Obuasi Assembly to use court action to retrieve loans

Obuasi (Ash), May 10, GNA - The Obuasi Municipal Assembly (OMA) has resolved to use legal means including court action to retrieve more than 900 million cedis owed by co-operative groups who were given loans from the Poverty Alleviation Fund (PAF) and Senior Minister's HIPC Fund since 2002 and 2003.

The defaulters took the loans to expand their farms and other agriculture activities.

The Assembly took the decision at its general meeting at Obuasi on Tuesday.

Mr Joseph Kwadwo Boampong, the Municipal Chief Executive had told the assembly that out of a total 231.5 million cedis given out under the PAF, only 88.070 million cedis had been recovered by the Agricultural Development Bank, leaving a balance of 143.430 million cedis owed by the beneficiaries.

Of the total amount of 950.4 million cedis disbursed from the Senior Minister's Fund to 89 groups, only 174.622 million cedis had been recovered leaving 775.778 million cedis in arrears. Mr Boampong said the recovery rate was poor and attributed the situation to the perception of many beneficiaries of the fund that "it is government money and that it is for free".

The MCE said as a result of the non-payment of the loans, the assembly had redesigned a new approach to the disbursement of future funds and that the proposal had been approved by the Ministry of Local Government and Rural Development.

He said the assembly had commissioned Partners in Rural Development (PARUD), a consultancy firm from the Kwame Nkrumah University of Science and Technology (KNUST) to conduct research into the Youth in Employment Programme and advise the assembly on the line of action to take. Mr Boampong added that Sinapi Aba Trust, an NGO with good track record in micro financing had submitted proposals to seek the collaboration of the assembly towards the management of the Youth in Employment Programme.

"I am strongly convinced that their vision is in line with our programme of action towards the youth employment and other related poverty alleviation programme", the MCE said.