Why Ghana Must Protect Its Heritage Funds in the Push for Transition Infrastructure

As governments around the world scramble to finance energy transition infrastructure, pressure is mounting to unlock new pools of capital. In Ghana, this debate has come into focus with recent proposals from the Ministry of Finance to expand the range of instruments eligible for investment by the Ghana Heritage Funds (GHF).  

If approved, the Heritage Funds could soon invest in assets tied to electricity access, natural gas infrastructure and energy transition initiatives. Parliament has given its approval, and the changes are now with the President for his final review. 

While the need for reliable energy infrastructure is real, the question is whether Ghana can invest these funds in transition-related infrastructure without weakening one of the country’s most important long-term public savings mechanisms, thereby costing future generations. 

Therefore, it is crucial that any decision to use petroleum savings for infrastructure must begin with strong governance measures to ensure transparency, accountability and protection against diversion into broader short-term spending.  

The Heritage Funds and the Push for Greater Investment Flexibility 

The Petroleum Holding Funds, comprising the Ghana Heritage Fund and the Ghana Stabilisation Fund, were originally created under the Petroleum Revenue Management Act (PRMA) 2011, ACT 815, to convert volatile, finite petroleum revenues into durable public value. The Stabilisation Fund was designed to cushion budget shocks during oil price downturns, while the Heritage Fund exists to preserve value for future generations in anticipation of a future beyond oil.  

At a roundtable organized by NRGI in partnership with the Public Interest and Accountability Committee earlier in 2026, the Bank of Ghana indicated that the Petroleum Holding Funds now hold approximately US$1.376 billion. This includes allocations of US$1.171billion, and about US$205 million in interest earned over a 15-year period, which the Ministry of Finance argues could have been more if investments had been made in other riskier instruments and assets.  

The modest returns generated from conservative, low‑risk investments have informed the government’s plan to amend Section 27 of the PRMA, ACT 815, to allow for more investment instruments, including foreign currency-denominated debt instruments used to finance national energy investments, including electricity-generating plants, natural gas processing, pipeline transmission, and downstream distribution systems. 

This amendment is exactly why the governance questions matter: What economic tests will be applied to ensure value for money? How will political risk and project failure be mitigated? Who will monitor performance, and under what legal authority? 

The Governance Question That Cannot Be Ignored 

The key issue is what this investment shift implies and how Ghana can introduce safeguards to protect petroleum revenues from short‑term political and fiscal pressures, especially given its historically weak record of public investment. 

Petroleum revenue projections for 2026-2029 indicate that only about US$305 million is expected to flow into the Heritage Funds over the medium term, compared to approximately US$2.37 billion into the Annual Budget Funding Amount (ABFA) — which is the primary contribution of petroleum revenue to the consolidated fund of government.1 This represents only about 13 percent of projected ABFA flows, which means that the Heritage Funds is not even large enough to be a meaningful infrastructure financing vehicle without sacrificing its core purpose.  

At the same time, the proposed amendments to the Petroleum Revenue Management (Amendment) Act, 2025 (ACT 1138) by the Ministry of Finance removed the requirement that ABFA spending follow a long-term national development plan approved by Parliament. The changes also narrow the use of ABFA funds mainly toward infrastructure spending. In other areas, the Supreme Court had clarified that at least five percent of ABFA funds should be allocated to local governments to support development. However, Act 1138 now limits this allocation to a maximum of five percent, which could reduce the funding available for local development projects. 

These changes show the government’s strong focus on quickly increasing infrastructure spending. However, concerns remain about how these projects are managed. Investigative reports submitted to the President by local media organizations in April 2026 pointed to problems such as inflated contract costs and the widespread use of sole-sourced contracts. The President has since ordered an investigation into the allegations. This highlights the risks of relying heavily on withdrawals from the Heritage Funds to finance transition infrastructure projects without robust transparency and accountability safeguards. 

The Ministry of Finance has admitted there are governance concerns and says the body managing these investments will have to meet basic governance standards, including using trusted partners and financial safeguards. Civil society groups have also asked for clear rules on how the funds will be managed, but the government has not yet published the policy document. 

Without clear safeguards, there is a risk that petroleum savings could be mixed into the general government budget, making it difficult to track how the money is spent and weakening oversight by the Public Interest and Accountability Committee (PIAC). 

Protecting the Integrity of the Heritage Funds 

Ghana’s experience with other sovereign funds offers a caution. For instance, the Minerals Income Investment Fund (MIIF), initially created to manage mineral wealth, has been swept into infrastructure spending . Losing the petroleum funds as well would leave Ghana without any credible intergenerational savings architecture, an outcome fundamentally at odds with international best practice. 

If petroleum savings are to support the transition, governance safeguards must come first. Several principles are essential: 

• Investments must remain strictly tied to transition-related infrastructure: The Heritage Funds should not become a general-purpose financing source. Its use should be limited to clearly defined transition-enabling projects linked to long-term national energy goals. 

• Investment must be ring‑fenced and traceable: Funds allocated to transition investments must remain legally distinct from the Consolidated Fund to preserve transparency. 

• Only a limited portion of accumulated savings should be exposed to higher-risk assets: Protecting the long-term integrity of the fund must remain the priority. 

• Projects must undergo transparent economic and governance assessments: Projects should meet clear criteria, backed by credible sponsors, guarantees, and independent assessment before receiving support. 

• Oversight bodies must be strengthened: PIAC, for example, must be fully funded, empowered, and equipped to monitor outcomes. 

• The Ministry of Finance must publish policy guidelines driving the implementation: This is essential because public trust depends on transparency. 

Ghana’s petroleum resources are finite. The institutions designed to manage them were designed to outlast electoral cycles and fiscal emergencies. Using the Heritage Funds to solve today’s infrastructure challenges without first strengthening governance risks, trading long‑term security for short‑term relief. 

The choice is not between saving and investing. Ghana can pursue investments in transition infrastructure while still protecting intergenerational savings, but only if strong safeguards come first and the use remains disciplined, transparent and tied to transition priorities. If Ghana is to leverage its petroleum wealth for a just energy transition, it must start by protecting the very funds created to secure that future.