The Ministry of Works and Housing has said it will consider leveraging the pensions fund to promote mortgage arrangements in the country.
There is a provision in the Pensions Act which requires that part of the funds be applied to real estate development.
It is against this backdrop that the sector minister, Samuel Atta Akyea, says his outfit is currently working on a legislation to demand about 30% from the pension pool to improve the housing deficit in the country.
“What we need is a mortgage system which is connected with the income level of the mortgagor; we need to understand that most of our workers are on the pension scheme; what is that money used for?” he asked.
Mr Atta Akyea added: “Why don’t we have this pool of money interfere with legislation and say we rein fence 30% of every coin that drops into the pension fund?”
According to the Minister, these monies can be given to some selected banks or government may set up a mortgage desk to facilitate payment of the said funds to real estate developers.
Mr Atta Akyea said he is also working in collaboration with the Finance Minister to include this plan in the 2019 budget.
“We are very anxious to see something quickly this time around in terms of the legal regime and the approvals with the Ministry of Finance; this pre-budget presentation, it is something very uppermost in the minds of the Minister for Works and Housing and the Minister of Finance,” he said.
According to the Minister, the construction industry has become a host of many. As a result, there’s the need for a legal framework to sanction members who are not doing the right thing. He has therefore impressed on the industry to put in an official request for a law to protect the sector.
“I’ll have to invite you; let’s think through a strong legal regime so that you’ll be able to deal with wayward members of this association.” He said.
Local content legislation
The Minister says there is the need to tie foreign investors to a legal arrangement so that Ghanaian contractors can have an urge with regards to local content participation.
Meanwhile, the Minister bemoans some contracts are very sophisticated such that they require foreign hands to work on.
He, therefore, says there’s the need for a law, which is set apart from the local content law on Oil and Gas and Mining, which encompasses every profession of consequence.
A Lecturer at the seminar, Professor George Ofori, told JoyBusiness one of the challenges the construction sector faces is the lack of continuity, delays in payment of contractors.
In his response to the Minister’s commitment to local content participation, Prof Ofori says, “It shouldn’t just be local content for local content sake; it should be meaningful and I hope this discussion of local content is one that is not pushed by emotion but a consideration of both the economic argument as well as the business opportunities.”
The speaker says pride should not drive local contractors to take up a task they cannot accomplish.
He said foreign expertise still has a role to play.
The maiden annual construction industry lecture was on the topic, “Ghana’s construction industry, yesterday, today and tomorrow; towards greater professionalism.”