Members of Parliament yesterday sounded alarm bells over a $9million loan being contracted by the governing National Democratic Congress (NDC), describing it as a “stinking” credit facility.

The Mills administration was seeking parliamentary approval for a financing agreement between the Government of Ghana and the International Fund for Agricultural Development on an amount of SDR 5,590,000, an equivalent of $9,000,000, for the Rural and Agricultural Finance Programme (RAFiP).

However, the MPs stopped the approval of the loan after realizing that the Ministry of Food and Agriculture, headed by Kwesi Ahwoi, would be using the credit facility to empower “suit and tie-wearing bank officials” at the expense of poor farmers.

The consideration of the loan generated controversy in Parliament, with members from both sides of the House registering their indignation and displeasure against the credit facility.

Members including Dan Botwe, MP for Okere; Papa Owusu-Ankomah, Sekondi; Dominic Nitiwul, Bimbilla; Edward Doe Adjaho, First Deputy Speaker, who is also the MP for Avenor/Ave; and Minority Leader, Osei Kyei-Mensah-Bonsu, expressed concern about why the government was contracting such a facility to build the capacity of ARB Apex Bank, rural and community banks and rural microfinance institutions, instead of the money going directly to the farmers.

Okere MP, Dan Botwe, urged the House to reject the loan facility, arguing it was an insult on the integrity of the House to approve such a loan to build the capacity of financial institutions when farmers were having difficulty with regard to accessing finances for their agricultural production.

“We are contracting a loan to build the capacity of people to wear more suits and ties, at the expense of the poor farmers. Why can’t the banks use their end-of-year profits to build their own capacities?” Mr Botwe questioned.

He did not understand why government would contract loans to train bank officials on how to grant credit facilities to poor farmers.

“These same rural banks are already giving loans to our illiterate farmers and petty traders with interest rates sometimes ranging from 45 to 50 percent and so why do we take loans to spend on these officials on how to do what they are already doing?” Dan Botwe quizzed.

Also kicking against the loan, Papa Owusu-Ankomah, MP for Sekondi, who is also a member of the Finance Committee of Parliament, asked, “Why do we contract money for ‘suit and tie wearing’ staff of financial institutions to be trained to facilitate the financing of ‘chalewote’ wearing farmers?” Another member of the Finance Committee, Dominic Nitiwul, who is also the MP for Bimbilla, indicated that some members had earlier spoken against the loan at the committee level and insisted it was not helpful to poor Ghanaian farmers.

Following the controversy, First Deputy Speaker Edward Doe Adjaho decided to defer the approval of the fund for the leadership of Parliament to do more consultation on the facility.

He cited an example of a similar facility that was approved in 2001 by Parliament to be used to finance a project to determine the level of poverty in the country, questioning the need for such a facility when poverty level was obvious and easy to determine.