The Food and Beverages Association of Ghana (FABAG) is calling for an immediate reversal of the latest utility tariff hikes.

It warns that any attempt to force through the new rates without fixing long-standing structural failures will deepen the country’s economic distress.

In a statement issued on December 8, the association rejected the Public Utilities Regulatory Commission’s move to raise electricity tariffs by 9.8 per cent and water tariffs by 15.9 per cent, insisting the decision is “unacceptable, unjustifiable, and insensitive.”

FABAG said the increases cannot be justified when the Electricity Company of Ghana has still not explained “in clear and measurable terms” how it intends to cure what the association describes as a “cancer of inefficiency, financial waste, and mismanagement.”

It said the Public Accounts Committee has already exposed the extent of ECG’s failures and questioned why the PURC is “sweeping this cancer under the carpet.”

The group said ECG “has become the very disease it was created to cure.”

According to the association, the institution, which should power national growth, now drains productivity and trust from “every corner of the economy.”

The statement pointed to deep inefficiencies, persistent losses, corruption, poor worker attitudes, revenue shortfalls and poor service delivery as the real causes of the sector’s decline. It argued that instead of fixing these problems, the PURC continues to punish consumers with new tariffs.

FABAG said businesses cannot continue to pay for what it described as the incompetence and corruption within ECG and the Ghana Water Company.

It raised concerns about the wide gap between public sector wage increases and the tariff jumps, calling it “unacceptable that government increases workers’ pay by 9% and goes ahead to increase utilities by 25.7%.”

The association highlighted ECG’s budget overrun of GH¢189.2 million without approval and demanded a clear framework that identifies those responsible.

FABAG also wants full disclosure on procurement processes, questioning why spending grew from under GH¢1 billion to over GH¢8.3 billion in 2023. It pointed to ECG’s technical and commercial losses, which it said now exceed 30 per cent, making the company “among the worst in Africa.”

FABAG said it is unaware of any credible plan to reduce these losses.

The association warned that businesses are already under severe pressure and risk shutting down, cutting jobs or raising prices. It said the tariff increase will worsen food inflation because the sector relies heavily on power and water for production, storage and distribution.

It lamented the absence of accountability mechanisms that would force the utilities to reduce theft or improve customer service. FABAG stressed that consumers should not be paying for inefficiency, especially when ECG has “repeatedly refused to publish transparent operational audits.”

It warned that the inevitable rise in product prices will worsen the cost-of-living crisis and destabilise an industry that contributes significantly to jobs and revenue.

FABAG said tariff-led solutions cannot fix the problem. It argued that “Ghana cannot tax or tariff-increase its way out of a broken power and water sectors,” adding that the real solution lies in restructuring, digitisation, accountability and better revenue management.

It insisted that until the inefficiencies are cured, tariff adjustments remain illegitimate and unacceptable.

The Association is demanding an immediate suspension of the tariff increase, a full operational audit of ECG and the Ghana Water Company with public disclosure, a credible loss-reduction programme, enforcement against internal theft and illegal connections, and a cost-recovery model driven by efficiency rather than continuous tariff hikes.

FABAG said it will continue to defend the interests of its members and the public, insisting that Ghana deserves utility systems that work and not ones that survive by punishing consumers.