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24.10.2005 General News

Standards Board's Woes

By Ghanaian Chronicle
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Information gathered by The Chronicle at the Ghana Standards Board (GSB) has revealed that there were shady deals regarding the purchase of ten-year-old mobile equipment for calibration of weighbridges, resulting in the loss of millions of cedis to the State.

GSB had entered into an agreement with Champo Enterprise Limited to purchase the vehicle at ¢350 million although the Transport Officer, Mr. Nogowu, and the Head of Industrial Metrology (HIM), Mr. J.O. Boadu, advised against the value quoted by Champo, as it was way above the price it was bought. A weighbridge is a weighing machine for vehicles.

TENAD Ghana Limited sold the vehicle to GSB at almost ¢200 million but was later registered in the name of Champo. The actual value from Vehicle Examination and Licensing Division (VELD) on the vehicle was ¢191 million. After GSB had paid for the vehicle at about ¢200 million to TENAD Ghana Limited, Champo went into an agreement with GSB for a yearly rental fee of ¢350 million per year. For the three years (1999 to 2003) that the agreement was honoured, GSB paid ¢750 million to Champo.

The weighbridge was eventually sold to GSB at ¢350 million with the support of the Director General of the Board, Mr. Nimo Ahenkora, and the former Acting Director General, Mr. Larry Yankey was then the Director General, Technical.

The total amount spent on the vehicle, according to documents available to The Chronicle, was ¢1.2 billion, when brand new ones on the market could have been bought for about ¢750 million.

Although, the transport officer was not in favour of the transaction, because of the age and the depreciated value of the vehicle, the management of GSB went ahead to sign the contract to buy the vehicle after the yearly rentals. The board went ahead to approve the purchase of the vehicle even though GSB had bought the vehicle at ¢200 million four years earlier from TENAD. "The CIF value was ¢191,297,754.00 in year 2000.

It should rather depreciate considering the frequent breakdowns. I think it has been over-valued," the HIM said on July 16, 2003.

Workers of the board also thought the vehicle should have been bought at the book value. "GSB should have bought it at the residual value but it paid more, that is, ¢350million, which is ¢150 million over the original price of ¢200 million. Champo initially wanted to sell the vehicle at ¢500 million," one worker said.

Apparently, Director of Legal Metrology, Rev. Papoe, also agreed with the Transport officer's comment on the value quoted by Champo. "I agree with the transport officer's comments on the value quoted by Champo and I also believe we need to verify the real owner of the test weights because threats of seizure had been expressed by Jemix Engineering Limited," he intimated.

The vehicle, when bought, did not have all the components, such as its own test weights because the GSB always borrowed test weights from companies like Carmeuse Lime and Ghana Highway Authority.

Although GSB was hiring the vehicle until it was bought, it was incumbent upon Champo to repair the weighbridge when it breaks down. Most of the expenses incurred in the maintenance and replacement of parts were borne by the GSB. In one such instance, GSB paid ¢14,450,000.00 comprehensive insurance premium.

Between January and June 2002, the weighbridge income and expenditure statement recorded a loss of ¢14,808,091.68.

These transactions took place when Mr. Nimo Ahenkora was the Director General of the Board whilst the former Acting Director General, Mr Larry Yankey, was the Director General, Technical.

One would ask where the Finance Director and the Internal Auditor were when the vehicle was bought, using the taxpayers' money.

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