According to the Minority Spokesperson on Finance, Cassiel Ato Forson, the items to be spent on, including renovation of the Flagstaff House and the Peduase Lodge, aren’t a priority as compared to other pressing needs of the country.

“I do not see the priority so clearly. We live in a country with a government that has promised so much and one would have thought that because they promised so much there would be that focus, but I am not seeing that. It is the expenditure that will give me some direction on where the country is going, but unfortunately the direction is consumption. The direction is not something that will drive the growth that we need.

“In the 2018 budget, we have been told the office of the President alone is spending 272 million Ghana cedis on goods and services , of which the office of the Chief of Staff alone is spending 172 million out of the 270 million. They are saying out of that, they are spending 100 million cedi for capital expenditure of which they are going to use part of it to renovate Peduase Lodge and Flagstaff House and some other lodges too. You will not understand it until you put it in context,” Mr. Ato Forson said.

He further indicated in a statement that “within the space of 9 months, the office of the President spent a total of about 76 million cedis on goods and services” adding that “69 million cedis of this amount was spent at the office of the Chief of Staff, and 4 million new cedis at the Vice President’s Secretariat.”

Mr. Forson believes “the immediate effect of the wasteful expenditure at the presidency is that, key growth sectors are denied resources to spur economic growth and development.”

But the Deputy Information Minister, Kojo Oppong Nkrumah in response said the Minority’s claim is misleading.

“That is not true, and often our argument is that, when these issues are raised, the devil is always in the detail. If you go to the government machinery, it has 22 different agencies under it. From the GIPC to MASLOC to all of them.The view was that the 100 million Ghana cedi CAPEX budget [and this is the view that was brought to us from the Executive here in Parliament that it] is all lumped together and it sits at the office of government machinery and the office of government machinery will then do its allocation to the 22 different agencies.

“It is not true that GHC 100 million will be used to rehabilitate Peduase Lodge. If you read the budget carefully, it says the various agencies under the office of government machinery are all going to tap into that capital expenditure budget, for their various CAPEX functions.”

Parliament rejects GH¢6m budget for Senior Minister’s office

Mr. Forson’s concerns come days after budgetary allocation for the Senior Minister’s office was rejected in Parliament.

The Minority, which the led the motion, had said the office was not a legal creation and therefore could not be allocated any funds from the national budget.

Leading the charge for the rejection was Minority Leader, Haruna Iddrisu who argued that the Senior Minister’s office is expected to coordinate the activities of other Ministries, Departments and Agencies and thus cannot be treated as a separate Ministry without legal backing.

“It is either the President has not done that which is legally appropriate because I am holding with me the Executive Instrument (EI 28) Civil Service Ministry Statement 2017, signed by Nana Addo Dankwa Akufo-Addo, the President of the Republic of Ghana which creates the various Ministries and conspicuously lost in this list, is office of the Senior Minister so it means that the portfolio of Senior Minister is only being held morally , but legally he [President Nana Addo] has no locus and if the President must do what is legally appropriate to create the office by the Executive Instrument unless a different instrument is issued to that effect,” Mr. Iddrisu argued on the floor of Parliament.

–

By: Marian Ansah/citifmonline.com/Ghana
Follow @EfeAnsah

The post GHC100m capital expenditure for presidency outrageous – Ato Forson appeared first on Citi 97.3 FM - Relevant Radio. Always.

According to the Ministry, the arguments put forward by the minority do not reflect the actual situation.

The Minority on Wednesday held a press conference where it criticized the below 6 billion cedis yield of the bond.

It argued that, the turn of events is a solid basis for the Finance Minister to be hauled before the house to explain why investment advice from institutions such as the IMF among others was ignored.

But the Finance Ministry has on a point by point basis, dismissed the assertions by the minority.

Read the full statement of the Finance Ministry below.

RESPONSE TO THE NDC’S PRESS STATEMENT ON THE ESLA BACKED ENERGY BOND

The Ministry of Finance takes notice of the Statement by the NDC Minority in Parliament making various unsubstantiated claims about the recently issued Energy Sector Levy Act (ESLA) backed energy bond. The Ministry as the ‘Sponsor’ of the GH¢10 billion Bond Programme, hereby responds to the Minority’s claims as follows:

1. Intellectual Dishonesty:

The Minority’s statement is fraught with various factual untruths which appear to be deliberately spun to allow them to reach their own preferred conclusions:

• First, the claim that the 7-year bond closed at GH¢1.5 billion is not accurate. Published information by E.S.L.A. PLC indicates that the 7-year bond was oversubscribed at GH¢2.53 billion. E.S.L.A. PLC chose to accept GH¢2.4 billion at the cut-off interest rate of 19.0%;

• Second, the claim that the 10-year bond was first closed at GHC760 million again is false. Bids received in the first week amounted to GH¢872 million and not GH¢760 million as claimed by the minority. This information is public and verifiable;

• Third, the minority claims the 10-year bond after extension closed at GH¢2.2 billion. Again false. Total bids received for the 10-year bond was GH¢2.79 billion of which E.S.L.A. PLC accepted GH¢2.29 billons at an interest rate of 19.5%.

In all E.S.L.A. PLC received Bids of GHC 5.32 billion (GH¢2.53 billion for the 7-year and GH¢2.8 billion for the 10-year), representing 89% of the targeted amount of GH¢6 billion for the first tranche under the Bond Programme.  E.S.L.A. PLC chose to accept the total amount of GH¢ 4.70 billion out of a possible GH¢5.32 billion; representing 78% of the targeted amount as this was what it preferred within its target price range of 19%-19.5%. Making a decision based on a cost/yields consideration, is prudent and not a failure. To claim that the issuance was a failure, is to be intellectually dishonest, if not mischief.

2. Justifying Assumptions

The minority again claimed that the projected consumption of petroleum products, used as a basis for projecting ESLA inflows was unrealistic. This was based on their assumption that monthly fuel consumption is equal through-out the year.

Historical data on consumption patterns however prove that this is a flawed assumption. Fuel consumption in the second half of the year is often higher as a result of increased economic activity and seasonal weather patterns.

E.S.L.A. PLC’s projected consumption of petroleum products is accurate and conservative and remains in line with historical patterns.

3. Explaining Debt Service Coverage Ratio

The Minority claim that E.S.L.A. PLC could not meet the Debt Service Coverage Ratio (DSCR) of 1.25% but rather scored 1.1% DSCR. They arrive at the 1.1% by dividing the expected inflows from the Energy Debt Recovery Levy of GH¢1.281 billion by GH¢1.158 billion in total interest payments for both the 7-year and 10-year bonds (i.e. 1.281/1.158 = 1.1)

The Minority however, did not recognize the addition of GH¢600 million GoG cash support (to be provided on demand) component, as stated in the prospectus, to the GH¢1.28 billion. They also did not add the starting cash of GH¢ 350 million in the Energy Debt Recovery Levy(EDRL) Account. It is instructive to note that the addition of the two missing components in the Minority’s assumptions, gives a total amount of approximately GH¢2.231 billion making the ratio now 1.926% (2.231/1.158). This is far greater than the required 1.25% DSCR.

The Minority either did not fully understand the assumptions underlying the structure and thus failed to do the math right or was just being plainly malicious.

4. The Subject of a Confusing Structure

The NDC claim that they found the structure of the transaction complex to understand. They further assume that because they found it complex to understand, others must also find it complex. The good thing is that the investors for whom the bond was meant understood it and that is why they patronised the bond with bids of up to GH¢5.32 billion of the targeted GH¢6 billion bid cover ratio.

Their claim that ESLA is government revenue and that an ESLA backed bond must be treated as sovereign debt is incorrect. ESLA proceeds do not commingle with the consolidated fund and thus, cannot be treated as government revenue affecting GoG fiscals.

An E.S.L.A backed bond can equally not be treated as government/sovereign debt. It is surprising that the former Finance Minister under the NDC, Hon. Seth Terkper shares this view and yet the Minority refuses to listen to him.

It is also unbelievable how the Minority would want this debt to be considered part of government debt, when in 2016, the same NDC government restructured about GH¢2 billion debt owed commercial banks under ‘the VRA Phase 1 Restructuring Program’ using ESLA proceeds as a payment source. If ‘VRA Phase 1’ and TOR debt restructuring were deemed prudent at the time by the NDC and treated as a non-sovereign transaction, why not the E.S.L.A. PLC’s Bonds? The inconsistency in the opinions of the Minority NDC is baffling.

5. Parliamentary and Constitutional Breach

The Minority in their Statement also claim that the transaction was unconstitutional as it did not have a parliamentary approval.

• First, it is curious that the Minority fails to tell us which aspects of the constitution or parliamentary standing orders or procedures that have been breached here. The mere mouthing of unconstitutionality does not create an illegality.

• Second, Parliament gave approval for this bond issuance program when it approved the 2017 Budget and Economic Policy which in paragraph 805 outlined this program. Again, in paragraph 74 of the 2017 Mid-year review the Finance Minister announced our readiness to execute this deal. Further, section 61 of the Public Financial Management ACT (which was incidentally passed during the tenure of the NDC) gives the Minister power to execute this transaction by auction. This transaction required no second layer of Parliamentary approval.

• Third, this bond is not an International financial transaction as envisaged by the constitution. Both the 7-year and 10-year bonds were domestic bonds and do not require Article 181, clause 5 approval approval unlike the Eurobonds.

6. Causing Financial Loss

Can the Minority be bold and indicate how the financial loss arises? This is missing in their statement. The mere mouthing of the claim that government could have gotten the bond issued at 2% lower does not legitimize that claim. What is the empirical basis? The minority fails to state it. This transaction by E.S.L.A. PLC causes no loss to the State.

Conclusion

The Ministry re-iterates its congratulations to all who assisted with this groundbreaking transaction and shares in the view that this was a very successful and landmark transaction; the largest corporate bond issuance in Sub-Saharan Africa.

The Ministry of Finance under this Government, will continue to pursue measures to assist in resolving the challenges in the Energy Sector that it inherited, including the over GH¢10 billion worth of legacy debts and other obligations, dumsor, unreliable and intermittent power supply, high tariffs and non-performing loans within the banking sector that is threatening to cripple the banks (due to energy sector legacy debts). We hope we can count on all Ghanaians and other stakeholders for their support and encouragement as we continue to tackle this challenges head on. 

–

By: Pius Amihere Eduku/citibusinessnews.com/Ghana

The post Statement: Finance Ministry dismisses Minority’s claims on energy bond appeared first on Citi 97.3 FM - Relevant Radio. Always.

According to the Minority spokesperson on Finance, Cassiel Ato Forson, government spent GHc87 million on administrative expenses, as well as GHc400, 000 on the printing of material for the energy bond roadshow.

His latest comment follows a press conference the Minority held on Wednesday where they alleged among others that the bond issue was a failure.

[contextly_sidebar id=”j1jr1xCyglAy9VtEEq4GhxedHsAfzNTL”]They also at the press conference accused the Akufo-Addo government of causing financial loss to the state, and requested that the Finance Minister Ken Ofori-Atta be hauled before Parliament.

Speaking with the press in Parliament today [Thursday], Ato Forson, who is also the Member of Parliament for the Ajumako-Enyan-Essiam constituency, said the expenditure amounts to reckless spending.

“From the cost that I have that the taxpayer is paying; the state is paying the arrangers, the banks, GHc87.5 million. The state is paying legal fees of GHc700, 000; the state is paying the accountant, GHc350, 000. Surprisingly, the state is paying administrative expenses of GHc80 million. Overall the state is paying GHc177 million. I think this amount is way too much.”

Mr. Ato Forson argued that, when the $1 billion Eurobond was issued under John Mahama’s administration, the amount spent was way lower than what the current administration is spending.

“This is not the first time the state is raising a bond. The last bond we raised under the Eurobond of $1 billion which translates to about GHc4.4 billion, the total cost was under 0.2 percent. Today, we are seeing a bond that we are raising for about 4 billion and the cost is about 1.77 percent.

He further said the Minister of Finance will be hauled before Parliament to give the actual breakdown of expenses for the energy bond since they suspect wrongdoing.

“I think it is important that we ask questions. So the question we are asking is that we want the Ministry of Finance to provide the state with further and better particulars. We are asking for full breakdown of what constituted the administrative expenses. Printing of the road show material was GHc400, 000. We are going to haul the Minister before Parliament, to give us full breakdown to account for every cedi that has been spent so far. We think it is way too much and we smell something fishy,” he added.

Background

Government issued a ten year and seven year bond with the aim of getting GHc6 billion to offset the legacy debts of the energy sector which was about GHc10 billion, but in all, a total of GHc4.69 billion was realized even after a seven day extension period.

The 7-year component raked in 2.4 billion cedis as targeted, at an interest rate of 19 percent.

However, the 10-year bond failed to hit the 3.6 billion cedis mark.

The Minority at a press conference on Wednesday made a litany of accusations against government, saying several wise counsel was ignored.

They also accused government of breaching the constitution because they did not seek the approval of Parliament before issuing the bond.

Minority presser on energy bond unnecessary, misleading – Kwaku Kwarteng

But a Deputy Minister of Finance, Kwaku Kwarteng, whilst speaking on the Citi Breakfast Show on Thursday, said the press conference organised by the Minority was unnecessary.

“We think that this press conference was completely unnecessary, bad taste and misinformed,” he added.

Energy bond struggled due to low interest rate – Finance Ministry

He however clarified that, government’s failure to achieve its targeted GHc10 billion lump sum after issuing the bond, was largely because investors considered the interest rate unfavourable.

Mr. Kwaku Kwarteng noted that investors were not happy with the 19% promised them, and had asked for more, but government was not willing to offer anything beyond 20%.

–

By: Godwin Akweiteh Allotey & Duke Mensah Opoku/citifmonline.com/Ghana
Follow @AlloteyGodwin

The post Gov’t blew GHc177m on ‘failed’ energy bond – Minority appeared first on Citi 97.3 FM - Relevant Radio. Always.

A Deputy Minister of Finance, Kwaku Kwarteng, made this known today [Thursday] on the Citi Breakfast Show.

He noted that investors were not happy with the 19% promised them, and had asked for more, but government was not willing to offer anything beyond 20%.

[contextly_sidebar id=”y0TZ7nHhOBcNxCVDRES2DiZ3Yu04dgZn”]Government issued a ten-year and seven-year bond with the aim of getting GHc6 billion to offset the legacy debts of the energy sector, which is about GHc10 billion.

But in all, a total of GHc4.69 billion was realized even after a seven-day extension period.

The 7-year component in the first-quarter of 2017, raked in 2.4 billion cedis as targeted, at an interest rate of 19 percent.

However, the 10-year bond failed to hit the 3.6 billion cedis mark.

There are reports that not even the explanation and appeal by government changed the minds of investors who seemingly wanted more interest on their investments.

The Minority at a press conference on Wednesday accused the government of causing financial loss to the state with the energy sector bond.

According to the minority, the below GHc 6 billion yield was a solid basis for the Finance Minister, Ken Ofori-Atta, to be hauled before the House to explain why investment advice from places such as the IMF among others were ignored.

They also accused government of breaching the constitution because it did not seek the approval of Parliament before issuing the bond.

But Kwaku Kwarteng, who is also the Member of Parliament for Obuasi West, whilst speaking to the issue on the Citi Breakfast Show on Thursday, said government pegged the interest rate for the bond at 19% because “we don’t want to overburden the economy with interest payments.”

“We gave instructions to this company [ESLA Plc] that as a matter of government policy, we do not want you to take bond beyond 20%, and so that is how they went to the market. Now on the 7 year bond, the minority is right; some of the investors invested immediately, some of them said that they have been used to buying Ghana bond at 25% or 26%, which was under the previous administration, but why is it that now you want to sell this bond and you are giving us this low, so we are not enthusiastic about it. That is the whole crux; it’s about the price on the bond.”

The Deputy Minister said they tried to convince the investors to patronize the bond telling them that “the macroeconomic fundamentals are better, we think that the things investors should consider when they are lending to a country are far better than 2015, when they were buying government bond at 25 or 26 percent, so they should patronize our bond at the price we are giving and that we don’t want to move.”

“After several engagements – people want to call it begging – we sat down and explained to people, why below 20 is a fair price to give them. Thankfully, we now got all that we want for the seven-year bond at the rate of 19%. Now the 10-year bond we are facing a similar situation. The investors are telling us that if we can even come up to 21%, we will get what we want. We believe that if they do a proper analysis of the economy in the end, they will see at a maximum the 19.5% that we are presenting now as a fair price,” he added.

We’ve not breached constitution over energy bond 

On claims that government breached the constitution for not seeking Parliamentary approval, Kwaku Kwarteng said they did no wrong.

““When you go to the bond market, you are not in a position to sit down and agree on a set of terms, take it Parliament, come back and you get those terms from the different investors. It’s not possible. We think that this press conference was completely unnecessary, bad taste and misinformed…In the eight of years of Rawlings, Mills/Mahama, they’ve never brought any bond issue to Parliament so why are they now asking why we did not take it to Parliament.? The NPP government is clear on what we are doing, we are not going to be pressured to give the kind of unhelpful and imprudent interest rates that we gave to investors. We will continue to engage and we are sure that at the end we are going to get the money that we want,” he added.

–

By: Godwin Akweiteh Allotey/citifmonline.com/Ghana
Follow @AlloteyGodwin

The post Energy bond struggled due to low interest rate – Finance Ministry appeared first on Citi 97.3 FM - Relevant Radio. Always.

Speaking to the issue on the Citi Breakfast Show on Thursday, a Deputy Minister of Finance, Kwaku Kwarteng, said because such financial instruments are strategic, parliamentary processes may delay it which could eventually affect the interest rate.

[contextly_sidebar id=”N9UNbEEfStWPLfeMN0vKVdxWYVjV14Lt”]He also argued that such bonds have not been brought to Parliament since the time of former President Jerry John Rawlings to John Mahama, hence it was unnecessary for the Minority to make such claims.

“When you go to the bond market, you are not in a position to sit down and agree on a set of terms, take it Parliament, come back and you get those terms from the different investors. It’s not possible. We think that this press conference was completely unnecessary, bad taste and misinformed…In the eight of years of Rawlings, Mills/Mahama, they’ve never brought any bond issue to Parliament so why are they now asking why we did not take it to Parliament?” he questioned.

Government issued a ten year and seven year bond with the aim of getting GHc6 billion to offset the legacy debts of the energy sector, which was about GHc10 billion.

But in all, a total of GHc4.69 billion was realized even after a seven day extension period.

The 7-year component raked in 2.4 billion cedis as targeted, at an interest rate of 19 percent.

However, the 10 year bond failed to hit the 3.6 billion cedis mark.

The Minority at a press conference on Wednesday accused the government of causing financial loss to the state with the energy sector bond.

According to them, the below GHc 6 billion yield was a solid basis for the Finance Minister, Ken Ofori-Atta, to be hauled before the House to explain why investment advice from places such as the IMF among others were ignored.

They also accused government of breaching the constitution because they did not seek the approval of Parliament before issuing the bond.

In his response, Kwaku Kwarteng explained that, the bond struggled because of the low interest rate of 19%, saying the investors wanted more, but government was not willing to go beyond 20%.

“We gave instructions to this company [ESLA Plc] that as a matter of government policy, we do not want you to take bond beyond 20%, and so that is how they went to the market. Now on the 7-year bond, the minority is right; some of the investors invested immediately, some of them said that they have been used to buying Ghana bond at 25% or 26%, which was under the previous administration, but why is that now you want to sell this bond and you are giving us this low, so we are not enthusiastic about it. That is the whole crux; it’s about the price on the bond.”

Mr. Kwarteng, who is also the Member of Parliament for the Obuasi West Constituency, said the New Patriotic Party government has a clear road-map on the bond going forward, and will not be forced to increase the interest rate.

“The NPP government is clear on what we are doing, we are not going to be pressured to give the kind of unhelpful and imprudent interest rates that we gave to investors. We will continue to engage and we are sure that at the end, we are going to get the money that we want,” he added.

–

By: Godwin Akweiteh Allotey/citifmonline.com/Ghana
Follow @AlloteyGodwin

The post Minority presser on energy bond unnecessary, misleading – Gov’t   appeared first on Citi 97.3 FM - Relevant Radio. Always.

Speaking to the issue on the Citi Breakfast Show on Thursday, a Deputy Minister of Finance, Kwaku Kwarteng, said because such financial instruments are strategic, parliamentary processes may delay it which could eventually affect the interest rate.

[contextly_sidebar id=”N9UNbEEfStWPLfeMN0vKVdxWYVjV14Lt”]He also argued that such bonds have not been brought to Parliament since the time of former President Jerry John Rawlings to John Mahama, hence it was unnecessary for the Minority to make such claims.

“When you go to the bond market, you are not in a position to sit down and agree on a set of terms, take it Parliament, come back and you get those terms from the different investors. It’s not possible. We think that this press conference was completely unnecessary, bad taste and misinformed…In the eight of years of Rawlings, Mills/Mahama, they’ve never brought any bond issue to Parliament so why are they now asking why we did not take it to Parliament?” he questioned.

Government issued a ten year and seven year bond with the aim of getting GHc6 billion to offset the legacy debts of the energy sector, which was about GHc10 billion.

But in all, a total of GHc4.69 billion was realized even after a seven day extension period.

The 7-year component raked in 2.4 billion cedis as targeted, at an interest rate of 19 percent.

However, the 10 year bond failed to hit the 3.6 billion cedis mark.

The Minority at a press conference on Wednesday accused the government of causing financial loss to the state with the energy sector bond.

According to them, the below GHc 6 billion yield was a solid basis for the Finance Minister, Ken Ofori-Atta, to be hauled before the House to explain why investment advice from places such as the IMF among others were ignored.

They also accused government of breaching the constitution because they did not seek the approval of Parliament before issuing the bond.

In his response, Kwaku Kwarteng explained that, the bond struggled because of the low interest rate of 19%, saying the investors wanted more, but government was not willing to go beyond 20%.

“We gave instructions to this company [ESLA Plc] that as a matter of government policy, we do not want you to take bond beyond 20%, and so that is how they went to the market. Now on the 7-year bond, the minority is right; some of the investors invested immediately, some of them said that they have been used to buying Ghana bond at 25% or 26%, which was under the previous administration, but why is that now you want to sell this bond and you are giving us this low, so we are not enthusiastic about it. That is the whole crux; it’s about the price on the bond.”

Mr. Kwarteng, who is also the Member of Parliament for the Obuasi West Constituency, said the New Patriotic Party government has a clear road-map on the bond going forward, and will not be forced to increase the interest rate.

“The NPP government is clear on what we are doing, we are not going to be pressured to give the kind of unhelpful and imprudent interest rates that we gave to investors. We will continue to engage and we are sure that at the end, we are going to get the money that we want,” he added.

–

By: Godwin Akweiteh Allotey/citifmonline.com/Ghana
Follow @AlloteyGodwin

The post Minority presser on energy bond unnecessary – Gov’t   appeared first on Citi 97.3 FM - Relevant Radio. Always.

The country incurred a $2.4 million loss after 30 ambulances were procured in 2014 by the Ministry of Health, but were later found to be faulty.

[contextly_sidebar id=”ddiDdqheNNg6xkKVK4Kr77ZjHKuTfebk”]With 200 ambulances originally supposed to be purchased, the government suspended the deal after the ones which had been delivered did not meet required specifications.

In a statement released on Tuesday, the Minority spokesperson on Finance stated that, the Finance Ministry at the time only “issued at sight letters of credit” on behalf of the Health Ministry after they had put in a request.

“The Ministry of Finance also instructed the Controller and Accountant General’s Department to pay for the bank charges accrued to the Bank of Ghana as a result of the issuance of letters of credit on behalf of the Ministry of Health,” the statement from Ato Forson said.

“It is important to note that letters of credit issued by the Bank of Ghana is only a guarantee for payment and not payment in itself.”

According to him,  the letter only guaranteed that payment would only be made once the supplier of the ambulances fulfilled their end of the agreement.

“In modern business practice, a letter of credit (LC) also known as a Documentary Credit, is a written commitment by a bank issued after a request by an importer (foreign buyer) that payment will be made to the beneficiary (exporter) provided that the terms and conditions stated in the LC been met, as evidenced by the presentation of specified documents,” the statement added.

” I, Cassiel Ato Forson acting as Deputy Minister of Finance then, never made payment to Big Seas for the supply of ambulances.

‘Unfit ambulances result of no inspection’

With fingers being pointed at several officials over the acquisition of the faulty ambulances, the Executive Director of the National Ambulance Service, Prof. Ahmed Zakariah, revealed that the vehicles were not inspected before the payment was made.

According to him, there should have been inspections at various levels of the production to ensure that the manufacturer was producing exactly what was required by the country when it was being procured in 2015 under the John Mahama government.

“Ordinarily, there should have been three inspection processes; one before the start of the production to enable the manufacturer to gather the specifications of government, and the second is in the course of production to ensure that the vehicles are being produced according to the given specifications, and the final one should have been after the vehicle had been produced, to confirm that all the specifications have been followed.”

Story So Far:

September 13 – EOCO to investigate purchase of 30 ambulances $2.4 million, under the Mahama administration

September 13 – Former Health Minister Alex Segbefia denies contract for ambulances was signed under his tenure

September 14 – Executive Director of the National Ambulance Service says ambulances weren’t inspected before purchase

September 18 – Cassiel Ato Forson denies sanctioning payment for faulty ambulances

Below is the full statement from Cassiel Ato Forson:

I have become aware of a series of media reportage indicating that I, Cassiel Ato Forson acting as the Deputy Finance Minister authorized payment of some defective ambulances ‘procured’ in 2014 by the ministry of health.

I want to put on record that the Ministry of Finance only acted upon an instruction from the Ministry of Health to issue at sight letters of credit on their behalf using MOH 2014 budgetary allocations.

The Ministry of Finance also instructed the Controller and Accountant General’s Department to pay for the bank charges accrued to the Bank of Ghana as a result of the issuance of letters of credit on behalf of the Ministry of Health.

It is important to note that letters of credit issued by the Bank of Ghana is only a guarantee for payment and not payment in itself.

It is only when the supplier fulfills their part of the obligation under the contract that payment will be made.

In modern business practice, a letter of credit (LC) also known as a Documentary Credit, is a written commitment by a bank issued after a request by an importer (foreign buyer) that payment will be made to the beneficiary (exporter) provided that the terms and conditions stated in the LC been met, as evidenced by the presentation of specified documents.

At Sight — A credit that the announcer bank immediately pays after inspecting the carriage documents from the seller.

Finally, I, Cassiel Ato Forson acting as Deputy Minister of Finance then NEVER made PAYMENT to BIG SEAS for the supply of ambulances.

–

By: Edwin Kwakofi/citifmonline.com/Ghana

The post I didn’t sanction payment for ‘useless’ ambulances – Ato Forson appeared first on Citi 97.3 FM - Relevant Radio. Always.

According to the report, the MoF and the CAGD failed to capture the amount in their accounts in 2016.

The omission is one of two judgement debts that did not reflect in the accounts of the Consolidated Fund. The second one is a $3.8 million judgement debt against Dunkwa Continental Goldfields Ltd (DCGL) that the country won at the International Chamber of Commerce (ICC) in August 2015.

[contextly_sidebar id=”qVGuYx5VAKZhJcMBW5ANAIjxa5wOUjlL”]The response offered by CAGD in the case of Mr Woyome’s money was that the amount had been “disclosed in the notes to the Public Accounts, since our revenue policy requires that revenue is recognised only upon receipt”.

On the ICC order, the report said: “The Ministry of Justice and Attorney-General (MoJAG) stated that the company could not be traced at their last official address. We have, however, disclosed the transaction in the notes to the Public Accounts.”

However, the 2016 Auditor-General’s Report on the Consolidated Fund stated that notwithstanding the CAGD’s explanation, the anomaly constituted weaknesses that must be addressed holistically.

It was the view of the Auditor-General that periodic monitoring and reconciliation among debtor institutions, Public Debt and Investment (PDI) and Debt Management Division, were done on an ad hoc basis and, therefore, not comprehensive to cover the state’s entire receivables.

Background

The state has been battling Mr Woyome since 2012 over the GH₵51 million paid him in a default judgement in 2010.

The Supreme Court, in a review application on July 29, 2014, ordered Mr Woyome to refund the money because the contract upon which he received the payment had not been sent to Parliament for approval, contrary to the 1992 Constitution.

In the case of the DCGL judgement debt, a tribunal constituted under the rules of the ICC in 2015 dismissed a $200-million claim filed against Ghana by two foreign-owned mining companies.

The companies, the DCGL and the Continental Construction and Mining Company Limited (CCML), filed the action against the government in 2011 but the tribunal threw out their claims for lack of merit.

It then proceeded to award $3,164,137.51 against the applicants and a further order for a refund of $700,000 to Ghana.

Both companies had accused the government of unlawfully terminating their contracts, but the tribunal held a different view after taking the submissions of the parties into consideration.

However, the tribunal upheld the state’s counter-claim for $700,000, being a World Bank loan that was lent to the two companies by the government.

According to the tribunal, the government of Ghana, acting through the then Minister of Lands, Forestry and Mines, did not breach or unlawfully terminate the project agreement relating to the Dunkwa gold mine.

Government owes SSNIT & NPRA

In the same report, the Auditor General stated that last year the Ministry of Finance failed to transfer GH¢819,880,284 of mandatory statutory funds to the Social Security and National insurance Trust (SSNIT) and the National Pensions Regulatory Authority (NPRA).

As of December 31, 2016, the MoF had failed to transfer GH₵534,849,413 to SSNIT as the contribution of public sector workers.

Similarly, GH₵285,030,871 was not transferred to the NPRA as required by law.

Section 3(b) of the National Pensions Act, 2008 states: “Out of the total contribution of eighteen and a half per centum, an employer shall, within 14 days from the end of each month, transfer the following remittances to the mandatory schemes on behalf of each worker: (a) thirteen and half per centum to the first tier mandatory basic national social security scheme; and (b) five per centum to the second tier mandatory occupational pension scheme.”

According to the Auditor-General, the government’s failure to ensure the payments meant that the government risked “paying penalties at the rate of three per cent per each month of default to the schemes as enshrined in Section 64 of the Act”.

He recommended that the MoF should ensure that the outstanding balances were transferred to the schemes immediately to avoid payment of penalties by the government and also ensure strict adherence to Section 3 of the National Pensions Act, 2008.

No excuse

In a management response, the MoF stated that the non-payment of those amounts to the NPRA and SSNIT was due to cash flow constraints.

“The MoF has made provisions for these arrears in the 2017 budget. Discussions have been initiated with the institutions to agree on a payment plan to settle the outstanding amounts,” it said.

However, the Auditor-General, from his audit position, said: “In my view, cash flow constraints cannot be used as a justification for the anomaly.”

Discrepancies in debts

Apart from the MoF’s indebtedness to the two pension-related institutions, the report revealed discrepancies in the closing balances reported by the CAGD and the confirmation received from the statutory institutions — the National Health Insurance Authority (NHIA), the Ghana Infrastructure Investment Fund (GIIF) and the Road Fund — amounting to GH¢1,306,592,288.

While in the books of the NHIA, it had GH¢544,976,790 as the government debt, the Public Accounts had GH¢793,543,687, with the difference noted as GH¢248,566,897 by the Auditor-General.

For the GIIF, GH¢2,235,146,303 was stated as the government’s obligation, but in the CAGD’s books, the government’s debt was GH¢693,190,263, with GH¢1,541,956,040 as the difference.

For the Road Fund, it stated GH¢225,573,791 as the government’s liability, but the Public Accounts had GH¢212,370,646, with GH¢13,203,145 as the difference.

According to the report, the anomaly could be attributed to the inability of the CAGD to perform periodic reconciliation with the statutory institutions to confirm their balances.

“This also led to the unexplained difference of GH¢1,306,592,288 between the liabilities reported in the Consolidated Fund Accounts and those captured by the statutory institutions,” it said.

The Auditor-General recommended that the “CAGD should liaise with the institutions to reconcile the liabilities to ensure that accurate figures are restated in the financial statements to reflect the true liability position of the government to the institutions”.

The CAGD, in response, said it was in the process of reconciling the discrepancies noted.
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Source: Graphic Online

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According to them, although they were not in office, the Controller and Accountant General still deducted ten percent from their salary arrears but was not injected into the CHPS compound projects which warranted the cut.

Speaking to Citi News’ Franklin Badu Jnr, a former Presidential Staffer, Emelia Arthur demanded a refund of the monies.

[contextly_sidebar id=”9SAVO4eRfSU75eoVi2RKqVr2dWIhw9Zh”]“It has come to our attention that since we left office some back pay that was owed us, Controller and Accountant General disbursed the ten percent, lodged it with Bank of Ghana and between controller and Bank of Ghana we don’t know where that money is. Because we were no longer in office, it is our private money and not for the state any longer.”

She explained that a team of former appointees are currently liaising with the sectors involved for the monies to be returned to them.

“That money is with them, it is our private money and we want that money back. I am not sure of the amount. But what we have done is that a team of former appointees have come together and have been liaising with the Ministry of Finance, bank of Ghana, controller and Accountant general for the 10 percent of the arrears deducted to be returned to us,” she added.

Mahama 10% pay cut missing

Ms Arthur made the claim a day after member of the Public Accounts Committee and Member of Parliament for Nhyiaeso accused the former administration of not using due process in transferring the monies worth more than two million Ghana cedis meant for the construction of some CHPS compounds.

But the former appointee insisted that the followed due process and the 10 percent pay cut was used for the purpose to which it was intended.

“At the time we were leaving office, we had built 11 and started a twelfth one. And then we started a last one in Volta Region, Ho Zongo specifically. It was at the foundation stage when we left office. And because we weren’t going to be in office for further deductions to take place, it stopped at that.”

She said out of number six were fully completed, some of which were commissioned adding that “five were nearly done, because they are usable and habitable and left with were left with only some small touches.”

Emelia Arthur explained that as at the time they were leaving office, “all we need to finish everything was about GHc124, 000 to finish the other five of the 11 except Ho that was at foundation level.”

“We followed due process. Whenever the contractor raised a certificate it would go with the necessary attached memos through the process in the office of the president as is used by all MDAs per financial laws in this country. Once we were satisfied that the certificates that had being raised were justified the accountant in the Flagstaff House would sign a cheque in the name of the contractor and it will be given to the contractor who then will pay into his account and the office of the president will alert the Bank of Ghana that such a cheque with this amount has issued to this entity and the cheque will be honoured. All these are verifiable.”

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By: Godwin Akweiteh Allotey/citifmonline.com/Ghana
Follow @AlloteyGodwin

The post Gov’t withholding our 10% salary arrears – Mahama appointees appeared first on Citi 97.3 FM - Relevant Radio. Always.

The Minority Leader says persons who worked with the Finance Minister while he was at Data Bank have been employed at the Finance Ministry.

[contextly_sidebar id=”q6HUycqSEUG9lFksfsPJfVaRKeFF4gjW”]Speaking to journalists at the NDC Headquarters, the Tamale South MP said the removal of public and civil servants must end.

“Even at the Ministry of Finance, as many as eight civil service positions have been filled by officers who hitherto were working with the Minister of Finance at Data Bank and have been out on the payroll at the Ghana Revenue Authority. We will not accept the undue politicization of the Civil and Public Service of Ghana but even that is tolerable. We will not and we will resist in all full force and infact we are calling on the development partners and donors who are concerned about our democracy and governance to call the President to order.”

Mr. Iddrisu’s claims come months after former President John Dramani Mahama criticized the governing New Patriotic Party for what he described as frequent dismissals of public sector workers.

Mr. Mahama indicated that the President set a bad precedent by dismissing these category of workers.

He had claimed that although he decided to keep the public sector workers at their various positions when he came to power , the NPP had dismissed all those workers, after taking over from them.

“When I came to power, I left most of these public sector workers but when this [NPP] government took over, they dismissed them, and this is a bad precedent for our governance because potentially government can change in every four years so if another government takes over , it means all those working in the public sector have to be dismissed for a new crop of employees to take over and this is bad for governance.”

In March, the Minority in Parliament slammed government’s approach to the removal of some heads of government institutions a few days after the Akufo-Addo administration took over.

On the floor of Parliament, the MP for Wa West, Joseph Yileh Chireh, said the recent dismissals of some top executives is most undignified and contrary to due process.

“We should not create the impression that all these people do not qualify and should be hounded out. They were given less than 24 hours to handover. People should have been allowed to properly handover. If you suspect that they have committed offences, you should not just resort to dismissals. You must make sure that the right thing is done,” the MP argued.

The Minority was also particularly very critical of President Akufo-Addo’s directive to the Administrator of the District Assemblies’ Common Fund, Kojo Fynn, to proceed on indefinite leave.

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By: Marian Ansah/citifmonline.com/Ghana
Follow @EfeAnsah

The post Ken Ofori Atta replacing MoF officials with Data Bank staff – Haruna Iddrisu appeared first on Citi 97.3 FM - Relevant Radio. Always.