Finance Ministry stalling GETFund growth – Parliament

The Parliament of Ghana, Wednesday, bemoaned the untimely releases of funds to the GETFund Secretariat by the Ministry of Finance for their planned infrastructural projects.

The House was equally not enthused with the absence of a legal framework to guide the operations of the GETFund Secretariat since its establishment in 2000.

The delays, the House observed, have resulted in cost overruns due to price fluctuations, project variations and high interest on delayed payments.

That aside, the absence of a Legal Instrument to indicate in detail the specific functions and activities to be undertaken by the Secretariat in managing the Fund was affecting its smooth operations.

Contributions from both sides of the House stressed the need for the Finance Ministry to be proactive in the release of funds to the GETFund Secretariat on time to avoid the extra cost being incurred by the State.

Members also urged the Minister of Education to ensure that an L.I. is presented to Cabinet for onward transmittal to Parliament for consideration and passage to address that challenges confronting the smooth operations of the Secretariat.

“If we want GETFund to operate effectively and contribute to the development of education in this country, then we have to make sure that the legal framework outlining the scope of their operations should be well captured to be able to guide the Secretariat to function properly”, noted the Member of Parliament for Dome/Kwabenya, Sarah Adwoa Safo.

“Delays in the timely releases of funds to the GETFund Secretariat put a lot burden on the tax payer. The delays must cease to avoid us from paying huge sums of interest on money borrowed to undertake projects. We must crack the whip so that those who allow these infractions to occur do not repeat it again”, MP for Keta, Richard Quashigah added.

The concerns raised by the House were in reaction to the report of the Public Accounts Committee on the performance audit report of the Auditor-General on the GETFund funded infrastructural projects in public tertiary institutions.*

A performance audit report conducted into the operations of the GETFund Secretariat by the Auditor-General has revealed that monthly disbursement into the Fund was usually in arrears between two and nine months.

This, according to the Auditor-General, prevented contractors from executing their job on the scheduled date.

“Due to delays in payment to contractors which resulted in the extension of time, price fluctuations on some projects increased the original cost of the project by about 44%”, noted the Auditor-General.

For instance, the report a price of a bag of cement increased from GHc5.70 in the year 2005 to GHc10.60 in the year 2006 when the project was scheduled to have been completed.

“As at April 2012, the Project was still on-going, and a bag of cement had risen to GHc19.00. Under such situations, the contractor will not be able to control cost overruns”.

On the issue of variations, the report noted situation normally increases the contract sum between 16% and 44% which was contrary to the acceptable level of 15%.

The situation, the Auditor-General added, constitutes a breach of the GETFund Act, 2000 (Act 581).

The report also revealed that the GETFund Secretariat do not have measures in place to reduce cost overruns relating to price fluctuations, variations and interest on delayed payment.

After deliberations on the matter, the Speaker of Parliament, Edward Doe Adjaho, directed that a copy of the votes and proceedings for the day and the Committee’s report be made available to Ministry of Education.