Economy

    Parliament urged to enforce mineral royalty disbursements

    Delays in royalty payments to mining communities hinder development and planning, prompting calls for stronger parliamentary oversight.

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    Ghana's Extractive Sector Multi-Stakeholder Group (MSG) has urged Parliament to summon state agencies regarding persistent delays in disbursing mineral royalties to mining host communities. These delays are actively stalling critical development projects and disrupting local planning efforts. The MSG emphasizes that this situation undermines the core objectives of the Minerals Development Fund Act, 2016 (Act 912). Dr. Emmanuel Steve Asare Manteaw, a member of the MSG, made this call during a media engagement in Accra. The event disseminated findings from the 2023 Ghana Extractive Industries Transparency Initiative (GHEITI) Report. Dr. Manteaw attributed the ongoing delays primarily to weak oversight from parliamentary bodies. He stressed that Parliament must ensure compliance with the Minerals Development Fund Act by holding state institutions accountable for the timely release of approved funds. This issue fits into Ghana's broader economic narrative of ensuring resource wealth benefits local populations. The Minerals Development Fund Act aims to channel a portion of mineral revenues directly to communities affected by mining operations. Consistent delays, however, prevent these communities from realizing tangible benefits, impacting local economies and social infrastructure. This situation also raises questions about the effectiveness of existing legislative frameworks and oversight mechanisms. Dr. Manteaw stated, "A lot of development projects in some of these beneficiary communities have come to a standstill, and the uncertainty over the timing of disbursements makes it difficult for communities to plan development activities with any confidence." He further highlighted Parliament's crucial role, noting, "What is more worrying is the role of Parliament in all this because they passed the law mandating that certain percentages of mineral royalties be disbursed to mining host communities." Parliament's response to this call will be critical in determining the future of mineral royalty disbursements. Increased parliamentary scrutiny could lead to more timely payments, fostering greater stability and development in mining communities. Decision-makers will need to address the identified weaknesses in oversight and coordination to ensure that resource revenues translate into tangible local benefits. The effectiveness of the Minerals Development Fund Act hinges on robust enforcement and transparency regarding outstanding payments. Patrick Nomo, Co-Chair of the GHEITI Multi-Stakeholder Group and Chief Director at the Ministry of Finance, acknowledged improvements in managing extractive revenues. He noted that GHEITI advocacy has contributed to reforms, including changes to the mineral royalty regime. These reforms institutionalized subnational royalty transfers through the Minerals Development Fund, aiming to benefit mining communities more directly. However, Mr. Nomo also pointed out that revenue leakages and weak inter-institutional coordination continue to constrain the sector's contribution to national and local development. He called for stronger institutional collaboration and improved data management to enhance transparency in the extractive sector. Mr. Nomo reaffirmed the government's commitment to using evidence from GHEITI to inform policy reforms and strengthen accountability. Under the Minerals Development Fund Act, mineral royalties are distributed via a statutory formula: district assemblies receive 55 percent of the local government allocation, mining-affected communities receive 25 percent, and traditional councils receive 20 percent.

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