said, the call by the TUC now on the PURC to reduce utility tariffs was tantamount to asking the commission, whose membership included members of the TUC and the Association of Ghana Industries, to sustain the unrealistic tariffs.

The information minister also said the government was concerned about the increase in utility tariffs, and indicated "we are looking at ways of ameliorating the situation."

By Musah Yahaya Jafaru/Daily Graphic/Ghana