Mr Samuel Atta Akyea, the Minister for Works and Housing, who dropped the hint, said a sum of $80 million, representing 40 per cent of the contract sum, was paid as mobilisation to the contractor (Construtora OAS Ghana Limited) when actual work had not started.
That, he said, made the contractor transfer $40 million abroad.
“I submit that the seed of the bankruptcy of the Saglemi Housing Project was sown by this dubious act. This racket was so strong that the Ministry did not demand a performance bond as necessary prerequisite before the release of $80 million,” the Minister said.
Mr Atta Akyea disclosed this when he appeared before Parliament to answer a question by Mr Frank Annoh-Dompreh, Member of Parliament (MP) for Nsawam-Adoagyiri, on the state of the Saglemi Housing Project.
Former President Mahama, on August 15, 2012 granted executive approval to the Ministry of Water Resources, Works and Housing to construct 5,000 affordable housing units by Messrs Construtora OAS Ghana Limited for sale to workers through a mortgage arrangement via Ghana Home Loans.
The contractor was to utilize a Buyers Credit of $200 million from Credit Suisse International for the project.
Mr Atta Akyea stated that despite the State paying more than 90 per cent of the contract sum, it was appalling to note that the contract was varied to 1,502 housing units from the original 5,000 whiles the sum remained $200 million.
He said the contractor could only deliver 636 housing units, which were unfit for human habitation because the necessary amenities like water and electricity had not been fixed and the entire project lacked on-site infrastructure, especially a drainage system.
However, 388 housing units are at various stages of completion.
Mr Atta Akyea also informed to the House that the Attorney-General (AG) asserted in an opinion delivered on May 8, 2019 that the contract for the project had elapsed.
He said the AG emphasised that all the contracts purportedly signed by Alhaji Collins Dauda, former Minister of Water Resources, Works and Housing, and former Chief Directors after the original contract had received Parliamentary approval were void and had no legal consequence.
He announced that the Ghana Institution of Surveyors had been engaged to conduct value-for–money audit after which the report would be sent to the AG for prosecution.
“Mr Speaker, their findings will indicate the extent of embezzlement of State resources via the vehicle of affordable housing delivery. All the traducers of the law will be arraigned before a court of competent jurisdiction to answer criminal charges,” he added.
Mr Sampson Ahi, former Deputy Minister for Water Resources, Works and Housing, has, however, described Mr Atta Akyea’s claim against Alhaji Collins Dauda as false.
He said when Mr Atta Akyea assumed office and visited the project site, he commended highly the contractor and the Ministry for supervising a good job and because of that he decided to continue the project without reviewing what he met.
He said Mr Atta Akyea, in March 2017, honoured a contract certificated to the tune of $5.6 million, which he paid and also extended the contract period to enable the contractor complete on schedule.
Mr Ahi also debunked claims by the Minister that $80 million were paid as mobilization to the contractor out of which he transferred $40 million abroad.
He said per the record from the project consultants; the Architecture and Engineering Services Limited – (AESL) and others, the first payment to the contractor was 20 percent, which amounted to $40 million, which was used to procure the equipment, facilities and other things needed to execute the project.
“If you go to the site today, you will see all the equipment that was used for the project,” he said.
Mr Ahi said the subsequent payments were made based on the assessment of work done.
He said there was report by the consultant that has stipulated all the payment and nowhere in that report has $80 million paid to the contractor at a goal.