PUBLIC PROCUREMENT ACT FRAUDULENTLY SET ASIDE
.. Over US$ 27 million involved ... No Parliamentary approval sought The following story is culled from the "Daily Dispatch" of 18th October 2005.
On August 26, 2005, the Ministry of Education and Sports (MoES) wrote to the Public Procurement Board (PPB), seeking approval for a contract signed nearly a month earlier. We will give readers full details of how the Procurement Board was allegedly deceived into granting approval in a letter dated August 31, 2005.
On July 29, 2005, the Minister for Education and Sports, Mr. Yaw Osafo-Maafo, signed the Letter of Agreement on behalf of the Ghanaian government while Mr. Edward Addo signed on behalf of Macmillan Education Limited. According to the Agreement, the total cost of the supply "including insurance and freight to the Tema Port and delivery to the District Education Office shall be US$27, 999,990 which will be payable in cedis."
The Agreement stated the terms of payment, with the first tranche, i.e. 15% of the total contract value, to be paid on the signing of the contract. This value, US$4, 199, 998.50 was to be secured against a bank guarantee. A cheque for the cedi equivalent of $4,199,998.50 (at a cedi rate of ¢9,150 to $1), ¢38.42 billion was prepared. The cheque had to be validated by three signatories one signed but the two others refused on the grounds that while the huge order was sole sourced, there was no approval from the PPB.
On August 26, 2005, the MoES then wrote to the PPB, seeking approval to sole source the supply of the textbooks from Macmillan Education Limited. The MoES attached comparative price analysis of Macmillan and three other publishers - Heinemann, Oxford and Longman, observing that Macmillan was in all cases, very competitive.
The MoES did not, in that letter to the PPB, reveal that Ministry had, almost four weeks earlier, concluded and signed an agreement to effect the supply (emphasis ours). The Ministry did not tell the whole truth because some of those who were said to have submitted quotes had not been invited to do so. Based on the letter from the MoES, the PPB gave approval.
This is the August 31, 2005 reply from the PPB, signed by its Chief Executive, Mr. A. B. Adjei:
RE: REQUEST FOR APPROVAL OF SINGLE SOURCE PROCUREMENT FOR THE PURCHASE OF SUPPLEMENTARY READERS, TEXTBOOKS AND DICTIONARIES FOR BASIC /SENIOR SECONDARY SCHOOLS AND TEACHER TRAINING COLLEGES.
Please refer to your letter dated August 6, 2005 on the above subject.
The Board has carefully studied your submission for Sole Source approval to procure supplementary readers, textbooks and dictionaries from Messrs Macmillan Education Limited and wish to respond as follows:
1. We observe that your Ministry and its Agency, the Ghana Education Service are both convinced that Macmillan published books are most suitable for our students and have accordingly decided to opt for Macmillan as your preferred choice of supplier partly because the story books of Macmillan are written in the cultural and environmental context of the Ghanaian and African child.
2. We have also taken note of the fact that Macmillan happens to be the exclusive copyright owners of your selected books and that it does not make economic sense to go to a different publisher to publish materials which another publisher holds the copyright.
3. The Board has noted the attached comparative price analysis between Macmillan and three other publishers namely: Heinemann, Oxford and Longman and has observed that Macmillan was in all cases very competitive.
In the light of the above, the Board hereby wish to grant you permission to use sole source method to procure the selected books per Macmillan's invoice No. 14605 dated June 14, 2005 at a total Tender Value of US$27,000,990 on the grounds of our response as stated in point one to three and in accordance with section (40(1a) of Act 663.
We hope to be of assistance at all times in matters like this.'
The Daily Dispatch would like President John Agyekum Kufuor to investigate the award of this contract, to provide answers to nagging questions like: Was the July 29, 2005 agreement valid? Does the non-disclosure to the PPB that it had already signed an agreement, amount to deceit of a public officer? Were bids invited from Heinemann, Oxford and Longman in respect of this particular supply of textbooks? If bids were not invited, was it another deceit of a public officer? MORE DETAILS IN THE DAILY DISPATCH LATER THIS WEEK
Ghana Palaver Investigation Findings reveal no Parliamentary approval
Since the Daily Dispatch publication, Ghana Palaver has learnt that the whole transaction is being pre-financed by Macmillan Education Limited and that it is a loan facility to be repaid by the Government of Ghana after two years.
The loan agreement was never taken to Parliament for approval. Article 181(3) of the 1992 Constitution states as follows:
"No loan shall be raised by the Government on behalf of itself or any other public institution or authority otherwise than by or under the authority of an Act of Parliament"
Article 181 (4) states as follows:
"An Act of Parliament enacted in accordance with clause (3) of this article shall provide that the terms and conditions of a loan shall be laid before Parliament and shall not come into operation unless they have been approved by a resolution of Parliament."
Article 181(6) defines 'loan' to include "any money lent or given to or by the Government on condition of return or repayment, and any other form of borrowing or lending in respect of which (a) money from the Consolidated Fund or any other public fund may be used for payment or repayment; or (b) money form any fund by whatever name called, established for the purposes of payment or repayment whether directly or indirectly, may be used for payment or repayment".
The failure to secure Parliamentary approval, which is a breach of the Constitution, is in fact a much more serious matter than the breach of the Public Procurement Act which is a breach of an Act of Parliament. ...OSAFO-MAAFO BETRAYED FROM WITHIN? Before our story above was done, we were approached by a very high-level NPP operative who pleaded for us to drop the story because according to him, it is part of the internal NPP machinations to knock the Minister of Education and Sports, Mr. Yaw Osafo-Maafo out of the NPP Presidential contest.
According to the NPP operative who did not request anonymity but whom we have exercised our editorial discretion and decided to grant anonymity to, the whole Macmillan transaction was deliberately leaked to the Daily Dispatch by one of the contestants in the NPP Presidential primaries' bid who has planted his agents all over the public service to ferret for dirt and improper conduct with which to smear his contesting colleagues.
The NPP operative has actually given us the name of the NPP Presidential aspirant involved but we are not revealing it for now.
We asked the NPP operative one question, which shut him up: 'But is the story true?
"Yes," he responded.
"Then we are sorry for Mr. Osafo-Maafo, but the Ghanaian people must know the truth".
He seemed to understand our position and left rather dejectedly. He did not, however, attempt to give us any black polythene bag.