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28.11.2005 Press Review

Are kickbacks the solution?

By Statesman
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THE National Chairman of the ruling New Patriotic Party has reportedly made an allegation that puts the President in the centre of corruption. While both the Castle and Mr Esseku have denied the allegation, what is absolutely clear is that there is a widespread belief that the Presidency controls funds meant for the party, perhaps instigated by the National Chairman, similar to what has been published by The Enquirer.

But Kwaku Baako Jnr, Editor-in-Chief of the Crusading Guide, believes there is a clear difference between legitimate efforts to raise funds for a party and corrupt deeds aimed at raising funds for a party, including the payment of a percentage of contract sums to the awarding authority.

“Kickbacks, in my opinion, are illegal, unauthorised commissions taken on contracts awarded to companies in business or major players in the economy. A clear distinction should be made between those and efforts by party and government officials to raise funds for the party through the organisation of fundraising activities. That is a legitimate way of raising funds to run a party,” he told this reporter in an interview at the weekend.

“Yes, there is a thin line between the two, but the distinction is clear for anyone willing to consider the two scenarios on their merit.”

In any case, Mr Baako insists, allegations of 'kickbackism' are not a new phenomenon. Specific allegations have been made for a long time.

In the early 1950's, Ashie Nikoi, member of the first Central Committee of the Convention People's Party, made startling allegations, 'revealing' that he had collected and or received kickbacks from some companies, and that he had passed on such monies to the leader of the party, Kwame Nkrumah. He was subsequently expelled from the party.

S I Idrissu, deputy Ministerial Secretary for Information and Broadcasting, in the late 50's also announced that some kickbacks had been paid to Dr Nkrumah by Savundra, a South East Asian businessman, through his boss, Kofi Baako, father of Mr Kwaku Baako Jnr. He retracted the allegation, but was expelled from the party. He was, however, later reinstated.

When Obed Yao Asamoah sought the position of National Chairman of the National Democratic Congress, charges of financial malfeasance were levelled against him by some elements within of the party, which charges were actively propagated by Tony Aidoo, former NDC Director of Research, and Ekow Spio Garbrah, former NDC Communications Director. A document released by these NDC elements read in part: “Dr Asamoah, very early on in his chairmanship of the Finance Committee, developed the ostensibly smart practice of never issuing receipts for business contributors or other party members. He however requests receipts from those to whom he disburses funds.

“By this simple practice, he has made it absolutely impossible for anyone in the NDC to know the total amount of money he controls at any particular time. “The pretext that his operations need to be hidden from the Electoral Commission and other law enforcement agencies is understandable, but how does he account to the party that has entrusted this responsibility to him?”

In his response, Dr Asamoah adds to the mounting evidence of perceived wrong doing.

“The process of accountability involved disclosure to the Ways and Means Committee of the sources of the funds…That Dr Asamoah would not give receipts for funds received was an obvious precautionary measure…”

Several contracts were signed after the 1st round of the December 2000 election, and even after the 2nd round. A typical example is the Korle Lagoon Dredging project, signed after the 2nd round. According to sources close to the deal, the former First Lady and Eddie Annan, NDC financier, tried but failed to get the contract for the project.

Caridem, Calf Cocoa Processing Company, and other NDC-controlled projects were conceived as 'cash cows,' but have not borne the required fruits, insiders told this paper. In the run up to the 2004 elections, NDC bigwigs denounced such companies, including SecPoint Securities, for neglecting the party after they lost power.

Perhaps even more serious is a letter written by George Mould, retired pilot of the Ghana Air Force, in 1996, the contents of which are being investigated by the law enforcement agencies. The letter, addressed to then President Rawlings, read in part, “I propose that as a bonafide agent for COTECNA, I could go to the management of COTECNA with the President's backing and insist that monies due me be paid to the party. I shall then request that they pay upfront all the monies that will upon projection accrue on my account to the end of the contract period. This being election year, it could go a long way to help renew their contract come 1997.

“I believe they should be happy to part with US$500,000…”

Similar allegations dogged the Busia, Limann, and all the military regimes that have ruled the country. While some were investigated and found to be false, others were proven to be true, says he.

Mr Baako is emphatic that the attempt to trace previous allegations of 'kickbackism' is not an attempt to justify it. Rather, says the firebrand CPP stalwart, it is an attempt to place the current allegation in the correct perspective.

“We know these allegations have always been present. What is missing in this particular case is the provision of evidence to corroborate the allegation. In the interest of the general public, I would plead with the Editor of The Enquirer to play just a part of the tape he says he has, so we can establish that indeed Mr Esseku made those allegations. As it is, we are all arguing and jumping to conclusions without any evidence to back it up.”

Mr Esseku and the paper, he maintains, should be given the chance to defend themselves on an organised platform, preferably one composed of investigators into the allegation. What appears to have lent credence to The Enquirer's story are the reported cases of the embattled chairman passing on the blame for the party's weakened structures to the Castle in his bid to retain his seat and share the blame for the failings of the party on as many quarters as possible, says he.

The present situation is a recipe for coups, Kwesi Pratt Jnr, Managing Editor of the Insight, has warned.

“The history of coups is that adventurists always take advantage of such situations to stage coups,” he admonishes. Constitutional bodies must be allowed to undertake their proper functions to ensure the rule of law, Mr Pratt insists, to avert any military upheavals. He is however adamant that the President should be forced out of office if the allegations are proven to be true.

“If the allegations reportedly made by the National Chairman of the NPP are proven to be true then President Kufuor must be impeached,” he told The Statesman over the weekend.

Reached for comment, a senior law enforcement officer told The Statesman the security agencies were studying the situation and would take appropriate action. Asked if they were not going to request for more information from Mr Esseku or The Enquirer, he told this paper The Enquirer was only reporting what Mr Esseku is alleged to have said. “Mr Esseku has in any case denied that he said that. The fact that the Castle has been mentioned does not mean the President is involved. The paper is only drawing inferences, not provided any evidence to back it up,” the officer said.

The incidence of governments allegedly funding their parties with kickbacks from winners of government contracts is not a new phenomenon. In France, President Chirac almost lost an election because of allegations of campaign fraud levelled against his party, the RPR. Mr Chirac, as Mayor of Paris, gave out 'juicy' contracts to friends and party faithful, and the kickbacks from these contracts were then used to fund his new party, the RPR, investigators alleged. His Prime Minister and heir apparent, Alain Juppé and 21 of Mr Chirac's former aides and business partners were convicted in December 2000 in relation to the funding of M Chirac's RPR party during the late 1980s and early 1990s. In a tough ruling, Judge Catherine Pierce effectively ended Juppé's political career by banning him from public office for 10 years and handing him an 18-month suspended prison sentence. Earlier, his Finance Minister Dominique Strauss-Kahn had resigned in November 1999 amid allegations that as a practicing lawyer he was involved in party campaign funding irregularities before his Socialist party came to power in 1997.

Israeli Prime Minister Ariel Sharon and his son Omri Sharon, a lawmaker and key adviser to his father, have also been rocked by allegations of financial malfeasance bordering on campaign financing. On November 15, Omri Sharon 41 was convicted of charges related to the financing of his father's 1999 primaries campaign, after he entered a guilty plea at the outset of his trial.

Mr Baako advocates State funding of political parties as a way of minimising 'kickbackism.' “Regulations on party accountability would also help,” he adds. This would involve empowering the Electoral Commission and the law enforcement agencies to look into and prosecute cases of campaign malpractices.

“I believe this allegation should be looked into. But this can only be helped if Mr Archer would play just a portion of the purported tape.”