Out of the amount, he said, GH¢1.4 billion was used as liquidity support for the failed banks in 2016 prior to their collapse in August, this year, while “the government now intends to issue a bond of GH¢2 billion to pay the GCB Bank for the difference in the valuation of the selected assets and liabilities taken over.”

GCB Bank was chosen among three interested banks to take over select assets and liabilities of UT and Capital banks through a purchase and assumption (P&A) agreement signed between the largely state-owned lender and the central bank.

“This GH¢3.4 billion is to be borne by the taxpayer and it is three times the budget of the Free SHS programme for the first year. Yet neither the Minister of Finance nor the BoG Governor is telling us about it,” Mr Adongo said at a public lecture in Accra.

The lecture was organised by pro-NDC group, Coalition for Restoration (CRF), to offer speakers an opportunity to analyse the 2017/18 budgets in the contest of moving from taxation to production. It was on the theme: ‘Analysis and expectation of the 2017/18 budgets to drive the change from taxation to production.’

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Govt’s silence

On August 14, BoG revoked the licences of UT and Capital banks following their heavy deficiency in capital and liquidity.

Following the revocation, the central bank approved a P&A agreement with GCB Bank to assume ownership of the deposits and select assets of the now defunct banks.

The action was in conformity with the Banks and Specialised Deposits taking Institutions Act, 2016 (Act 930), which was passed last year to help define a mechanism that the central bank could fall on to protect deposits whenever banks go through distress circumstances.

Mr Adongo said although the government and the BoG Governor, Dr Ernest Addison, cited non-conformity to good corporate governance and recklessness by management and board of directors as the cause of the collapse, all of them had remained silent on how much it was costing the state.

That, he indicated, was not good for transparency purposes.

“When the governor met his colleagues at the Chartered Institute of Bankers at a dinner, he failed to tell them how much the tax payer is paying to clean up the mess of those who collapsed the banks.”

“The taxpayer has already paid GH¢1.4 billion to clean up the mess of the directors and there is a further GH¢2 billion that has been set aside in the 2018 budget to clean up the mess this year. In total, it is costing us GH¢3.4 billion to clean up this mess

“Now, imagine that we are only spending GH¢1 billion on free SHS, do you not agree with me that the GH¢3.4 could have given all children in Ghana access to free education and still leave some change?” he asked.

Need for transparency

He also criticised the central bank for abandoning its role as an independent regulator to dabble into “propaganda,” citing the governor’s recent pronouncements on the cedi depreciation and debt stocks as bases.

“Recently when he met with the Chartered Institute of Bankers at their dinner, he said the cedi depreciated against the US dollar by 4.6 per cent since the beginning of the year compared to the same period average of about 17 per cent depreciation over the last three years. But I thought that if you are bold enough to mention 4.6 per cent for October, then why go to average? Also go to October 2016 and you will see that we did a depreciation of 4.3 per cent, better than the 4.6 per cent,” he said.

That notwithstanding, stated that, BoG data showed “the cedi appreciated in value against the British pound by 13 per cent in October, compared to a depreciation of 11.2 per cent in October this year. Against the euro, we did a negative depreciation of 4.2 per cent and they did 14.7 per cent negative depreciation.

“So, how can you now, as a governor, hide the true state of affairs?” he asked.