Parliament approves US$100 million loan facility to finance GSCSP


Parliament has unanimously approved a US$100 million financing agreement between Ghana and the International Development Association (IDA) to finance the proposed Ghana Secondary Cities Support Programme (GSCSP).


The Chairman for the Parliamentary Select Committee on Finance and Member of Parliament for New Juaben South, Dr. Mark Assibey-Yeboah, informed the House that the Programme Development Objective (PDO) is to improve urban management and basic urban services in the participating Municipal Assemblies (MA).

Presenting the Finance Committee’s report at the Plenary in Parliament, Dr. Assibey-Yeboah stated that the Programme will focus on improving the institutional performance of urban management and basic urban services.

Dr. Assibey-Yeboah pointed out that the Committee finds the Ghana Secondary Cities Support Programme important, for improving local government outcomes in the country, through the provision of quality urban infrastructure and enhancing institutional capacity for urban management.

Minority’s reaction

In supporting the motion on the US$100 million facility loan, the First Deputy Minority Whip, Mr. Ahmed Ibrahim, lamented that decentralisation must be one of the areas the government must pay much attention to.

Mr. Ibrahim added that there is the need to develop other cities across the country to decongest the Greater Accra Region.

Debating on the motion on the floor in accordance with Order 146(1) and (2) of the Standing Orders of Parliament, Mr. Ibrahim reiterated that new municipalities should be developed to support the newly proposed regions.

“There should be new municipality in the Northern Region to aid in the newly proposed Oti Region. There should be another municipality in Brong-Ahafo Region to support the newly proposed Ahafo Region. Some areas in the Ashanti Region must be opened up for development to reduce Rural-Urban Migration”, he concluded.

Resolution on the motion

The Majority Leader and Member of Parliament for Suame, Mr. Osei Kyei-Mensah-Bonsu, moved for the resolution of the motion and was seconded by Dr. Assibey-Yeboah.

Resolution was passed and approval was granted by the House pursuant to Article 181 of the 1992 Constitution, Order 148 of the Standing Orders and Sections 55 and 56 of the Public Financial Management Act, 2016 (Act 921).

Terms and Conditions of the loan facility 

The loan facility by the International Development Association has 5 years of grace period and 25 years of repayment period. The loan also has 30 years of maturity period and a maximum commitment charge of 0.5 percent per annum.

Service charge for the loan facility is 0.75 percent per anum while interest rate covers 1.25 percent per annum. On the grant element of the loan, 33.23 percent is covered.

Programme description

The Programme is comprised of three windows.

The 1st Window (Local Window) is where participating Municipal Assemblies, will receive Urban Development  Grants of US$87 million and Capacity Support Grants of US$3 million.

The municipal Assemblies would be allowed to make investments in urban infrastructure and service delivery with the Urban Development Grants whilst the Capacity Support Grants would be used to invest in institutional and capacity development initiatives aimed at enhancing their management performance.

The 2nd Window (Regional Window) will be provided with funds of US$3 million to backstop, mentor and monitor Metropolitan, Municipal and District Assemblies within their respective Regional jurisdiction.

It will also ensure that the MMDAs’ annual District Performance Assessment Tool (DPAT) assessment results are up to national average scores.

The 3rd Window (National Window) will be able to access funds in order to strengthen policies, support monitoring functions with respect to urban management and development as well as annual performance assessments of participating Municipal Assemblies.

Source: GhanaJustice/S.Ayisi


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