Accra (Greater Accra) 6th Sept. '99
The Minister of Finance, Mr Kwame Peprah has disclosed that the executive jet recently acquired for the state, was procured under a five-year lease agreement with the option of purchase at the end of the lease.
Speaking in an interview with the press on his return from a conference of African Finance Ministers in Nairobi, Mr Peprah said the government has so far made down payment of two million dollars and is expected to make semi-annual payments of $1.5 million over a five-year period to bring the total lease payments to $17 million.. If the purchase option is exercised at the end of the option the total costs will come to $19.3.
He explained that under the agreement, government could exercise an option to purchase the aircraft at the end of the lease period for 2.3 million dollars.
Asked why government opted for a lease agreement instead of outright purchase, Mr Peprah tendering supporting documents explained that such an option would have cost government $16.3 million (compared to the lease payments plus purchase option of $19.3 million) inclusive of warranty, refurbishment, avionics modification and training of pilots and mechanics.
He said mindful of the state of the economy and in the spirit of economic prudence, the government felt the lease agreement offered the best possible terms for the acquisition of the aircraft.
Answering a question about parliamentary approval of appropriation for the down payment of the $2 million, the Minister explained that the opportunity to acquire the aircraft occurred at a time when the appropriation bill for the year 1999 had been passed by Parliament.
It was therefore decided to make the initial down payment from budgetary contingency and subsequently make the necessary provision for the semi-annual payments in the budgetary provisions starting from the year 2000.
Mr Peprah also explained that the jet was acquired after extensive consultation and evaluation with both local and international aviation experts who certified it as very good value for money.
Asked about the disparity in the value he had disclosed and the 117 billion cedis value stated in a section of the private media, the Minister said that question could be best addressed by the journalist in the private media who came up with that figure.
