OSP vs Former NPA Bosses: Katanomics Exposed as Bigger Culprit in Ghana UPPF Scandal

By rewriting expert analysis from Bright Simons on Ghana’s fuel pricing controversies, this guide breaks down the OSP’s NPA prosecution, the Unified Petroleum Pricing Fund (UPPF), and why flawed policies like Katanomics fuel corruption.

Introduction

The Office of the Special Prosecutor (OSP) in Ghana is actively prosecuting former senior executives of the National Petroleum Authority (NPA), a key regulator in the country’s downstream petroleum sector. Allegations center on an extortion scheme linked to the Unified Petroleum Pricing Fund (UPPF), reportedly generating over $25 million in illicit gains. Recent debates have focused on nearly $10 million in frozen assets, including luxury vehicles, gas stations, and properties, tied to the former NPA CEO.

While individual accountability is crucial, analyst Bright Simons argues that “Katanomics”—a term describing how poor policy design evades public scrutiny amid political distractions—represents the deeper systemic failure in Ghana’s uniform petroleum pricing system. This article demystifies the UPPF mechanics, NPA corruption claims, and sustainable fixes for equitable fuel pricing across Ghana’s 672 km span from Cape Three Points to Pusiga.

Analysis

What is the UPPF and How Does Uniform Petroleum Pricing Work in Ghana?

The UPPF, established under the National Petroleum Authority Act (Act 691), pools levies from petroleum products sold at pumps nationwide. Collected by Oil Marketing Companies (OMCs) like GOIL, TotalEnergies, and Puma, these funds—recently GHS 0.36 to 0.47 per liter, or 10-21% of total taxes/levies—are managed by the NPA to subsidize freight costs. The goal: ensure uniform pump prices within each brand chain, regardless of distance from import ports in Tema and Takoradi.

Prior to the 1990s deregulation, Ghana lacked such uniformity. Today, alongside the Primary Distribution Margin (PDM), UPPF aims to prevent geography from inflating prices in northern regions like Bolgatanga compared to coastal Sekondi.

Transparency Gaps in UPPF Management

Despite generating GHS 1.5 billion in 2023 and over GHS 4 billion in 2024 (exceeding GHS 2 billion annually now), the NPA has not publicly disclosed detailed collections, distributions to transporters, or administrative costs since 2005. Funds have reportedly diverted to NPA building contractors (over $100 million in some years), security services fuel, and possibly municipal spending—violating Act 691’s strict mandate for freight equalization, infrastructure, and administration only.

Does UPPF Truly Achieve Price Uniformity?

Uniformity applies only within brands: Shell prices in Accra match those in Wa, but differ from Puma or GOIL. In 2024 pricing windows, inter-brand spreads reached GHS 1 per liter for petrol and more for diesel, driven by brand competition, not logistics alone. Urban areas offer choices; remote spots like Bongo or Nzema East face limited options, where perceived quality trumps price.

Katanomics: Policy Blind Spots Fueling Abuse

Katanomics describes Ghana’s trap where political noise overshadows policy flaws, eroding citizen oversight. Disjointed policies like UPPF invite waste, as seen in the Pwalugu Dam case. Without “critical citizen constituencies” for policy, shady schemes proliferate under benevolent guises.

Logistics Realities and Alternatives

Ghana’s logistics amplify distance effects, but water transport via Volta Lake (Akosombo to Buipe) costs ~GHS 0.04 per liter vs. GHS 0.45 by road—10x cheaper at scale. Historical peaks moved 70 million liters seasonally in 2009, but issues like low water, maintenance, and disputes dropped utilization below 55% by 2014, spiking road reliance and hidden costs (5-60 pesewas per liter in surges).

Equity Concerns in Fuel Price Equalization

Northern poverty aligns with distance, but southern districts like Krachi East, Ada East, and Nzema East suffer similar deprivation with sparse outlets. A targeted matrix of poverty, density, and freight pass-through would better direct subsidies than crude distance-based UPPF.

Summary

The OSP’s pursuit of former NPA bosses highlights UPPF-linked corruption, but Katanomics—unscrutinized policies breeding abuse—undermines Ghana’s uniform petroleum pricing. Opaque funds, inter-brand price gaps, and untapped logistics like lake transport reveal inefficiencies. True reform demands transparency, engineering-focused solutions, and policy politicization.

Key Points

Practical Advice

To address Ghana’s fuel pricing challenges:

1. Implement Transparency Dashboards: Publish real-time UPPF inflows, outflows, and transporter payments for public verification.
2. Prioritize Infrastructure: Invest UPPF in Volta Lake dredging, Buipe-Bolgatanga extensions, and mega-depots to cut logistics costs.
3. Open-Source Freight Data: Share maps and zonal pricing bands to aid OMCs, banks, and entrants.
4. Auction Subsidies: Allocate aid competitively based on benchmarks, targeting high-poverty, low-density areas.
5. Promote Multimodal Logistics: Emulate FMCG firms’ hub-and-spoke models for stable pricing without opaque funds.
6. Build Citizen Oversight: Form policy-focused groups to monitor NPA beyond elections.

These steps could reduce ex-pump logistics surcharges from GHS 0.20-0.70 per liter without UPPF reliance.

Points of Caution

• Avoid assuming UPPF alone ensures equity; brand competition and quality perceptions dominate consumer choices.
• Remote areas’ monopolies persist despite funds—subsidies don’t guarantee competitive entry without land auctions.
• Downtime in alternatives like lake transport (e.g., 2018 low-water shift added 15-35 pesewas/liter) risks volatility if not fixed.
• High administrative opacity invites corruption; demand audits before expansions.
• Katanomics thrives on apathy—citizens must prioritize policy over politics.

Comparison

UPPF vs. Private Sector Logistics

UPPF reinvents solved problems; private methods achieve uniformity without consumer surcharges.

UPPF Yield vs. Potential Savings

GHS 4B+ annual UPPF vs. GHS 0.20-0.70/liter savings via water transport—funds could bootstrap reforms instead of sustaining opacity.

Legal Implications

The OSP prosecution invokes Ghana’s anti-corruption framework, including the Office of the Special Prosecutor Act, 2017 (Act 959), targeting abuse of public office. UPPF mismanagement breaches National Petroleum Authority Act, 2016 (Act 919) and Petroleum Revenue Management Act provisions on fund use. Act 691 explicitly restricts UPPF to freight equalization and related infrastructure—diversions to contractors or security constitute misappropriation, prosecutable under criminal laws. Frozen assets under investigation underscore asset forfeiture risks for implicated parties. Verdicts could set precedents for regulator accountability in Ghana’s petroleum sector.

Conclusion

While the OSP must hold former NPA executives accountable for alleged UPPF corruption, jailing individuals treats symptoms, not Katanomics’ disease. Ghana’s uniform petroleum pricing demands engineering over slogans: transparent accounting, lake logistics revival, targeted subsidies, and vigilant citizens. By politicizing policy, Ghana can dismantle waste, ensure equitable fuel access, and liberate GHS billions for development. The path is clear—will leaders and citizens seize it?

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