Government has commited an amount of 400Million Ghana cedis to cover up the deficit that the utility companies will suffer as a result of the 25% reduction from tariff increments by the Public Utility and Regulatory Committee (PURC).

The decision was as a result of a consensus reached between Government and the PURC that the former would absorb 25% of the tariff increment on behalf of consumers.

Speaking to Joy News, Deputy Information and Media Relations Minister, Felix Kwakye Fosu noted that government was still "strained" financially but will take up the cost nonetheless.

According to Mr. Kwakye Fosu, the 400Million Ghana cedis committed by government was an estimated amount arrived at during discussions on the issue.

"We estimate that between now and the next adjustment that will be announced, an amount of 400Million Ghana cedis will be required to make up for the shortfalls that the utility companies will otherwise suffer", the Deputy Minister intimated.

The 25% tariff absorbed by government therefore means that consumers will now pay 59.18 percent as against the 78.9 per cent announced by the PURC regarding electricity tariff.

He further asserted that since the PURC is an independent body and had already developed the tariff increment as law, it could not be reversed but for government to take up the cost involved.

"The PURC has already gazetted the increase. In other words it has become law. And seeing that the PURC is an independent body and cannot subject to the directive of government, government has offered to absorb 25% of the recently announced tariff adjustments. it will cover the period for which the recent adjustments apply. PURC has the mandate to revise the tariffs that were paid as and when they deem it necessary based on the representation made to them by the utility companies", The Deputy Minister noted.

He therefore pointed out that the decision arrived at by government was the best for Ghanaians as the 400 Million Ghana cedis would be paid as and when the utility companies require it.

Meanwhile, the Electricity Company of Ghana (ECG) is preparing to allow the new tariff adjustment to reflect on the metering system and power payment bills of consumers.

The decision of Government was to appease organized labour, who threatened a nation-wide strike by November 18 after the PURC made public its up-ward tariff adjustments.

General Secretary of the Trades Union Congress (TUC), Kofi Asamoah has noted that members of organized labour are satisfied with government's decision but will push further for a reduction in water tariffs.

"We would have loved to have a reduction more than the 25% that was agreed by government. We are going to lift our attention to that of water to find out what it means and what exactly should be done to in terms of the reduction of that tariff  as well", he emphasized.

The ECG has been responding to government’s directive and is reprogramming its systems to reflect the changes. Public Relations Officer at the ECG, William Boateng, submitted that customers would have their accounts credited to reflect the change.

"We are meeting stakeholders this morning. We would definitely carry the directives of government by reducing tariffs by 25%. So what we are doing this morning is to work out something with our engineers, especially, on the software re-programming so  that customers on the pre-paid would be able to get back their credit because we have already charged them PURC tariff since 26 October", Mr. Boateng indicated.

According to him, consumers would be credited on their account, which would be handled on their next payment schedule and then be prepared into a bill and submit to government for payment.

In another development, the Kumasi District Council of Labour expressed dissatisfaction with the 25 percent reduction in electricity tariff.

Chairman of the Kumasi District Council of Labour, Kofi Asare Asianowa, told Luv News that the decision of organized labour would be respected, though he had expected a better negotiation.

"We cannot say we are completely satisfied. If you really listen to the Secretary General of the TUC and for that matter who speaks on behalf of organized labour. They had to look at a win-win situation for government and the ordinary Ghanaian. I will only encourage and admonish all Ghanaians to accept it. Let us move forward and we are calling on government and utility companies and heads of institutions for effective management. We don't want the situation where if there is a need to beef up the system, we just get back at the ordinary person, when government owes these utility organizations", Mr. Asare Asianowa observed,

Meanwhile, sections of the public in Accra, interviewed by Joy News, have expressed skepticisms about the viability of the new tariff. While some say it is a political talk, others were of the view that they would adopt a-wait-and-see attitude.