MPs’ Car Loan vrs. MPs’ Duty Post Vehicles: Which One will Cost the tax payer More?

It is now confirmed that Parliament has approved the much talked about $28 million loan for purchase of vehicles for Members of Parliament. It must however be pointed out that the Finance Committee of Parliament has recommended that the $28 million loan should mark the last time government would facilitate a loan for purchase of Vehicles for MPs. So all things being equal, in the next Parliament, starting 2025, there will be no loan for MPs to purchase vehicles.

It must also be emphasized that before the loan was approved yesterday, North Tongu MP, Samuel Okudzeto Ablakwa, and Okaikwei Central MP, Patrick Yaw Boamah, had sponsored a private members’ motion for Parliament to reject the $28 million dollar loan. The two young enterprising legislators received enviable commendations from a section of the public for listening to their cry. Though Hons Ablakwa and Boamah did not have their wish granted, they may, loosely, claim victory based on the fact that in the next Parliament, there will be no roundly bastardized ‘monster’ called car loan for MPs. At least their wish has been deferred to a latter date.

What those who celebrated Hons Ablakwa and Boamah, and the Finance Committee’s decision to terminate the approval of the car loan for MPs, perhaps do not know is that, what has been proposed in placed of the car loan will cost the State more than the current arrangement. What I have realized is that most people criticizing the car loan for MPs have not apprised themselves of the terms of the arrangement between the MPs, the State and the Bank. If they do, they would have opted for the car loan for MPs as less costly venture for the State than the proposal of duty post vehicle for MPs.

For most of the people who gnashed their teeth in raged over the car loan, the State was going to cough out $28 million dollars to buy V8s for MPs. This was how many people understood the issue, and without asking further questions, they joined the bandwagon to lambast the MPs. Truth is, each of the 275 MPs, under the car loan arrangement, would pay 40% of the loan while the State deals with the reminder. The 40% is paid through deductions from their salaries. My understanding is that deduction for the 8th Parliament started even before the facility was approved yesterday.

Under this arrangement, the MPs will fuel their own V8, pay their own drivers, do their own maintenance and bear any risk in respect of the use of the Car. The State has nothing to do with these. The only cost to the State is the 60% payment and the waiver of duty.

In place of this, what Hons Ablakwa and Boamah and a section of the public have prevailed on the Finance Committee to do is to recommend that MPs and Members of Council of State should all be treated like other article 71 office holders. What this means is that the State must provide duty post vehicles for all 275 MPs. Beyond this, the State must fuel the V8s of all 275 MPs for four years, pay their drivers for four years, take charge of the maintenance of the V8s for four years, and any other benefits that Ministers, deputy Ministers, and Judges etc are entitled to.

One thing we must know is that, there is an established practiced in Ghana that when a minister uses his deputy post vehicle for some number of years, he is entitled to purchase it at lesser cost when he is existing office. This is also likely to be extended to the MPs. Assuming the agreement is that, after every four years, MPs are entitled to purchase their duty post vehicles. What it then means is that if half of the 275 MPs decide to purchase their official vehicles, then the State would have to look for money to buy new vehicles.

Starting from 2025, the State would have to look for money, and it will obviously be loan at cutthroat exchange rate, to buy 275 V8s for MPs, engage 275 drivers for MPs and pay them monthly, fuel the car for four years and cater for it’s maintainance. Clearly, the car loan regime was less costly to the State than duty post vehicles for MPs.

For now demanding equal treatment as their colleague article 71 office holders which will cost the State more, we cannot fault our MPs. We as Ghanaians and the two MPs who ought to have explained issues relating to the loan to the public, are to be blamed for castigating the MPs to opt for an option that will be more burdensome to the tax payer. On this issue, the public acted on emotions other than looking at the substance of the issue at stake.

What I thought Hons Ablakwa and Boamah should have advocated for, which the Committee should have recommended to the plenary for approval was that, car loans should be approved for only first timer MPs. The current arrangement must be looked at again.

Amos Blessing Amorse
Deputy Greater Accra Regional Youth organizer-NDC
citizenkorsi@gmail.com

By: Joseph Nana Yaw Cobbina