Ministry Defends $2m Luxury Cars

The Ministry of Power has issued a statement seeking to justify the expenditure of a whopping $1,745,159 (GH¢5,584,508 at current exchange rate) on 38 luxury vehicles by the Ministry of Energy and Petroleum (MoE).

The NDC government has blamed the opposition New Patriotic Party (NPP) for the expenditure saying, it was the NPP that initiated the move when in government. According to the NDC, the move started in 2006, given executive approval in 2007 and approved by parliament in 2008.

However, there was no budgetary allocation for the purchases of the vehicles per the Auditor-General’s report. They were bought with money meant for extending electricity to 1,200 communities under the Multi-Donor Budgetary Support Programme between 2010 and 2012.

The luxurious vehicles purchased include 20 Ford F150 truck at the cost of $700,769.64; two Grido Ford F150 at $120,949.56 and six Dodge Dakota SLT at $160,645.41.

The rest are three Ford Escape costing of $157,645.71; four Lexus LX570 at $438,921.57 as well as three Chrysler 300 at $166,217.13 – all totaling $1,745,159.02.

Additionally, there was the purchase of office equipment, including heavy duty photocopier, all totaling $51,757.39 with the grand total being $1,796,916.41.

Ministry’s Clarification
The statement entitled, ‘Ministry Of Power Clarifies US Exim Facility And Project Vehicles,’ signed by Edward Bawa, head of communications at the ministry and issued in Accra yesterday said ‘The attention of the Ministry of Power has been drawn to publications in the media about project vehicles purchased for the implementation of $350 million Weldy Lamont Associates Self-Help Electrification Project (SHEP) facility.’

According to Mr. Bawa, ‘The $350 million US EXIM facility was a sole sourced agreement,’ adding ’Negotiations for the said facility started in 2006.’

It went on, ‘The facility was given executive approval by the then President of the Republic of Ghana on 17 July, 2008. Subsequently, parliament gave its approval for same on 15 August, 2008.’

Project-Related Materials

Mr. Bawa said under the facility which was being executed by Weldy Lamont Associates, 85% of all projectrelated materials, including vehicles, were to be ‘procured from manufacturers in the United States.’

The release said the public should take notice that the U.S. EXIM facility helps create and maintain U.S. jobs by financing the sale of U.S. exports primarily to emerging markets throughout the world by providing loan guarantees, export credit insurance and direct loans.

2009 & 2010
‘In line with the agreement, 85% of all project-related materials, including all vehicles, were procured in U.S. models. The said vehicles, which were negotiated as part of the project prior to 2009, were delivered in 2010.’

Mr. Bawa stated, ‘In early 2009 when a new minister of energy assumed office, he carried out a value for money audit as a condition precedent for contract effectiveness.

‘After four rounds of hectic negotiations between the Government of Ghana team and the contractor, Weldy Lamont, which ended on 30 July, 2009, the price of materials was reviewed downwards, leading to savings of US$46 million.’

He claimed, ‘This resulted in the construction of new substations in Kintampo and Mim as well as the expansion of the Sunyani substation.

Local content was also increased from the originally agreed 15% figure to 30%. This enhanced the participation of Ghanaian-owned companies.’

‘Originally, the project was intended to benefit 1,200 communities.

Following the value for money audit in 2009 and reduction in scope of work in some communities among others, it was expanded to cover 2,130 communities in the Ashanti, Brong Ahafo, Western and Central Regions. So far, about 1,000 communities have been connected and the project is ongoing.’

BY William Yaw Owusu

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