More than 50% variation of contract sum for the construction of 18 housing units for the Ghana Armed Forces (GAF), ballooning from the original cost of GH¢16.6 million to GH¢25 million, took the centre stage of yesterday’s sitting by the Public Accounts Committee (PAC) of Parliament.
That was when the Minister of Defence, Dr Benjamin Kunbour and top hierarchy of the GAF appeared before the Committee to respond to queries in the Auditor General’s report.
The contract was awarded in 2007 but took effect in 2009 and when the 2011 report of the Auditor-General was compiled, the contract sum had shot up over 50%, with most of the contractors taking various sums of money and leaving the construction sites.
As at the time of the report, only one unit of the project had been completed and the rest left at various stages of completion – between 41% and 90% – without any structural changes.
The minister said the unfortunate thing was that most of the contractors could not be traced after abandoning the projects and that the last time his outfit made an attempt to reach one of them it proved futile because his address had been changed
According to Mr Kunbour, the ministry would put out public notices for the contractors to contact it (ministry) to enable it establish how much each of them had received from the government and whether the contract ought to be abrogated or not.
He said since taking over the ministry in 2014, he had taken a lot of interest in the project because it would help provide decent accommodation for officers and men of the Ghana Armed Forces.
The project is being funded with a loan facility from the Social Security and National Insurance Trust (SSNIT).
The vice chairman of the Committee, Samuel Atta Akyea, said the issue at stake was very serious and so the ministry would have to furnish it (Committee) with all documents covering the contracts and the names of all the contractors to enable the committee make informed recommendations on the matter.
The Ministry of Defence was also faulted for wrongful payments of interests on delayed payments and fluctuations to the contractors who were engaged to build the houses.
According to the report, fluctuation payments alone amounted to GH¢2.3 million while GH¢602,779 was paid as interest. The auditors also observed that because the contractors were awarded two or more jobs simultaneously, they failed to meet the deadline.
Mr Samuel Atta Akyea said the committee would scrutinise the contracts very well and those who would be found to be at fault would be dealt with.
He supported a recommendation made in the report to the effect that management must be made to craft contract documents that would inure to the benefit of the state by inserting a caveat that would allow interest or fluctuation payments to only contractors who had completed their contracts and reasonable delays had occurred in the payment of certificates already submitted.
The Ghana Navy was particularly faulted for making purchases amounting to GH¢165,815 from non-VAT registered companies, which was in violation of Section 30(2) of the Financial Administration Act 2003.
The chairman of the committee, Kwaku Agyeman-Manu, said the overall performance of the GAF for 2013 was good, with just one infraction and asked all other government agencies to learn from the military.
Sitting will continue on Monday (not today) because of the funeral of the late MP for Abuakwa North, JB Danquah-Adu.
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