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21.03.2012 General News

CP was overpaid 48 million Deutschmarks in 2001 – Kan-Dapaah

By Daily Guide
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The government overpaid Construction Pioneers (CP) 48 million Deutschmarks in 2001 as expatriate supervision fees for the construction of the Biriwa-Takoradi road.

The amount, which was not part of the bill of quantities, was detected in 2001 and that led the government to suspend the payment certificates for works done.

According to the Chairman of the Public Accounts Committee (PAC) of Parliament, Mr Albert Kan-Dapaah, when CP signed an agreement with the Ghana Highway Authority (GHA) on December 5, 1996, the fee for expatriate supervision was not included in the draft contract agreement.

Presiding at Tuesday's sitting of the PAC, Mr Kan-Dapaah said when the then Director of the GHA, Mr B.L.T. Sakibu, detected the error, he asked CP to remove the amount from the bill of quantities but that was not done.

He said the refusal of CP to remove the amount from the bill of quantities led to the government to overpay the CP.

The Minister of Finance, Dr Kwabena Duffuor, also appeared to assist in unravelling the circumstances surrounding the payment of 94 million euros to CP as settlement debt.

On the Assin Praso-Yamoransa road, Mr Kan-Dapaah said CP again prepared certificates for the state to pay for the abrogation of the contract but the government refused to pay because it claimed that the company did not fulfill its contractual obligations, such as the presentation of its performance bond to the GHA.

He said those revelations came to light when documents were made available to the PAC by the Minister of Roads and Highways, Mr Joe Gidisu, when he appeared before the committee last Friday.

He said it was the misunderstanding between the GHA and CP that triggered the arbitration between the government and CP at the international arbitration in London and the fraud case being contested in the courts.

Dr Duffuor told the committee that at a certain point when the arbitration was dragging on, CP engaged a debt collector to collect money from the government on its behalf on the various arbitration settlements and the interest accruing on them.

He said the debt collector succeeded in listing government properties that CP was threatening to sell to defray its claims and noted that CP was not prepared to sit down again for talks with the government.

He said it was at that point that the government decided to make a down payment of 14 million euros to CP to make it to rescind its decision and accept instalment payments, since the government was facing many cash flow constraints.

Dr Duffuor said since the judgement debts had been captured by the budget statement, there was no need again for the ministry to seek Cabinet approval before payment was made.

Source: Daily Graphic

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