Notwithstanding the initial economic strides made by the NRC, it soon faced enormous problems which plunged the country into an economic crisis.
1975 proved to be a critical turning point, and by 1977, the economic problems had become overwhelming. The credit extended to the state by banks had skyrocketed from C17 million in 1973 to C781 million in 1977. Production had decreased and there were shortages of essential commodities and the activities of smugglers soared.
Though the courts were ready and willing to assist to arrest the situation, only a tip of the iceberg reached them; and in punishing these persons heavily, the courts ridiculed themselves as the worst culprits got away. For example, in 1977, the Circuit Court at Denu presided over by one J.B.K. Yemidi, jailed a 69 year old woman to two years, six months for smuggling 4 gallons of kerosene to the Republic of Togo.
In May 1978, an Accra Circuit Court jailed Gladys Ayetive – 26, four years for selling Palmolive soap at C4.00 instead of 87 pesewas and one packet of Omo at C4.00 instead of 46 pesewas. Korkor Addo – 22, was also jailed four years by the same court for selling two tins of mackerel at C1.40 each instead of 37 pesewas. The punishment would have gladdened the hearts of Ghanaians if the big-time smugglers and corrupt officials were also arrested and brought before court to receive sentences to fit their crimes, but this was not the case because of the links they had with officialdom. According to the official figures released at the end of 1978, the country lost £50 million through the smuggling of local goods to neighbouring countries.
As a way of solving the problem, the government adopted the ’Chit’ system. The adoption of the ’Chit’ system as a way of rationing the supply of the existing stock of essential commodities even worsened the situation because a few managed to collect large consignments of goods only to sell them at exorbitant prices to the already impoverished masses. Hoarding and profiteering as a means of survival reached such heights that a term – kalabule was coined to denote economic malpractices. Corruption was everywhere as it seemed to enjoy official blessing.
Even General Acheampong, the Head of State, was neck deep in the rape of the economy. With the stroke of his famous green ink (pen), he ordered Principal Secretaries of the Ministries of Trade and Finance in particular to issue import licenses to his favourites – usually young girl friends and mistresses, without reference to the Bank of Ghana for advice. One of such letters read:
His Excellency the Head of State and Commissioner for Finance recommends that Import License worth C1,152,000 for the importation of one (1) Ford Cortina Estate Car and six (6) Model 3022 T Forestmill portable sawmills be issued to Madam Alice Adae Garbrah of Post Office Box 86, Tepa. Ashanti, for the establishment of a rural industry at Tepa.
Through official connections import licenses worth millions of cedis were issued to people sympathetic to the NRC and girl friends of members of the government. Many of the state enterprises became the meeting grounds between army officers, corrupt management and private merchants.
Out of humour, Ghanaians coined the term “bottom power” to describe the success with which certain young women (their ’business acumen’ being the gift of nature -beauty), were able to gain possession of ‘Chits’. What outraged Ghanaians was that the beneficiaries were not even the hard working market mammies, but just ’small girls’ fresh out of school or university. The new symbol of economic power became the VW Golf rather than the traditional mammy wagon. Many businessmen resorted to under-invoicing which led to the loss of huge sums of revenue (in the form of customs duty) to the state.
Further evidence of official involvement in corruption was that, between October 1977 and August 1978, the CMB ordered C2.7 million worth of spare parts for Peugeot cars and one Bedford truck without proper documents on them. A cheque for C211,000.00 for Peugeot vehicle parts was also paid to Kojo Bruce Trading Company and C312,000.00 to another company, but invoices were never traced.
In June 1978, under the guise of export promotion, $667,000 worth of timber products were exported to Saudi Arabia without any Letters of Credit established on them. Again, the Timber Marketing Board failed to inform the Bank of Ghana of an amount of $467,000 being part payment realised from the export of timber products to Saudi Arabia, but instead, the amount was paid into the accounts of the Board in London. Members of the ruling council also allocated large sums of money to themselves despite the ailing economy. For example, they received a ‘special allowance’ of C9,000.00 every six months. This meant a member of government of the rank of Colonel received a tax free allowance of C18,000.00 per annum besides other bonuses.
This amount at the time was about three times the annual net salary of a Colonel in the Ghana Army. From March to April 1977, the Consumer Price Index jumped from 964.5 to 1,128.7 per cent because of the skyrocketing cost of locally produced food.
Workers were unable to afford their staple food made from corn and cassava. Those with enough money bought yellow corn even though they expressed shame at eating what was normally used for animal feed. Perhaps one would appreciate the extent to which things had gone bad by looking at these price levels in 1978. A carton of fish sold by the State Fishing Corporation for C80.00 was re-sold on the open market at C240.00, meat attracted between C12.00 to C18.00 per pound though it should have cost C4.00. Tinned tomatoes which cost 65 pesewas in 1971 sold at C6.00. Other prices were a tin of Milo at C20.00 from C2.00, a tin of milk from 17 pesewas to C3.00.
The prices of cotton fabrics and enamel wares also saw phenomenal increases. Under the kalabule empire, a seven-piece set of enamel ware which cost C90.00 at the official retail price now sold at C350.00. A half piece ‘Akosombo’ wax print which sold at C24.00 and the ‘Tenia’ type which cost C16.00 had by 1977 risen to C200.00 and C150.00 respectively. Imported Guaranteed Dutch wax print was unaffordable for most Ghanaians as the prevailing price of C400.00 per half-piece was more than the take-home pay of many senior officials (the minimum wage was C4.00 a day).
In response to these hardships of the workers in the public sector, strikes became common. Most of the strikes, as expected, centred around calls for improved working conditions. On the whole, the number of strikes increased from a total of 8 (in 1974) to 11 (in 1976) 10 (in 1977) and 23 (in 1978). The most serious of these were the Ghana Registered Nurses Association (nationwide) 25 days strike (in 1978), and the Ghana Oil Refinery 11 days strike (in 1978). The educational sector was also seriously affected as teachers in both first and second cycle schools left the country to seek greener pastures, especially in Nigeria.
The universities were not spared either as a number of the academic staff also joined the ‘adventure’ to escape the unbearable economic situation. The consequences of this trend on the country’s manpower development could well be imagined. Industries had their turn of the negative developments when the lack of raw materials forced many of them to either close down or produce below capacity, most often at about 25.0 per cent capacity. In an attempt to break even at this ridiculously low production level, most of the industries laid off some staff. The effects on the individual, his family and the society in general were alarming.
General Acheampong refused to accept sound professional advice on economic and fiscal policies and tried to solve the mounting economic problems by printing more money to off-set the rising budget deficit which stood at C154.9 million in 1974 and over C781 million in 1977. The excess liquidity caused inflation to rise from 24.7 per cent in 1974 to 116.4 per cent in 1977.
According to the Bank of Ghana, between 1976 and 1978 in particular, the expansion of money appeared to be intractable as the level rose by C2,008.4 million or 165.7% to C3,220.7 million at the end of 1978. The budget deficit also rose from C154.9 million in 1974 to C1,141.6 million by the 1978/79 fiscal year and it so continued to rise that the national consumer price index rose at an average rate of 75.7% between 1977 and 1980.
By July 1979 the country’s ability to service her short-term loan repayment had declined to the extent that it had fallen into arrears to the tune of C1,190 million. Consequently, further credit lines were blocked. The effect was the stagnation of the economy and decline in the standard of living of the majority of the people.
In the face of heightening tension and disaffection among Ghanaians over Acheampong’s mismanagement which had brought suffering to a majority of the people, he stepped further on the nerves of Ghanaians by mooting the idea of a “Union Government” – a non-partisan system of Government composed of the military, the police and civilians.
Apparently, Acheampong had the mind of perpetuating himself in office by still occupying the seat of Head of State through this political arrangement. To push through his plans, he formally outdoored on January 10, 1977, an Ad-Hoc Committee on Union Government with Dr. Koranteng-Addow, Attorney-General and Commissioner for Justice as its chairman to collect and collate ideas on Union Government to ensure its effective implementation.
Mr. Joe Appiah was appointed Commissioner and Special Adviser to the Head of State in addition to his prior designation of “Roving Ambassador” in a bid to boost the campaign for Unigov. He was sent far and near to propagate the concept. “Special Aides” of Acheampong – including S.K. Danso, Sam Boateng, S. O. Lamptey, Ben Kumah and Kwasi Ghapson toured the entire country with official backing and sponsorship, selling Unigov and Acheampong to the people. With matches, shirts, handkerchiefs and other items with Acheampong’s picture printed on them and with inscriptions such as “General Acheampong, Ghana’s man of Destiny,” “Vote Unigov, Vote Acheampong”, Commissioners and members of the SMC abandoned their official duties and tirelessly trekked the length and the breadth of the country in official cars and Air Force helicopters to campaign for Unigov.
Even traditional rulers did not miss the opportunity to campaign for Unigov. For instance, Nana Amoakwa Boadu VII, Omanhene of Breman-Asikumah told his people at a durbar to round off the Odwira Festival in November 1976 that, Unigov would enhance the first principle of the National Charter of Redemption – One People, One Nation, One Destiny.
The state media was at its sycophantic best. For, an editorial of the Daily Graphic on Friday, 21 October, 1977 – six clear months before the referendum on Unigov stated among others that, the SMC has the right to decide what it thinks is good for Ghana’s future because its existence is legal and moreover, a majority of Ghanaians have rejected party politics. The SMC defied advice, intimidated and victimised people who opposed the Union Government idea, for example G.W. Amartefio – “Mr. No” was detained for attacking the Unigov concept in a GTV debate.
A referendum was held on 30 March 1978 to determine the wishes of the people on this issue. In the course of the release of results, the Electoral Commissioner, Justice I. K. Abban gave up his assignment due to threats on his life for failing to falsify the results. He resurfaced from his hideout on April 3,1978 and reported himself to the Castle in the company of His Grace John Kodwo Amissah, Archbishop of Cape Coast, Rev. Hilary Senoo of the Catholic Secretariat and Rev. C. Awotwe Pratt of the Methodist Church. He was relieved of his post. A.M. Quaye was appointed as the Acting Electoral Commissioner.
After the officially declared majority of less than 50% (43.0%) of the registered persons who voted in favour of the Union Government idea, (registered voters were 4,614,767 and 23.5% (23.6%) and 19.8% (18.9%) were supposed to have voted ‘YES’ and ‘NO’ respectively), Ghanaians began to sense that the results were falsified and this worsened the already tense political atmosphere.
Referendum Results, presented by the same A. M. Quaye, the Acting Electoral Commissioner confirmed the suspicion on the falsification of the results. The total number of votes cast rose from 1,983,678 (as per the first results) to 2,282, 813 (as per the second results). This clearly indicated that the figures have been adjusted to cover up the fraud. Again, the total number of registered voters as published by Mr. Justice Abban before the Referendum and which was quoted by the Acting Electoral Commissioner in the confirmed results to General I. K. Acheampong on April 3, 1978 was 4,614,767,803 in the Gazette results.
Clearly, this was an attempt to adjust upwards, the total percentage of people who voted which stood at 43.0 percent to a respectable figure of 50.8% (51.0%) percent and therefore cover the fact that majority of registered voters (probably as a result of their indignation towards this political development) had boycotted the Unigov Referendum.
In the face of this development, the government appointed a Constitutional Commission, composed of people from different backgrounds, to draw up proposals on what was referred to as a ‘National Government’, to be composed of civilians (politicians), some members of the Armed Forces and the police.
Though, a modification of the original plan of Union Government, people became more incensed, and, despite the intimidation and detention of people through the Preventive Detention Decree, civil disobedience became widespread. Professional bodies like the Ghana Bar Association withdrew their services temporarily – April to July 1978. The Christian Council, the Catholic Secretariat and some traditional rulers openly criticized the dictatorial tendencies of the government. Many of the most eminent public figures teamed up in the Association of Recognised Professional Bodies – ARPB, the Front for the Prevention of Dictatorship – FPD and the People’s Movement for Freedom and Justice – PMFJ to oppose the Union Government proposals.
For instance, at its inaugural press conference held on January 27, 1978 the PMFJ rejected the proposal for a Union Government type of political system and, in a ten-point statement read on behalf of the leaders by Lt. Gen. A. A. Afrifa, explained that Union Government would be at variance with human rights. The ARPB also adopted a resolution on 30 March, 1978 calling on Acheampong and the SMC to resign and hand over power to the Chief Justice, Justice F. K. Apaloo, who, acting as the Head of State should, in consultation with the Council of State, appoint an interim government to administer the affairs of the state and set in motion a machinery to return Ghana to civilian rule by 31 December, 1978.
Demonstrations by university students became frequent. Really, the country at this time became unsettled. To prevent the escalation of the confusion and to put national life back to normalcy, the army staged a “palace coup” d’etat on July 5, 1978 and removed Acheampong from office. His place was taken by Lt.-Gen. (later General) Frederick William Kwasi Akuffo, who had been Acheampong’s deputy and Commander of the Ghana Armed Forces. According to Akuffo the action was taken “in the interest of the unity and stability of the nation”.
Watch out for part nine: General Akuffo and the SMC II.