The President of the Ghana Union of Traders’ Associations (GUTA), Clement Boateng, has criticised the recent utility tariff hikes, arguing that the current economic conditions do not justify the adjustments announced by the Public Utilities Regulatory Commission (PURC).
His comments follow PURC’s third-quarter tariff review, which increased electricity tariffs by 3.49 per cent and water tariffs by 0.85 per cent.
The Commission explained that the latest adjustments were largely driven by exchange rate pressures, despite a decline in inflation and stable electricity generation levels.
Speaking in an interview on Joy FM’s midday news on Thursday, June 25, Mr Boateng said GUTA is not against tariff reviews in principle, acknowledging that utility service providers need adequate resources to sustain their operations.
However, he insisted that the reasons given by PURC do not reflect the current economic realities.
“It is not about simply opposing tariff increases because we all know that utility companies need money for their operations. What we are saying is that when you examine the reasons they have provided, the current situation does not support the basis for these increases,” he said.
According to him, one of the major reasons cited by PURC was the depreciation of the Ghana cedi against major foreign currencies, but he argued that the decline was too marginal to warrant the latest adjustment.
“It is true that the exchange rate has experienced some depreciation recently. Between April and May, the average depreciation was about 4.18 per cent. We believe this is insignificant and does not call for an increase in utility tariffs,” he stated.
Mr Boateng further argued that the real problem facing utility providers lies in operational inefficiencies rather than inadequate tariffs.
He pointed to heavy losses within the Ghana Water Company Limited and the electricity distribution system, attributing them to theft, illegal connections and wastage.
According to him, utility companies should prioritise reducing these losses instead of depending on frequent tariff hikes to boost revenue.
“If you take Ghana Water Company, for instance, they are recording operational losses of between 51 and 52 per cent. In the electricity sector, operational losses are around 32 per cent. These losses arise from theft, illegal connections and wastage within the system,” he explained.
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