Ghana’s Petroleum Revenue Management Act (PRMA) has arguably improved the transparency of petroleum revenue allocation. This is borne out by Public Interest and Accountability Committee (PIAC), Ministry of Finance, Ghana National Petroleum Corporation and Bank of Ghana publications regarding how much petroleum revenues are collected and where they go.
However, there are concerns the act has not adequately addressed issues relating to revenue volatility and expenditure smoothing, or contributed to overall fiscal sustainability. Petroleum revenue management in Ghana, guided by the legislation, faces critical challenges. Many complexities in executing and interpreting the PRMA have also caused digressions from the spirit of the act. Therefore, there is an urgent need to go back to the basics to align with the core principles of the PRMA and to identify and consider potential reforms.
This brief highlights some of the implementation challenges of PRMA provisions. It makes recommendations to improve petroleum revenue management in Ghana in the future. This discussion is particularly important for Ghanaians now: the implementation of new social programs like free senior high school (“Free SHS”) will rely in part on petroleum revenues and require a sustainable financing plan.