Background

The Presidential (Transition) Act, 2012 (Act 845) provides in section 14(1) as follows:

‘On the assumption of office of the person elected as President a person holding any of the offices specified in the Schedule shall cease to hold that office, and shall be paid the relevant retirement benefits and the enjoyment of facilities as provided by law.’

The Schedule to Act 845 provides the following categories of persons to which section 14(1) applies

Persons holding office under the Presidential Office Act, 1993 (Act 463)Ministers and Deputy Ministers of StateRegional and Deputy Regional Ministers of StateSpecial Assistants, Special Aides to the President to the Vice President and to the Ministers of State, Deputy Ministers, Regional Ministers and Deputy Regional MinistersNon-career ambassadors and High CommissionersPersons appointed by the President or a Minister of State as members of Statutory Boards and Corporations

On January 11, 2017, the Secretary to the President wrote a letter dismissing the Chief Executive Officer of Ghana Cocoa Board.  The letter provided that

‘Pursuant to Section 14(1) of the Presidential (Transition) Act, 2012 (Act 845) and paragraph 6 of the schedule thereto, you ceased to hold office as Chief Executive of Ghana Cocoa Board upon the assumption of office of His Excellency, the President of the Republic’.

On January 20, 2017, a similar letter was sent to the Chief Executive Officer of the Volta River Authority –

‘Pursuant to Section 14(1) of the Presidential (Transition) Act, 2012 (Act 845) and paragraph 6 of the schedule thereto, you ceased to hold office as Chief Executive of the Volta River Authority upon the assumption of office of His Excellency, the President of the Republic’.

Issues Arising

It is important to note that

Nowhere in Section 14 of the Presidential (Transition) Act does it state that Chief Executive Officers (CEOs) of Government agencies cease to hold office as CEO on the assumption of office of the elected President;Nowhere in Paragraph 6 of the Schedule in question does it state that CEOs of state agencies or companies cease to hold office as CEO on the assumption of office of the elected President;Section 14(1) refers to a Schedule which provides that the following cease to hold office on the assumption of office of the elected President –Presidential StaffersMinisters

iii. Deputy Ministers

Regional MinistersNon-career Ambassadors and High CommissionersSpecial Assistants & Special Aides (to the President, the Vice President, Ministers of State, Deputy Ministers, Regional Ministers and Deputy Regional Ministers

vii. Persons appointed by the President or a Minister of State as members of Statutory Boards and Corporations

The issue arises whether it is acceptable to interpret ‘Persons appointed by the President or a Minister of State as members of Statutory Boards and Corporations’ to mean that CEOs cease to hold office as soon as the elected President assumes office?  I do not think so!

Statutory Boards & Corporations

There are a number of Boards of Statutory Corporations in Ghana.  Under Section 46 of the Interpretation Act, 2009 (Act 792), a ‘Statutory Corporation’ is defined as ‘a corporation established by or under an Act of Parliament’.  Each Statutory Corporation therefore has a piece of legislation or Act of Parliament that ushers it into force and provides the basic rules for its governance.

This means that Schedule Paragraph 6 of Act 845 does not cover Government agencies that are set up as Limited Liability Companies, for example Ghana Airport Company Limited, Ghana Water Company Limited, PSC Tema Shipyard Company Limited, Tema Oil Refinery Limited and Ghana National Gas Company Limited.

It further means that Schedule Paragraph 6 of Act 845 does not cover constitutional bodies set up under the 1992 Constitution, for example the Audit Service Board, Statistical Service Board, Lands Commission, Police Council, Prisons Council and the Judicial Council.  As to whether a case should be made that some of these Constitutional bodies whose governing rules have been further detailed by Acts of Parliament should be affected be the January 7th dissolution provisions of Act 845, may be the topic for another day.

I humbly submit that Section 14 and Schedule Paragraph 6 of Act 845 simply mean that on the date on which the elected President assumes office, the Boards of Statutory Corporations (i.e. the Boards of Corporations that are set up by or under an Act of Parliament) are automatically dissolved.

Alternative Arguments

Some have argued that the dissolution provisions apply only to Government Nominees on Boards of Statutory Corporations.

Note that some Boards of Statutory Corporations have institutional representatives as part of its membership.  Almost all Boards of Statutory Corporations have nominees of the President or a Minister of State as part of its membership.  These persons are usually referred to as Government Appointees or Government Nominees on the statutory board.

For example the board of the Ghana Ports & Harbours Authority (GPHA) is composed as follows:

the Chairmanthe Director-General of the Authoritytwo Directors of the Ports of Tema and Takoradione representative of the Ministry of Transport …representatives of port users, nominated bythe Shippers’ Councilthe Chamber of Commercethe Private Shipping Companiesthe Managing Director of the Railways Corporationtwo other persons, one of whom is an employee of the Authority

This means the Chairman, and two other persons, one of whom must be an employee of GPHA are Government Nominees. The representative of the Ministry of Transport may also be deemed to be a Government Nominee since he is a nominee of the Minister for Transport.

There are Institutional Representatives from the Shippers Council, Chamber of Commerce, Private Shipping Companies and the Railways Corporation (now Ghana Railways Company). There are also the Directors of the Tema and Takoradi Ports.

The Director or CEO of GPHA is also a member of the Board by virtue of being the CEO of GPHA.  In other words, whoever is the CEO of GPHA at any point in time becomes an automatic board member.

It has been argued, therefore, that under Act 845, those who cease to hold office upon the swearing in of the new President are only those nominated by the President or Minister of State.  In this case, these would be the Chairman, the two other Government Appointees, and the representative of the Minister of Transport.

Indeed, it may be ‘safer’ to accept this interpretation as it would mean that at least some of the Boards of Statutory Corporations would have institutional representatives left on the board after dissolution on January 7th who can carry on the work of the board as an ‘interim board’, provided they form the necessary quorum.  For example on the GHPA Board, applying this interpretation would mean that seven out of the eleven members of the board would still be at post to ensure that the work of the GPHA continues:

Director-General of GHAPOHA (in this case, whoever has been appointed)two Directors of the Ports of Tema and Takoradithe representatives ofthe Shippers’ Councilthe Chamber of Commercethe Private Shipping Companiesthe Ghana Railway Company

It should, however, be noted that most of the legislation governing the composition of Boards of Statutory Corporations, provide that the President shall ‘appoint’ the members of the board (i.e., both Government Nominees and Institutional Representatives) in consultation with the Council of State.

This means that whether or not the person in question is nominated by the Government or by the relevant institution, it is the President (or sometimes Minister of State of the sector depending on the wording of the legislation) who does the ‘appointing’.  This is the prescribed procedure and usually has nothing to do with the preliminary nominations.

I would therefore still stand by the interpretation that allows for total dissolution of the Boards of Statutory Corporation upon assumption of office of the newly elected President.

To prevent a situation where work of the Boards is literally at a standstill, the new Government must move quickly to populate the Boards starting with the ‘urgent’ ones.

Chief Executive Officer

A Chief Executive Officer (CEO) of a statutory corporation is usually a member of the board of the corporation.  Dissolution of the Board does not necessarily mean that the CEO must leave post as CEO, because he is a member of the Board by virtue of the fact that he/she is CEO and not vice versa.  He/she is therefore CEO until removed as CEO and he/she cannot be removed as CEO under Section 14(1) and Schedule Paragraph 6 of Act 845.  If a new board is appointed, the CEO becomes a member of the new board unless he is removed as CEO.

Indeed, I humbly submit that the termination of the appointment of CEOs of Statutory Corporations falls under Section 14(3) of the Presidential (Transition) Act, 2012 (Act 845), which states that

‘A public officer whose office is not specified in the Schedule, continues to hold office on the assumption of office by the person elected President subject to the provisions of the Constitution and of the relevant law applicable to that public officer’.

Anyone who seeks to terminate the appointment of a CEO of a Statutory Corporation must be guided by the provisions of the 1992 Constitution, and the relevant law that applies to the particular CEO, including his/her Conditions of Service.

Interpretation of Paragraph 6 of the Schedule

I have read various sections of the Presidential (Transition) Act 2012 (Act 845) over and over again because it is important to be cautious when dealing with what seems to be a ‘glaring mistake’.

I have learnt that to be a step ahead of others, you must presume that whoever you are dealing with is smarter than you or at least just as smart as you.  This means when you see a ‘glaring mistake’, do not rush to criticize … take your time … do not presume negativity … test different angles to see if the mystery will be unraveled.

I have tried interpreting Paragraph 6 of the Schedule in various ways:

‘Persons appointed by the President or a Minister of State as members of Statutory Boards and Corporations’

Various categories would be:

Persons appointed by the President as members of a Statutory Board;Persons appointed by a Minister of State as members of a Statutory Board;Persons appointed by the President as members of a Statutory Corporation;Persons appointed by a Minister of State as members of a Statutory Corporation.

I have considered the following categories as well:

Persons appointed by the President as members of Corporations;Persons appointed by a Minister of State as members of Corporations.

However, any reasonably good draftsperson who sought to include ‘corporations’ to ensure that it was not qualified by ‘statutory’ would have reversed the positions of ‘statutory boards’ and ‘corporations’ in the draft.

I have pondered … by stretching it widely … could the draftsperson of the letter have been reading ‘members of a corporation’ to mean ‘members of a company’ under the Companies Act, 1963 (Act 179)?  Section 30 of the Companies Act, 1963 (Act 179) provides inter alia that the Subscribers to the Regulations of a company shall be deemed to be members of the company.

Act 179 further provides that every other person who agrees with the company to become a member of the company and whose name is entered in the register of members shall be a member of the company.  In the case of a company with shares, each member shall be a shareholder of the company and shall hold at least one share and every holder of a share shall be a member of the company.

I have, however, been unable to reconcile such a position with the law, since it is largely accepted that incorporated companies are registered under the provisions of the Companies Act, 1963 (Act 179) but Statutory Corporations are established under the Statutory Corporations Act, 1964 (Act 232).

Conclusion

My conclusion is that Section 14(1) & Schedule Paragraph 6 of Act 845 refer to persons appointed by the President or Minister of State as members of boards of statutory corporations.

With due respect to the framers of Act 845, it may have been advisable for the Schedule Paragraph 6 to read

‘Persons appointed by the President or a Minister of State as members of Boards of Statutory Corporations’.

Instead of

‘Persons appointed by the President or a Minister of State as members of Statutory Boards and Corporations’.

If the framers intended CEOs to be included, there could have been a clause (Paragraph 7) covering ‘all Chief Executive Officers of Statutory Corporations’.  I have no doubt, however, that the framers knew they would be treading on shaky ground by adding such a provision, for the simple reason that the conditions of CEOs of state corporations vary from institution to institution.  Some of these CEOS even go through interviews at the Public Service Commission before they are appointed as substantive CEOs with applicable Conditions of Service. It should also be noted that not all state agencies are statutory corporations.

Recommendation

It is important to note that the thrust of this article is NOT that the newly elected President cannot terminate the appointment of CEOs of Statutory Corporations or Government agencies, BUT that he should ensure careful research into the legality of processes applied in these terminations – each one must be treated on its own merits.

It may be the case that the newly elected President needs persons experienced in governance to guide him on the procedural aspects of these grave decisions and to draft appropriate letters on his behalf.

May I humbly recommend that there are some very experienced and competent Civil Servants in the system, who may be sought out to guide these processes without any political sway being brought to bear on same.

The interesting thing about ‘high-level political governance’ is its tendency to ‘catch one off-guard’.  You may be the greatest lawyer on earth, but you will find that your knowledge of the law does not suffice in certain situations.  This may be due to the incredible weight of Government business and its associated stress level.  You may find that you do not have time to ‘breathe’.  It is important to seek the advice of others and look at precedents in the system.

… Just when you think you have one matter under control, another one comes hard at you … if you cannot duck with the speed of lightening, it smashes you in the face.  So as you duck at the sight of missiles, and as you jump over the landmines, you have to read avidly, analyze astutely and think deeply about the correctness of your decisions and the basis thereof.

You need to be as fast as lightening … you must be a born or trained multi-tasker … and, needless to say, you cannot do it without the Grace of God!????

By: Valerie Sawyerr, Former Senior Policy Advisor & Head of the Presidential Delivery Unit

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