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On July 10 2019, Vice President Dr Mahamudu Bawumia in a tweet via his official Twitter account enumerated and juxtaposed 22 major achievements of the New Patriotic Party (NPP) two and a half years into their administration contrasted against the performance of the National Democratic Congress (NDC).
Diverse reactions met Dr Bawumia’s tweet. Some Ghanaians have applauded Dr Bawumia and the government for these achievements while others were taken aback by the comparison. The latter criticised the vice president for being insensitive to the plight of Ghanaians, which is not reflective of the achievements he touted. The tweet in question, had over 4.2K likes, 1.2K comments and 755 retweets, as of the time this fact-check was conducted.
In an effort to ascertain the veracity of the claims, DUBAWA fact-checked some of them.
Verification of Claims:
CLAIM 1: NDC cancelled teacher training allowances; NPP restored it
TRUE: The NPP government restored the Teacher Training Allowance which had been scrapped by the erstwhile NDC government in 2014
The teachers allowance policy was introduced by Ghana’s first President, Dr Kwame Nkrumah, with the aim of attracting people to the profession. It was subsequently repealed in the 1970s by the Busia administration, but was reintroduced again in the 1980s following a mass exodus of teachers to Nigeria in search of greener pastures.
The NDC government under President John Dramani Mahama in 2014 cancelled the policy, amidst opposition from trainees and members of the NPP, and directed that trainees gain access to the Students Loan Trust Fund which is at the disposal of tertiary students in the country. A feeding grant policy was also introduced to fill the gap created by the repeal of the policy. According to the government, the need to increase access and quality were the rationale for the cancellation of the allowance.
In fulfilment of its campaign promise to bring back the allowance when voted into power, the government, in 2017 announced the restoration of training allowances for teachers in its maiden budget. A ceremony was subsequently held at the Accra College of Education to mark the restoration of the allowance. This was in spite of opposition from a section of the public who argued that the policy has outlived its usefulness.
CLAIM 2: NDC cancelled nursing training allowances; NPP restored it
TRUE: The restoration of the allowance was announced in the 2017 Budget Statement and was marked by a ceremony in Sunyani.
Like the teacher training allowance, Dr Bawumia also claimed the NPP had restored Nurses Training allowance while the NDC had cancelled the policy.
This claim is true as information available shows that the previous government had indeed, in 2014, scrapped the policy. This move was criticised by the then opposition NPP which promised to restore the allowance when voted into power.
Consequently, the NPP government announced the restoration of the nurses’ training allowances in the 2017 Budget Statement and Economic Policy. A ceremony was held in Sunyani to mark its restoration. Funds were later released to the Ministry of Health for the payment of the allowance.
CLAIM 3: NPP brought about the reduction in 17 taxes with some being abolished; in the wake of NDC’s tax increment.
TRUE: While the NDC government had increased taxes when it was in power, the NPP has abolished or reduced 17 taxes in its two and a half years in power. However, the NPP government has also introduced new taxes and increased some taxes.
To verify this claim, we relied mostly on the Budget and Economic Statements of 2009-2016 for the NDC and 2017-2019 for the NPP.
Information available in the Economic and Financial Policies For the Medium Term Report and the 2015 Budget Statement, shows that the NDC government had indeed introduced and increased taxes during its tenure in power. The Minister for Finance at the time, Mr Seth Tekper, said the imposition of the new taxes was necessary to generate more revenue for the country and to consolidate government finances by reducing the fiscal deficit. The following are some of the taxes that were introduced and increased during the NDC’s tenure in power:
1. The imposition of National Fiscal Stabilisation Levy of 5 per cent
2. The imposition of Special Import Levy of 1 and 2 per cent on some imported goods
3. Re-imposition of import duty of 20 per cent and VAT on imported mobile handsets
4. VAT was increased from 12.5 percent to 15 per cent
5. The imposition of Vat on fee-based financial services
6. The imposition of a 5 per cent flat VAT on real estates
7. The imposition of Special Petroleum Tax of 17.5 per cent
8. An increase in the withholding tax on Directors’ remuneration from 10 per cent to 20 per cent
9. An increase in withholding tax on rent on commercial properties from 8 to 15 per cent
10. An increase in the withholding tax on management and technical services from 15 per cent to 20 per cent
11. An increase in the corporate income tax rate of free zones companies selling on the local market from 8 to 20 per cent
The NPP, while in opposition, criticised the NDC government for burdening Ghanaians with taxes it tagged ‘nuisance taxes’ and promised to cancel them when voted into power.
In line with this promise, the Minister of Finance, Mr Ken Ofori-Atta announced the abolishment and reduction of some taxes in the government’s maiden budget after the party won the 2016 general elections. They include:
1. Abolishment of the 1 per cent Special Import Levy;
2. Abolishment of the 17.5 per cent VAT/NHIL on financial services;
3. Abolishment of the 17.5 per cent VAT/NHIL on selected imported medicines, that are not produced locally;
4. Abolishment of the 17.5 per cent VAT/NHIL on domestic airline tickets;
5. Abolishment of the 5 per cent VAT/NHIL on Real Estate sales;
6. Abolishment of excise duty on petroleum;
7. Reduction of special petroleum tax rate from 17.5 per cent to 15 per cent;
8. Abolishment of duty on the importation of spare parts;
9. Abolishment of levies imposed on ‘kayayei’ by local authorities;
10. Abolishment of levies imposed on religious institutions by local authorities;
11. Exemption from taxation, the gains from the realization of securities listed on the Ghana Stock Exchange or publicly held securities approved by the Securities and Exchange Commission (SEC);
12. Reduction of the National Electrification Scheme Levy from five per cent to three per cent;
13. Reduction of the Public Lighting Levy from five per cent to two per cent;
14. Replacement of the 17.5 VAT/NHIL rate with a flat rate of three per cent for traders; and
15. Implementation of tax credits and other incentives for businesses that hire young graduates.
Other tax reliefs and exemptions, including the Special Petroleum Tax, were announced in the 2018 budget statement.
However, it is worth noting that the NPP government has also introduced and increased some taxes. The Luxury Vehicle Levy was introduced in 2018 but had to be withdrawn following widespread public outcry. The government also introduced an additional Personal Income Tax band of 35 per cent on monthly incomes in excess of GHc10,000 band and increased the Communication Service Tax.
CLAIM 4: Under the NPP, inflation is currently at 9.5%, as opposed to the 15.4% in 2016 (under the NDC).
MOSTLY TRUE: Inflation in 2016 was 15.4 per cent. However, in July when Dr Bawumia made the claim that inflation was ‘currently’ 9.5 per cent, data from the Ghana Statistical Service shows it was actually 9.1 per cent.
The time frame, 2009 – 2016 corresponding to when the NDC was in power will be used for the verification of this claim. We will use each year’s December inflation figure as the last inflation measured during a government’s tenure in office. Also, bearing in mind that Dr Bawumia was citing the current inflation figure when he tweeted the claim, we assume he was referring to inflation figure for the month of June as that of July had not been released. Therefore we will depend on inflation for the month of June to verify the current situation as at July 10.
Data for this fact-check was derived from the Consumer Price Index (CPI) National Time Series, March 1963 – December 2011 and the Consumer Price Index Bulletins which are produced by the Ghana Statistical Service.
According to the December 2016 Consumer Price Index Bulletin, inflation in December 2016 was 15.4 per cent.
It’s worthy of note that in 2009 when the NDC came into power, inflation was 18.1 per cent. During the party’s time in power, it fluctuated. Inflation was 16 per cent in 2009. This figure declined to 8.6 per cent in 2010 and remained the same at the end of 2011. In 2012, inflation shot up to 8.8 per cent from where it continued to rise to 13.5 per cent in 2013, 17 per cent in 2014, 17.7 per cent in 2015 and finally declined to 15.4 percent in December 2016.
Under the current NPP administration, inflation appears to be in a state of flux. Inflation fell from 15.4 per cent in 2016 to 11.8 percent in 2017 and declined further to 9.4 per cent in 2018.
In 2019, inflation started at 9 per cent, increased to 9.2 per cent in February, then to 9.3 per cent in March. Inflation for the months of April and June was 9.5 per cent and 9.1 per cent respectively.
On July 10, when Dr Bawumia made the claim, inflation for the country stood at 9.1 percent, according to the Ghana Statistical Service.
CLAIM 5: Bank lending rate in 2016 averaged 32%; bank lending rate in 2019 averaged 27%.
TRUE: The Summary of Economic and Financial Data of May 2017 and June 2019 show that bank lending rate for 2016 was 31.7 per cent and 27.68 per cent in June 2019.
The Vice President also claimed that while the average bank lending rate under his government’s administration is currently 27 per cent, it was 32 per cent during the NDC’s tenure in power. To verify this, we relied on data from the Bank of Ghana.
The Bank of Ghana’s Summary of Economic and Financial Data of May 2017 shows that the average lending rate for December 2016 was 31.7 percent.
The July 2019 edition of the report also showed that the latest average lending rate, which was measured in June this year, was 27.68 percent.
CLAIM 6: Share of DACF for persons with disabilities was 2%; share of DACF for persons with disabilities increased by 50%.
TRUE: the DACF has been increased by 50 per cent by the NPP government from the two per cent that was allocated in 2016.
Article 252(1) of the 1992 Constitution, stipulates the establishment of a District Assemblies Common Fund (DACF) to which Parliament is to make provision for the allocation of not less than five per cent (5%) of national revenues. Out this amount, people with disabilities (PWDs), are to be allotted a quota to help reduce poverty among the group.
We found that two per cent of the DACF was previously allocated to Persons. The NPP government announced a 50 per cent increment, that is, from two to three per cent, in the DACF for PWDs in its Budget Statement and Economic Policy. In conformity with this, three percent of the DACF was allocated to PWDs in 2017 District Assemblies Common Fund Formula.
