About 10 trillion cedis loss to state exposed

Accra, Dec. 15, GNA - About 10. 2 trillion cedis has so far been revealed to have been lost to the state and about 219.47 billion cedis recovered, Mr Yaw Osafo Maafo, Minister of Finance and Economic Planning, told Parliament on Wednesday.

Mr Osafo Maafo, who was answering a question in Parliament, said in March 2001, the government declared its intention to conduct management and financial audits into the operations of several public institutions including the Tema Oil Refinery, State Insurance Company and the Ghana Water Company.

..."My Ministry has continued to receive all kinds of payment requests for contracts executed for which there are no traces of documentation. Obviously the only option left to us was to subject these payments requests to forensic audits to determine the legitimacy of such claims."

"Mr. Speaker, so far, a total of 10, 247 billion cedis have been uncovered to have been lost to the state and 219.47 billion cedis recovered, while altogether we spent 11.7 billion cedis (5.33 per cent of the recovered money) on the forensic," the Finance Minister told Parliament in response to a question.

Ms Akua Dansua, NDC-North Dayi, had asked the Minister how many forensic audits had been done since January 2001, who commissioned the audits, which firms did the audits and who paid the fees involved.

Mr Osafo-Maafo mentioned Ghana Airways, the Divestiture Implementation Committee and the Ghana Supply Company as some companies that were also audited and said the audits were funded mostly from the Public Enterprise and Private Technical Assistance Credit of the World Bank.

"Mr Speaker, the findings of these audits revealed a complete breakdown of corporate governance procedures in most of these entities leading to abuse of the procurement processes and misuse of public funds resulting in losses of huge sums to the state."

"The results of the forensic audits in terms of their contributions to criminal proceeding, recovery of funds, enhancement of management structure have been tremendous,' he added.

The Minister said a number of debts were either repudiated or rejected on the basis of fraudulent claims, which had no contractual basis. Others revealed overpayments, illegal foreign transfers running into millions of dollars and deutsche marks, inflated contract claims and payments received for no work done or services provided.

He, however, said the implementation of the recommendations of the audits had led to the payments of higher dividends to government over the past two years, adding that the implementation of three new laws including the Internal Audit Act 2003 would enhance transparency and accountability in the operations of all public entities and reduce corruption.