GHC17.8bn road debt commitment fees hang over gov’t
Roads Minister, Kwasi Amoako-Attah, has said government is expected to pay GH?17.8billion as ‘commitment fees’ inherited from the previous administration on road contracts.
He told Parliament on Wednesday, when he was contributing to the President’s State of the Nation debate that: “As at January 1, 2017, the total commitment at the road sector amounted to GH?17.8billion”.
According to Mr. Amoako-Attah, the commitment fees comprised all the road contracts put together: “Commitment is all the contracts awarded put together; and once they are contracts and duly executed by the employer [government] and the contractor, all the terms and conditions therein are obligatory and binding unless steps are taken to set any of them aside legally. So, a commitment hangs on government unless it takes legal steps to set them aside, and I am saying that all the commitments put together across the nation was GH?17.8bn”.
He also disclosed that the cost of completing the road projects amounted to GH?12.8billion.
Mr. Amoako-Attah however maintains that despite the huge debt hanging on government, it is still determined to fix the roads to a befitting status.
“We took over a huge debt overhung in the roads sector. As at January 2017, the government of Ghana was owing contractors from GoG sources at the Ministry of Finance, GH?1.1bn.
The minister also indicated that government did not have access to the road fund, since the previous administration had mortgaged it to UBA bank for a loan.
President Akufo-Addo told the press during his one-year in office address last month that his government was working hard to clear debt owed to road contractors.
“In 2017, nearly GH¢1billion (GoG – GH¢300.4million; Road Fund- GH¢664million) of the GH¢1.6 billion owed to road contractors was cleared. In January this year, we have disbursed GH¢125million of the remaining GH¢600million to the contractors.
Additionally, the president stated, government has paid GH¢826million of the GH¢1.2billion loan contracted by the previous administration – for which the Road Fund was used as collateral.
The Western, Eastern and Central corridor, trunk roads, feeder roads and town roads across the country are all expected to be completed during the current government’s tenure.