The US Embassy in Ghana has dismissed a request by the Minority in parliament for a separate probe into issues of alleged fraud in the PDS-ECG concession arrangement, according to a report by ABC News Ghana.
The Minority in a letter signed by its leader, Haruna Iddrisu, and submitted to the Embassy on Wednesday by its Ranking Member on Foreign Affairs Committee Okudzeto Ablakwa, demanded a separate probe by the US embassy into the PDS-ECG concession deal on the basis that they(the minority) do not trust the government to carry out a fair investigation.
However, this request has been shot down by the Embassy who are of the strong conviction that the Government of Ghana is in a position to conduct an independent probe into the matter and amicably resolve the challenges that has confronted the concession agreement in a transparent manner.
The US Embassy in its response said “The U.S. Government strongly supports the decision taken by the Millennium Development Authority (MiDA) Board of Directors to authorize and hire an independent investigator to conduct a forensic audit of the claimed material breaches in order to fully establish the facts of the matter. Only then can all relevant parties make a transparent and evidence-based decision that is in the best interest of the citizens of Ghana”.
It went on to establish that, “the United States’ interest is in a transparent, well-run transaction that meets international standards for private sector participation, investment, and operations. The U.S. Government expects that MiDA, PDS, and the Government of Ghana will continue to work together to implement the bold solutions and partnership of the MCC compact that have been fostered to enhance the reliability of the country’s power network and improve the lives of millions of Ghanaians.”
Government took a decision to suspend the concession agreement after it found evidence of alleged fraud perpetrated by the private entity, PDS.
Investigations have been commenced by government in earnest with separate delegations meeting with the Qatar based reinsurance company Al Koot and the US government to delve deeper into the matter at hand.
Despite the suspension, both parties, ECG and PDS have arrived at a consensus on a temporal management structure to ensure smooth operations and continuous delivery of service to the customer.
PDS under the concession arrangement was to make the business of power distribution in the country more efficient.
Find below the details of the US Embassy response stating their position.
U.S. Embassy Response:
The Millennium Challenge Corporation (MCC) Ghana Power Compact was signed in 2014 and is a $498 million investment in the transformation of the country’s energy sector through private sector participation and key policy and institutional reforms that will provide more reliable and affordable power to the Ghanaian people. The MCC Ghana Power Compact is expected to benefit an estimated 9.7 million Ghanaians over the next 20 years.
The 20-year concession of the Electric Company of Ghana Ltd (ECG) to private operator Power Distribution Services Ghana Ltd (PDS) aims to improve the operations, maintenance, and service to the millions of customers within Ghana’s southern distribution network. The concession does not shift the ownership of ECG’s distribution network to PDS or any other entity. The distribution network remains the property of the Government of Ghana, and under the financial structure of the concession, at all times, Ghanaian investors will hold a minimum of 51% of the ownership interests in PDS.
On July 30, 2019, the Government of Ghana, through the Ministry of Information, announced the suspension of the 20-year concession, citing alleged “material breaches” of its agreement with PDS. We believe, and our partners in the Government of Ghana agree, that private sector participation is essential to restoring the financial health of Ghana’s energy sector.
The U.S. Government strongly supports the decision taken by the Millennium Development Authority (MiDA) Board of Directors to authorize and hire an independent investigator to conduct a forensic audit of the claimed material breaches in order to fully establish the facts of the matter. Only then can all relevant parties make a transparent and evidence-based decision that is in the best interest of the citizens of Ghana.
The United States’ interest is in a transparent, well-run transaction that meets international standards for private sector participation, investment, and operations. The U.S. Government expects that MiDA, PDS, and the Government of Ghana will continue to work together to implement the bold solutions and partnership of the MCC compact that have been fostered to enhance the reliability of the country’s power network and improve the lives of millions of Ghanaians.