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More state assets on sale but...

Tue, 2 Jul 2013 Source: The Scandal

The Government of Ghana, as part of its agenda to privatize State-Owned-Enterprises (SOEs), has intensified its campaign by putting more of such enterprises on the divestiture list. The state enterprises under the hammer range from rubber companies to hospitability centers.

The intention of divesting such state assets among other things is to unlock the economic potential of Ghana by releasing resources of people, money and technology to be put to their best use and by increasing efficiency to achieve better living standards for all.

However, the Divestiture Implementation Committee (DIC), the body mandated to spearhead this ambitious plan is not looking good, relative to the accounting for proceeds received from divested state assets, which began in 1989.

Indeed the Auditor-General’s report for the year 2011 says proceeds from the sale of seven state companies have still not been paid into the Consolidated Fund as was directed, neither is there any clear indication as to where the proceeds are currently lodged.

According to the Auditor-General’s report on the Public Accounts of Ghana (Consolidated Fund) for the year ended 31st December 2011, GHc8.3 million accrued from proceeds of seven divested state assets had not been paid into the Consolidated Fund as required by law.

The report shows that even a payment of GHc4,050,000 made by the Zoomlion Group as part payment for Ghana Consolidated Diamonds Company Limited during the year under review, “had not been paid into the Consolidated Fund” as was directed.

Similarly, proceeds from the sale of state assets such as Tema Shipyard and Drydock, Atlantic Hotel, Takoradi, GIHOC Pharmaceuticals among others, amounting to about GHc4, 277,554.50 has still not been paid into the Fund.

The questions the Scandal has been asking since this matter came up are:

  1. Have the investors paid for these assets that they bought?
  2. If they have paid then where are these monies currently lodged and why?
  3. 3. If they have not paid then what is the time limit given to investors to pay?
  4. 4. If the monies are still outstanding, then how are they being treated? As loans with interest or as Grants? Have the investors taken over the assets?
  5. And
  6. Does the DIC have the mandate to utilize proceeds from the sale of public assets?


Ever since the Auditor-General’s report made those interesting findings against the DIC, there has not been any official response, but the information the Scandal is picking from the DIC is that funds accrued from the sales are used to run its Secretariat at Labone. “The DIC has the option and mandate to use such funds to take care of their expenditure in the course of their operations since the government has stopped resourcing it adequately,” explained a source.

Among the latest SOEs put up for sale are the Bonsra Tyre Company Limited (BTCL), the Bolgatanga Catering Rest House (BCRH), the GNTC Guest House in Tamale and Eredec Hotel in Koforidua.

Whereas prospective investors in the Bolgatanga Catering Rest House are expected to fork out US300.00 to purchase Registration of Interest forms, their counterparts who are interested in the GNTC Guest House in Tamale are to dish out GH¢200.00 to purchase same forms.

Regulation 10 of the Financial Administration Regulations 2004 requires MDA’s to pay into the Consolidated Fund gross receipts from the sale of government assets (Equity Investments and other assets)”.

The Government of Ghana established the Divestiture Implementation Committee to implement and execute all government policies in respect of divestiture programs. Details about DIC are set in the Divestiture of State Interests (Implementation) Law, 1993, (PNDC Law 326).

DIC's functions under the law among others are: to plan, monitor, coordinate and evaluate all divestitures.

Source: The Scandal

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