Ghanaians will reject any form of restrictive tendering – Crusaders Against Corruption charges
An anti-corruption group, Crusaders Against Corruption has waded into the restrictive tendering argument stressing that Ghanaians will reject any form of restrictive tendering in selecting a private partner to manage the power sector in the country.
Crusaders believe that, regardless of the time constraint, the interest of Ghanaians should override everything.
The group is insisting on transparency and accountability as Ghana begins the process of replacing Power Distribution Service (PDS).
The call comes on the back of a letter from the Finance Ministry indicating PDS concession has been terminated but recommended the selection of new private managers be done through restricted tendering to meet the Compact Two deadline.
In a statement signed by Chief Crusader of Crusaders Against Corruption, Emmanuel Wilson Jnr, expressed appreciation that the government had heeded to the earlier demands of terminating the PDS concession but was quick to add that it would not relent on the remaining demands.
One of the demands made by the group include “Ensuring that all funds that were withdrawn from ECG’s cash flow or borrowed on behalf of ECG is analyzed forensically. ”
It is also demanding the sight of the MiDA Board Minutes over the past year to ensure that all funds that were withdrawn from ECG’s cash flow or borrowed on behalf of ECG are analyzed forensically.
It argues that “the members of the board were placed there on trust for the good people of Ghana, not for their own enrichment and self-interests.”
In addition, “it wants that in replacing PDS, immediate plans must be instituted to open up the ownership of this new concession to all Ghanaians, and not limit it to just a handful of individuals and companies per Article 36 (6), which states that “the State shall afford equality of economic opportunity to all citizens.”
Background regarding termination agreement
Government announced that it has terminated the controversial PDS concession agreement. The basis for the termination of the contract was presented in a nine-page letter.
In the letter dated 18th October 2019, the Finance Minister explained that the PDS demand guarantees submitted to the ECG were not backed by a ‘Valid Payment Security’, justifying its decision to terminate the transaction agreement with the entity.
The express denial of the existence of the Demand Guarantees submitted by PDS to ECG and the declaration by Al Koot of its intention not to be bound by any present or future legal obligations arising thereunder, amply shows that the Transaction was never backed by a valid Payment Security.
The transfer to PDS thus never became effective. Due process will thus justify a termination of the Transaction Agreements in accordance with Articles 2.6 and 5.1- a declaration of the non-occurrence of Transfer and consequently termination, or termination pursuant to Article 3.4 – failure of Company Event of Default in light of the provision in Article 3.2.
The provision by PDS of invalid and unenforceable Demand Guarantees, as contended by AlKoot, necessitated scrutiny by the Government of Ghana of the processes leading to the impugned act by PDS.
Investigations revealed that the local shareholders of PDS funded US$11.5 million of the US$12.5million payments it made to procure the demand guarantees using funds taken from operating accounts.
The actual details of the purported insurance cover for the Transaction furnished by PDS disclose further gross deception and unprofessional conduct on the part of PDS” the letter stated.
Other reasons cited for the termination of the contract, according to the letter, indicated that PDS deceptively produced ‘A-rated insurance company, AlKoot as their primary insurer when in actual fact, they offered the insurance obligation to a ‘number of unknown and obscure insurance firms’ around the world.
Whereas AlKoot was produced by PDS as the primary insurer, the reality of the scheme deployed by PDS in the procurement of the invalid Demand Guarantees suggests that Al Koot was only put forward by PDS as a “front” with the actual obligation retroceded to a number of unknown and obscure insurance firms from unfamiliar jurisdictions around the world.
This at best betrayed a trivialization of or a lack of appreciation by PDS of the seriousness of the Transaction in which about three (3) billion United States Dollars (US$3bn) of the assets of Ghana was at stake” the statement revealed.
It also added, “the records will also show that by a letter dated 5 July 2019, PDS forwarded to MIDA Payment Securities purportedly notarized in Qatar and stamped in Ghana for onward presentation to ECG. The Payment Securities were purportedly sealed and signed by a Naharb Bin Rashid Al Nuaimy (Lawyer and legal consultant).”
These series of deceptions by the Power Distribution Company, according to government, have led to the termination of the position of the company as a power distributor and revenue collector on behalf of the ECG, and by extension the Government of Ghana.
Find below the press release from Crusaders Against Corruption group
