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TUC expresses grave concern over lack of engagement on govt’s debt exchange programme

Secretary of the TUC, Dr. Yaw Baah in a statement said “We are equally concerned about the lack of prior engagement with Labour given that a substantial portion of worker’s pension is invested in government bonds.”

The TUC’s reaction followed the government’s move to rely on a softer payment plan with institutions and individuals who have lent money to the country as part of efforts to reduce the burden the public debt stock puts on the economy.

The plan, which is in line with the government’s commitment to restore macroeconomic stability in the shortest possible time, involves the swapping of existing domestic bonds with longer-dated bonds that will take between four and 14 years to mature in 2037.

Minister of Finance Ken Ofori-Atta announcing the programme said Ghana is facing a very challenging economic situation amid an increasingly difficult global economic environment, marked by the COVID-19 pandemic, the global economic shock created by the Russian invasion of Ukraine, and disruptions of global supply chains.

He said for the government to alleviate the debt burden in the most transparent, efficient, and expedited manner, treatment of domestic debt is necessary adding that the invitation does not entail any reduction in the principal amount (haircut) of the eligible bonds which involves an exchange for a new government of Ghana bonds with a 0% coupon in 2023 that steps up to 5% in 2024, and 10% from 2025 onwards.

“The TUC will scrupulously analyze the propriety or otherwise of the participation of pension funds of its members in the programme.

“We are assuring workers, that the TUC and its Affiliate Unions will do everything in our power to ensure that our members are fully protected and that not even a pesewa of pension funds is lost in the Debt Restructuring Programme.

“We are, therefore, appealing to all workers and unions to remain calm as we work to protect our retirement funds.”

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