IMF Splits Labour, Govt

As the dose of bitter policy prescriptions outlined by the International Monetary Fund (IMF) continues to bite, pitching government against Ghanaians, especially workers, eight labour unions are threatening to shut down the country through an indefinite strike action.

These bitter policy prescriptions, emanating from a three-year bailout package signed in April 2015, have put President Mahama’s second-term ambitions in a tight corner ahead of the November presidential and parliamentary polls.

When the deal was signed last year, the IMF noted that one of the risks posed to its programme with Ghana has got to do with the run-up to the 2016 elections, which may lead to social tensions and a strong push for policy reversal.

Less than a year after signing onto the programme, the fear expressed by the IMF has started to manifest already. 

President Mahama, who declared that he has a "dead-goat syndrome" to demonstrate that he would not be hoodwinked by demonstrations by workers, faces his first major test today as Organised Labour hits streets countrywide.

The threat by the eight unions to declare indefinite strike if their demonstrations today do not result in reduction of utility tariffs and total reversal of price increases of petroleum products could shut down key sectors of the economy, with far-reaching implications.

Justice delivery, education, healthcare delivery, industrial production and most services will be shut down if Organised Labour declares an indefinite strike. 

Already, the Tertiary Education Workers Union (TEWU) is on strike over issues regarding Single Spine migration, and other workers’ unions have served notice of demonstrations and strikes to press home their demands.  

Ghana is faced with a sovereign debt crisis, rising interest costs, rising corruption, policy slippages and external shocks, which have dampened the country’s medium-term prospects, and the sacrifices the IMF wants Ghana to make have put Mahama’s chances in this year’s elections in danger.

Ghanaians are crying over increases in prices of utilities, as well as what they refer to as new "killer taxes" introduced by the government.

In December last year, the Public Utility Regulatory Commission (PURC) announced a 59.2% hike in electricity and 67.2% in water.

There was also the introduction of the Energy Sector Levy on petroleum products, which has shot up the prices of petroleum products to as much as 28% despite continuous fall in the price of crude oil on the world market.

There have also been the introduction of the income tax and other related taxes, all of which have increased the cost of living for many Ghanaian workers.

Despite the huge public outcry, the IMF wants government to continue with such policies to restore the economy.

Members of the Trades Union Congress (TUC), Ghana Federation of Labour (GFL), Ghana National Association of Teachers (GNAT), Industrial and Commercial Workers’ Union (ICU), National Association of Graduate Teachers (NAGRAT), Ghana Medical Association (GMA), Judicial Service Staff Association of Ghana (JUSAG), and the Coalition of Concerned Teachers (CCT), who are members of Organised Labour, will shut down vital sectors of the economy if a strike is declared.

Should government give in to the demands of the workers, revenue targets will be missed, which would negatively impact on the IMF bailout programme.

Dead Goat Syndrome faces test

In March 2015, President John Mahama told the Ghanaian population in Botswana, where he was on a three-day official state visit, that he has become impervious to threats of strikes and demonstrations in Ghana and would not yield to any of such threats.

Adopting what he calls a "dead-goat syndrome," the President said he would not be hoodwinked by such strategies by workers.

The President said demonstrations are part of strategies by workers' groups to tie the hands of government, especially in election years.

And when government yields to such threats, the economy and budget are thrown out of gear, only for the government to start tightening its belt after elections.

That will not be allowed in 2016, he promised.