The unending debate over tariff adjustments

BY: Arku Jasmine

The supply of water and electricity to consumers still falls below demand, hence the ongoing water and power rationing exercises. Consumers and utility companies have engaged in raging polemics over the right tariffs that will be affordable to consumers and reasonable to keep the companies in business.

The utility companies have initiated the process to get the Public Utilities Regulatory Commission (PURC) to review the tariffs, arguing that the companies risk collapse if action on the request is not taken soon.

The timing of the whole process of tariff adjustments is bad because the request has been made at a time the utility companies are unable to delight their customers.

For almost 10 months now, Ghanaians have been experiencing power rationing, otherwise known as ‘dumsor dumsor’, that has crippled businesses or raised the cost of doing business to astronomical levels.

The utility companies have always attributed their poor services to the unrealistic tariffs being paid by consumers, insisting that if consumers want better services, then they must be prepared to pay more.

Many consumers think otherwise. Although there may be a case for some level of increase in tariffs, the fact still remains that the utility companies have for a long time passed on their inefficiencies to consumers by way of high tariffs.

If that is not the case, then how come  about 25 per cent of power produced is lost through operational inefficiencies?

For water, burst pipes are common spectacles in all urban settings out of which volumes of water go to waste.

In addition to these challenges, the utility companies are saddled with huge debts in unpaid bills by individual consumers and the government.

The PURC has organised many forums to collate views from consumers on the proposals from the utility companies — the Volta River Authority (VRA), the Electricity Company of Ghana (ECG), the Ghana Grid Company (GRIDCo) and the Ghana Water Company Limited (GWCL) — for an upward review of tariffs at 166 per cent over the present tariff levels.

Officials of the PURC and the utility companies, at the weekend, called on the Ashanti Regional House of Chiefs in Kumasi to take their campaign to the chiefs in the hope that Nananom could reach the people with the crusade for an upward adjustment in tariffs.

The Asantehene, Otumfuo Osei Tutu II, was reported to have said that he appreciated the need for an increment in tariffs to meet the cost of demand but said consumers should not be made to pay for the failure of companies which refused to do what was expected of them.

The Asantehene hit the nail right on the head by impressing on the utility providers to weed out the dead woods in the system, so that they could become more efficient.

The Daily Graphic thinks that there is too much government interference in the operations of the utility companies in so far as government agencies owe these companies millions of cedis in unpaid bills.

How, then, do we expect these companies to deliver if we do not pay the utility bills promptly? We see the need for upward adjustments in tariffs, but those adjustments will be swallowed by the inefficiencies of the utility companies if the boards of those companies do not insist on increased productivity and targets, especially for the management staff.

The Daily Graphic believes that the only way to save the VRA, the ECG, GRIDCo and the GWCL from imminent collapse is to put in place efficient management teams that can dare even the government to pay its bills and deal with workers who connive with miscreants to undertake illegal connections.