The CEO of the National Petroleum Authority (NPA), Godwin Edudzi Tamakloe, has stated that insurance costs for transport operators in Ghana have largely remained stable despite growing pressure on the sector. His comments come as the country faces intensified calls for higher public transport fares following recent fuel price increases. The NPA recently raised the price floor for petrol to GH¢16 per litre and for diesel to GH¢16.77 per litre from September 16.
Several Oil Marketing Companies have since raised their pump prices, and the Ghana Private Road Transport Union (GPRTU) has proposed a 30% increase in transport fares, citing rising operating costs. However, Mr. Tamakloe expressed concern about the potential impact of higher transport fares on consumers and inflation. He noted that the NPA and the Transport Ministry have been engaging transport operators to assess their actual cost pressures.
According to Mr. Tamakloe, there are three key areas transport operators consider when determining their operating costs: the cost of maintaining the freight, the cost of spare parts, and fuel and staff costs. He emphasized that insurance costs have not recorded significant increases during the period, while fuel costs have become a major factor. The stability of the cedi has also helped limit some operating costs, particularly for imported spare parts.
Mr. Tamakloe credited transport unions for constructive engagement, which has effectively put the proposed fare increase on hold. He acknowledged that some operators have independently increased fares, but noted that the engagements with transport operators have focused on sharing the burden rather than immediately passing the full cost on to commuters. The government has also been intervening to cushion the impact of fuel price increases.
The NPA boss pointed to the government's intervention as a factor that has helped absorb potential costs on the forex front. He stated that the issue now is to find a balance between the interests of transport operators and consumers. The GPRTU's proposed fare increase is still being reviewed through engagements with the government.
Mr. Tamakloe flagged 'recalcitrant' transport operators that have decided to increase their prices arbitrarily, despite the agreement to put the fare increase on hold. He expressed worry about the potential impact of higher transport fares on consumers and inflation. The NPA and the Transport Ministry are working to address the concerns of transport operators while minimizing the impact on consumers.
The stability of insurance costs is a significant factor in the current transport fare discussions. With fuel costs being a major factor in the operating costs of transport operators, the NPA is working to find a balance between the interests of operators and consumers. The government's intervention has helped cushion the impact of fuel price increases, but the situation remains a concern for the transport sector.
Key points
- Insurance costs for transport operators have largely remained stable despite growing pressure on the sector.
- The proposed 30% increase in transport fares is still being reviewed through engagements with the government.
- The NPA and the Transport Ministry are working to address the concerns of transport operators while minimizing the impact on consumers.
