Each of the 10 board members of the Bank of Ghana (BoG) received GH¢510,000 in allowances last two years, as reported in the central bank’s 2022 audited annual report and financial statement.
This occurred despite the board presiding over a GH¢60 billion unprecedented loss.
According to the report, “fees and allowances paid to non-executive directors during the year amounted to GH¢5.10 million.”
In the year when the central bank recorded its worst performance in recent history, each board member received an average of GH¢42,500 monthly, totaling GHC510,000 annually—a 60.9% increase compared to 2021.
In addition to the governor and his two deputies, these 10 board members constitute the governing board of the bank, as mandated by the Bank of Ghana Act, 2002 (Act 612).
The Board is entrusted with formulating policies critical to achieving the bank’s objectives and provides strategic direction on its operations.
It convenes at least once every two months to deliberate on matters within its statutory responsibilities and those referred to it.
But who were these board members?
The Bank of Ghana (BoG) released its full-year 2022 audited financial statements on July 28, 2023, which drew widespread criticism due to the substantial loss reported.
According to the financial statements, the bank recorded a total loss of GH¢60 billion.
This figure has unfortunately been subject to politicization, with GH¢53.1 billion of the losses attributed directly to the government’s domestic debt restructuring exercises (phase 1 and II), as clarified by the BoG.
In terms of compensation, Ghana’s non-executive directors at the central bank receive some of the highest emoluments on the continent.
On average, they are compensated more favorably than their counterparts in South Africa, Botswana, Mauritius, and Rwanda.
Annual emoluments received by non-executive board members in Ghana, South Africa, Mauritius, Botswana, and Rwanda in 2022 exemplify this trend.
In Kenya, Uganda, and Zambia, where the compensations of executive directors are combined with those of non-executive directors, Ghana’s figures remain competitive. However, Nigeria and Sierra Leone compensate their central bank directors at significantly higher rates.
The Fourth Estate converted the GH¢5.1 million received by the BoG’s non-executive board members into U.S. dollars for seamless comparison with other African countries. Using the average exchange rate of ¢8.9191 per dollar in 2022, they facilitated a clear understanding of these comparisons.
Before 2020, the BoG’s annual reports typically consolidated the emoluments of non-executive and executive directors, making it challenging to ascertain the specific amounts paid to non-executive directors.
However, the 2020 annual report disclosed that the board of directors received GH¢1.96 million in 2019. Since then, the emoluments of non-executive directors have steadily increased. By 2020, their fees and allowances had risen by GH¢670,000, and during the COVID-19 pandemic in 2021, these figures escalated from GH¢2.63 million to GH¢3.17 million.
By 2022, amid significant losses incurred by the bank, these emoluments surged to GH¢5.10 million. Concurrently, the BoG’s top management, including the Governor, his deputies, and senior executives, received GH¢16.79 million in short-term employee benefits. This marked a nearly quadruple increase from the GH¢4.49 million recorded in 2017.
During this period of rising fees and allowances, particularly in 2021, Finance Minister Ken Ofori-Atta urged Ghanaians to bear the burden and collaborate to revive the economy.
In April 2022, the government implemented a 30% salary reduction for all its top appointees as part of austerity measures to address the country’s financial challenges.
Additionally, stringent measures were imposed, including restrictions on foreign travel except for essential statutory purposes, a 50% decrease in expenditures related to meetings and conferences, and a halving of fuel coupon allocations.
“We have decided also to continue with the policy of a 30 % cut in the salaries of political office holders including the President, Vice President, Ministers, Deputy Ministers, MMDCEs, and SOE appointees in 2023,” he said.
During his October address on the state of the economy, President Nana Akufo-Addo reiterated this policy, stating, “We have also decided to maintain a 30% salary cut for political office holders, including the President, Vice President, Ministers, Deputy Ministers, MMDCEs, and SOE appointees in 2023.”
Members of the Council of State also voluntarily agreed to reduce their monthly allowances by 20% until the year’s end in response to the country’s economic challenges.
However, it seems that these austerity measures did not extend to the central bank.
The Bank of Ghana has faced intense scrutiny since revealing its significant financial loss. Since August 2023, the Minority in Parliament has demanded the resignation of Governor Dr. Ernest Addison and his two deputies, blaming them for what they call financial mismanagement.
“We are resolved to embark on popular action to occupy the Central Bank and drive out the team of inept, callous, and criminal mis-managers of the finances of this country and save the Bank of Ghana. The March to Ensure Accountability will begin in 21 days if the Governor of the Bank of Ghana does not do the needful and pack bag and baggage out of that sacred institution that he has so desecrated. Dr Ernest Addison Must Go! There has to be an end to impunity and it is now,” the Minority Leader, Dr Cassiel Ato Forson, said.
When the Governor and his deputies refused to resign, the Minority staged a demonstration. However, Dr. Addison reportedly informed Central Banking, an international business website, that he had no plans to resign. He characterized the Minority’s protests as “completely unnecessary.”
“The Minority in Parliament has numerous channels in civilized societies to voice their grievances, not through street demonstrations like hooligans,” Dr. Addison remarked.
Nevertheless, Bright Simons, Honorary Vice President of IMANI Africa, described the scale of the chaos caused by Ghana’s central bank managers as “the scope of the mess” created by the managers of Ghana’s apex bank as “eye-popping from a historical point of view.”