Capping of Minerals fund: Cabinet considering waiver— Duker

BY: Timothy Ngnenbe
Mr. George Mireku Duker (right), Deputy Minister, Lands and Natural Resources, addressing the participants in the multi-stakeholders’ workshop
Mr. George Mireku Duker (right), Deputy Minister, Lands and Natural Resources, addressing the participants in the multi-stakeholders’ workshop

The Ministry of Lands and Natural Resources has tabled a proposal before Cabinet for the waiving of the cap on the Minerals Development Fund (MDF).

The move is to ensure that the required 20 per cent of mineral royalties is channeled into the MDF to undertake impactful development projects in mining communities.

A Deputy Minister of Lands and Natural Resources, Mr. George Mireku Duker, who made this known yesterday, said the capping of the MDF by the central government through the Earmarked Funds and Capping Realignment Act, 2017 (Act 947) had negatively affected the availability of funds to undertake infrastructure projects at the local communities as mandated by the MDF Act, 2016 (Act 912).

"The MDF is meant to impact positively on development projects of mining communities; but the Administrator of the Fund and Local Management Communities (LMCs) have been complaining that the money they get is not enough to have measurable and tangible projects.

“The minister of Lands and Natural Resources has tabled the issue before Cabinet and we believe that the 20 per cent of mineral royalties is for development, so if the cap is waived and we get it as a whole, mining communities will benefit more from the MDF," he said.


Mr. Duker was speaking at the opening of a two-day national multi-stakeholder workshop organised by the MDF and the Ghana Extractive Industries Transparency Initiative (GHEITI) for stakeholders in mining communities.

The workshop brought together key stakeholders such as Metropolitan, Municipal and District Chief Executives (MMDCEs) from mining regions, traditional rulers, youth groups and other identifiable groups from local mining communities.

It was meant to, among other things, strengthen collaboration between the MDF and other local actors in mining communities and to create an enabling environment knowledge sharing on effective accountability regimes for the fund.

The MDF was established through the MDF Act, 2016 (Act 912) to provide additional revenue for development projects in communities impacted by mining.

The MDF derives its funds from 20 per cent of mineral royalty received from the Ghana Revenue Authority (GRA) from holders of mining leases; money approved by Parliament for the fund; grants, donations, gifts, as well as money that accrues to the fund from investments made by the MDF board.

Section 21 of the MDF Act allocates 80 per cent of revenue that accrues from the mining sector to the Consolidated Fund while 20 per cent goes to the MDF through the Office of the Administrator of Stool Lands (OASL).

Also, Section 16(1) of Act 912 provides for the establishment of Mining Community Development Schemes (MCDS) for each mining community to facilitate socio-economic development of host communities while section 19 of the Act also requires the establishment of Local Management Communities (LMCs) to oversee the implementation of development projects.

Timely releases

Mr. Duker assured managers of the MDF that the Lands and Natural Resources Ministry would continue to push for timely release of funds to the MDF to deliver on its mandate.

He observed that through proactive measures, the ministry had engaged the Ministry of Finance leading to the new paradigm where funds were released from the Minerals Income Investment Fund (MIIF) into the MDF instead of the GRA.

"I have particular interest in the development of mining communities, so as long as I remain the Deputy Minister in charge of the mining sector, I will work to ensure expeditious release of funds to the MDF," he said.

Good initiative

For his part, the Administrator of the MDF, Dr. Norris Kwaku Hammah, described the move by the ministry to remove the cap on the fund as a step in the direction.

In his view, the waiver would improve the quality of life of the residents of mining communities who had been starved of the needed development over the years.

Dr. Hammah called on members of the LMCs to work diligently and put funds allocated to the MCDS to good use for the benefit of mining communities.

The Chairman of the MDF Board, Mr. Kwaku Sakyi-Addo, urged the LMCs to roll out targeted projects that would help to upgrade their communities.

That, he said, required transparent and judicious use of funds.