SCAM: Ghana spends over US$2.1 billion coronavirus cash on shady deals - Report

The Government of Ghana (GOG) has been cited in a corruption risk assessment report by the Community Development Alliance (CDA-Ghana) and the Commonwealth Foundation, for spending over US$2.1 billion COVID-19 cash on corrupt deals.

The 67-page report dubbed ‘Strengthening COVID-19 Accountability Mechanisms (SCAM)’ and available to GhanaWeb reveals a number of questionable deals the Government of Ghana under the leadership of President Nana Addo Dankwa Akufo-Addo took when the nation recorded its first two cases of the Novel Coronavirus.

The corruption risk assessment was carried out between March to April 2021, based on a review of background documentation, including the national legal regulatory framework for public procurement, with a focus on integrity-related issues, official records in both electronic and hard copy formats, checks (formal enquiries) with state agencies, and interviews granted by governance and anti-corruption experts.

The report consists of two parts: “An assessment of corruption risks characteristic to COVID-19 public procurement, including mapping of integrity risk areas and recommended measures for integrity/corruption risks mitigation. This assessment uses the OECD Methodology for assessment of national procurement systems (MAPS);

“An optimal risk indicator system based on the ‘red flag’ concept,” the SCAM report stated.

The report concluded: “Government of Ghana have accessed and utilized GH¢12,440,710,000 ($2,144,950,000) from sources such as the World Bank, IMF, Ghana Stabilization Fund, Contingency Fund of the Stabilization Fund, Ghana Heritage Fund, Ghana Exim Bank and the COVID-19 Trust Fund set up by the government.”

They further explained, “the assessment also clusters Ghana’s COVID-19 corruption risks around two main issues – irregular procurement practices that violate Ghanaian procurement laws and corruption risks that indicate that there have been substantial breaches of anti-corruption laws, regulations, codes and international conventions and best practices.

Irregular Procurement

The report cited “irregular procurement” in the award of contract to four Ghanaian garment manufacturing companies.

The companies, the report revealed, “had been given loans of $10m through the Ghana Exim Bank to produce PPEs, face masks, medical scrubs, hospital gowns and headgear without tender and the companies had been selected.

“The companies also were not registered with the Public Procurement Authority (PPA) at the time of contract award,” the SCAM report stated, thus revealing a clear defrauding of the system by very corrupt minds.

It went on: “A $1m contract awarded to develop the COVID-19 tracker app to two foreign companies namely iQuent Technologies and Ascend Digital Solutions (registered in Jersey, a tax haven) was irregular. The two companies were not legal persons in Ghana at [the] time of contract awards [and] were not registered with the PPA, and did not go through tender.

“Contracts worth GH¢60m for fumigation services and logistics such as sanitisers, masks, dustbins, cleaning kits, etc., to all districts by the Ministry of Local Government from its allocation under the District Assemblies Common Fund for the 2020 fiscal year was mostly without tenders.”

The report added the contract awarded to “Frontiers Healthcare Solution Services Limited to conduct Covid-19 antigen tests at the Kotoka International Airport was without tender, the company was not registered with PPA and unlicensed by the health facilities regulator, HEFRA”.

“The supply of 18,000 Veronica Buckets; 800,000 pieces of 200-millilitre sanitisers; 36,000 rolls of tissue paper; 36,000 gallons of liquid soap and 7,200 thermometer guns distributed to schools were opaque and not tendered. It's unclear who the suppliers were and how much was spent on this procurement.

“Contract for [the] provision of hot meals for 540,000 final students and teachers who sat for the 2020 WASSCE and BECE exams for three weeks was opaque, with no full disclosure of who were awarded these contracts, from which fund the contracts were awarded and whether the contracts went through the proper procurement processes.

“Contract for nation-wide disinfection and fumigation of over 464 markets was awarded to Zoomlion on a sole-source basis in addition to another contract by the Ministry of Education and Ghana Education Service to disinfect and fumigate over 850 High Schools across Ghana and 3700 schools in the Greater Accra region.”

Corruption Risk

There are issues with funds of $1.2 million meant for the payment of 900 contact tracers employed by the Ghana Health Service to work on case detection, contact tracing and reporting, 600 of whom dropped out later due to various grievances, chief among them are the erratic payment of their daily allowance of $25 (GH¢150.00).

The report averred, “a corruption risk arises over whether an employment contract regulated the work of the contact tracers, the terms of their engagement, how much was actually paid to them, for how long and why 600 of them dropped out”.

During the height of the pandemic, Vice President Dr Mahamudu Bawumia on April 13, 2020, launched the GH COVID-19 Tracker app which is to help boost the Ghana Government’s fight against coronavirus.

During the launch, Dr. Bawumia noted the app, "will help us easily track people with the virus, [and] those who have had contact with others. It is also useful in quarantine reliability, in case certain individuals need self-quarantine,” touting that Ghana is one of the few countries to deploy such a tracker.

But the corruption risk assessment report says the $1m contract awarded to develop the COVID-19 tracker app to two foreign companies namely iQuent Technologies and Ascend Digital Solutions "raises substantial corruption issues. Ascend Digital Solutions was registered just a month before the contract award in Jersey, a tax haven, and the contract sum appears bloated. Same applies to the GH¢1.4m ($240,000) spent on the launch of the tracker."

“Contract awarded for free food during the partial lockdown in Greater Accra and Greater Kumasi is perhaps the biggest red flag in the whole COVID-19 spending saga, with many doubting the number of people fed, the period of the intervention, the way caterers were contracted and the unit cost of the food packages, with GoG not helping the situation by giving conflicting figures and accounts. GH¢42 million was spent on hot meals during the period, without any proper tendering or documentation.

“An amount of GH¢2 million was allocated to transport frontline health workers during the partial lockdown in Accra but doesn’t appear to have been fully utilized, leaving GH¢1,622,000 unaccounted for under the Free Transport for Health Workers allocation.

“It is unclear how $7.4m earmarked for community engagement and risk communication – from 1st release of $35m from the World Bank was spent. A National Information Contact Centre (NICC) at the Accra Digital Centre was set up to provide information on COVID-19 and related matters but unclear how much GoG spent on that set-up.

“An amount of $12.7m was earmarked for containment, isolation and treatment - from 1st release of $35m from the World Bank. GoG spent $2,163 million on 16 hotels and guest houses during the initial wave of arrivals. Even if GoG spent an additional $2 million on all the other isolation centres during the initial wave of the pandemic, there appear to be unspent funds of $8.6 million within this allocation that needs further investigation.

“The IMCC made up of Ministers and the Public Health Emergency Operations Centre were to use part of an allocated $3.4m to coordinate and oversee the contracts for private sector management of the yet to be completed infectious disease centre (s) and medical villages throughout the country. No work has commenced yet so unclear how GoG utilized this allocation. This represents another corruption risk that needs further investigations.

“Additionally, the Administrator of the Common Fund, Irene Naa Torshie Lartey, in a letter dated April 9, 2020, released GH¢166,280.62 each to the 260 districts towards the pandemic fight. No district has accounted to the people for how this release was spent.”

Though Ghana’s procurement laws are fairly robust and adequate, the PPA Act vests power in the Minister of Finance to direct the use of a different procurement procedure where the Minister determines that it is in the ‘national interest to do so’ (i.e. a scenario where the nation attaches high value, returns, benefit and consideration to the matter in question).

Where the Minister makes such a determination, the procurement method shall be published in the Ghana Gazette. The Government of Ghana appears to have relied on this provision in the Act to circumvent the law in awarding almost all contracts during the pandemic.

Donations

After the announcement of Ghana's first two coronavirus cases in March 2020, several companies have donated in-kind and cash to the National Covid-19 Trust Fund and the Government of Ghana.

For instance, in 2020, Zenith Bank Ghana alone donated GH¢1,000,000 at a ceremony held at the Information Ministry in Accra towards the fight against coronavirus.

The World Bank, International Monetary Fund (IMF), among a host of other corporate institutions have donated cash to the Akufo-Addo Government towards the fight against coronavirus.

The report recounted that “On March 19, 2020, a panel of 80 finance ministers, presidential aides and central bankers held a virtual conference with the United Nations Economic Commission for Africa (ECA) on how Africa could respond to the pandemic. Co-chaired by South African Finance Minister, Tito Mboweni and Ghana’s Finance Minister, Ken Ofori-Atta, the conclusions of the financial impact assessment were only shared with government officials.”

“Following the virtual briefing, ECA Secretary-General Vera Songwe, sent a private letter to the IMF and the World Bank, co-signed by Mboweni and Ofori-Atta, asking for “$100 billion for the immediate response” to the widening pandemic, with contributions from the World Bank, the IMF, the European Investment Bank, the African Development Bank (AfDB) and Afreximbank.

“The letter also asked for an immediate waiver of all interest payments on all debt estimated at US$44million for 2020 with possible extension to the medium term. On April 13, 2020, the IMF Executive Board approved the disbursement of US$1 billion to Ghana to be drawn under the Rapid Credit Facility,” it added.

“The Government of Ghana (GoG) announced a series of response measures involving huge expenditure outlay estimated at over $2 billion part of which was a Rapid Credit Facility From The International Monetary Fund (IMF) of $1 billion. Despite the huge expenditure outlay announced by the government of Ghana in its response to fighting the COVID-19 pandemic; an Anti-Corruption Tracker published on the website of Transparency International has flagged Ghana as one of the “high corruption risk countries which have failed to put in place anti-corruption measures, as part of their COVID-19 financial assistance and debt relief from the IMF”, it stated.

Gov’t cliché of “we are not in normal times”

The CDA-Ghana and Commonwealth Foundation report stated that the pandemic no doubt has created conditions in which corruption could flourish. The common cliché by government officials “we are not in normal times” as an excuse to circumvent procurement regulations further heightens the corruption risk associated with government response to fighting the pandemic which has the potential to exacerbate and prolong the negative effects of the crisis on the lives of poor and vulnerable populations in Ghana.

“It is against this backdrop and in line with its mandate; CDA-Ghana in February 2021, secured a 10-month small-grant project funding from the Commonwealth Foundation (CF) to implement a citizens-led advocacy and social accountability action titled Strengthening COVID-19 Accountability Mechanisms (SCAM). The SCAM Project will use evidence generated to trigger citizens led anti-corruption advocacy actions including possible engagements with relevant committees of Parliament, the government so as to strengthen COVID-19 ministries, departments and agencies of Accountability Mechanisms in Ghana,” the report stressed.