Contracts made 400% juicier

BY: Enimil Ashon
Vice-President, Dr Mahamudu Bawumia
Vice-President, Dr Mahamudu Bawumia

Why will a state enterprise buy and hold stocks of stationery that can last for 20 years? Just in case readers have forgotten, this happened in Ghana, specifically within the Ghana Water Company Limited (GWCL).

The unusually large stocks were discovered by the company’s chief internal auditor much earlier, but it took the Committee of Enquiry set up by the then Minister of Works and Housing, Mr Kwamena Bartels, to break the news to Ghanaians in March 2001.

To readers I ask: Do you know why the news broke at all? My suspicion is that top management of the GWCL may have been known sympathisers of the National Democtatic Congress (NDC); indeed, whispers were that some were actually course mates of well-heeled top (P)NDC throne-room members.

In Ghana, it makes perfect sense why anybody will engage in such large purchases. We are believers in Chinua Achebe’s prescription in his novel, ‘No Longer At Ease’, that: “If you have to eat a toad, look for a fat and juicy one.” Ten per cent of the cost of a 20-year bulk purchase is certainly a fat and juicy toad. We are among the people spoken of by Kenyan Law Professor P.L.O. Lumumba that, “Our creed is our greed.”

So why, in June 2018, is Vice- President Mahamudu Bawumia sounding shocked that contracts for the construction of hospitals in Ghana are often inflated by over 400 per cent. It is our way of life.

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At a Value for Money conference in Accra last Monday, Dr Bawumia said: “While Ghana constructs 60-80 bed district hospitals for $25 million, the African Development Bank constructed a 150-bed hospital in Accra a few years ago for GH¢5.76 million or $1.3 million,” meaning that “for one hospital that we are building, we could have built six hospitals in Ghana”.

‘Value for Money conference’? Gracious me! In 2018? Did anybody think that the participants went there to learn anything new about procurements and value for money? I can bet: More than two-thirds of them had attended similar conferences, perhaps every year in the last 10 years.

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While at it, it will bear observing that the Vice President may have drunk too much of the milk of human sincerity. He seems incapable of controlling his blood pressure at the sight of inflated project costs running into millions of Ghana cedis.

I remember his shock on discovering, a few weeks after the NPP assumed the reins of government, that the cost of constructing an official residence for Vice-Presidents of the country was US$14 million! I also remember that he announced that the government would meet with the contractor, Architectural and Engineering Services Limited (AESL), to reconsider the cost. That announcement was in 2017.

What has happened since then?

Of course, it is possible that we are often too hasty to point at corruption when other causes may have been at play. The Vice-Presidential Mansion was originally estimated, in 2014, to cost US$3,563,884. For that figure to have shot up to US$13,968,252.66 as of January 2017 only suggests that it may have been hit by inflation. I am not an economist, but I suspect this is what happens to projects whose estimates are not inflation-adjusted.

Having acknowledged this possibility, I also know too well the greed mentality of Ghanaians when they are put in charge of schemes such as the Ghana Youth Employment and Entrepreneurial Development (GYEEDA), Youth Employment Agency (YEA), National Health Insurance Scheme (NHIS), the tree planting project in the North and the Akomfem (Guinea fowl) project, all of which either failed totally or suffered severely because of corruption.  

Procurement processes are the easiest pipeline for siphoning money from the state into private pockets. That is why I was glad when President Nana Akufo-Addo appointed a Procurement minister. In his State of the Nation address this year, however, he broke my heart when he announced that out of 394 sole-sourcing requests made in 2017, some 223 of them, representing 56.6 per cent, were approved.

It broke my heart back then, and still does, because as Mr Franklin Cudjoe, the IMANI Africa President noted recently, sole sourcing “must be rare”.  I agree with him because that was exactly the position of the NPP in the run up to the 2016 election. 

I must admit that corruption in public procurement exists also in developed countries. A researcher wrote that the US spends approximately US$530 billion a year on procurement, and added that although the country has extensive laws and regulations in place, its system is not free from corruption. There have been many (more than several) instances in US history, especially aviation contracts.

In Italy, it was found that the cost of several major public construction projects fell dramatically after the anti-corruption investigations in the early nineties. The construction cost of the Milan subway fell from $227 million per kilometre in 1991 to $97 million in 1995, and the cost of a new airport terminal tumbled from $3.2 billion to $1.3 billion.

Why? They had reason to fear that ‘Big Brother’ was watching.

But the Ghanaian does not fear ‘Big Brother’. He/she knows that after all the heat by Public Accounts Committee(PAC), for instance, there will be no fire. We have no motivation to fear God.

Corruption kills. That 70-year-old man who died after being refused admission in seven hospitals for lack of beds may have  been an NDC sympathiser; but he may also have been an NPP sympathiser.  Corruption killed him.