General News of Wednesday, 18 July 2012
A former Minister of Education and Sports, Mr. Yaw Osafo-Maafo Tuesday informed the Financial Division of the Fast Track High Court that Waterville did not fulfill its obligation to raise funds for the rehabilitation of three stadia for CAN 2008 tournament.
He said Waterville failed to satisfy clause 17 of a Memorandum of Understanding (MOU) which obligated the company to raise funds for the rehabilitation of the Kumasi, Accra and El-wak stadia.
Waterville was then represented by Alfred Agbesi Woyome, the businessman, who is standing trial for allegedly defrauding the state to the tune of GhC51.2 million.
The 14-paged MOU, which was dated September 30, 2005 also tasked CONSAR and Micheletti and Company to embark on the rehabilitation works.
Led in evidence by a Chief State Attorney, Ms. Cynthia Lamptey, the witness told the court that following the inability of Waterville to raise the needed funds, the government at the time raised $50 million loan from the Barclays Bank to finance the project.
He said the loan agreement between the government of Ghana and Barclays Bank was approved by Parliament.
According to Mr. Osafo-Maafo, who is also a former Minister of Finance and Economic Planning, Waterville dealt directly with Bank Austria, the bank which was expected to fund the rehabilitation of the three stadia.
The witness, who was subpoenaed to testify in the trial, also said construction of the Tamale and Takoradi stadia were funded from the Consolidated Fund.
Justifying why the tender process for the award of contract for the construction of new stadia was cancelled, the former minister said the country saved more than $50 million when the contract was awarded to Shanghai Construction Limited.
Asked if he had heard of or knew Astro Invest, Mr. Osafo-Maafo answered in the negative.
The former minister told the court, presided over by Justice John Ajet-Nasam, that the accused person presented a bid on behalf of Vamed Engineering on July 4, 2005 and signed as the local representative of the company.
Vamed Engineering was among a total of 70 companies which bid for the stadium but the procurement process was cancelled as Shanghai Construction Company Limited was willing to construct the stadia at a lesser cost because the government had decided not to exceed an amount of $40 million for each of the two projects.
Mr. Osafo-Maafo said he later wrote a letter to the Public Procurement Agency (PPA) and requested to do sole sourcing for the stadium project in view of the time constraint and the need to meet the CAF deadline.
The witness said the PPA gave approval to the sole sourcing and subsequently Shanghai Construction Limited which quoted $38.5 million for each of the two projects was awarded the contract.
Earlier, the court, overruled the defence team’s objection to the tendering of photocopies of documents in the case.
Answering questions under cross examination from lead counsel for Woyome, Mr. Sarfo Buabeng, the witness told the court that he had known Woyome from 2001 when he (Woyome) represented a foreign company in the construction of three hospitals in the country.
According to Mr. Osafo-Maafo, the accused person acted as the facilitator to raise additional funds at the banks for the hospital projects.
He said he also informed his colleagues during a cabinet retreat which cancelled the tender process for the award of contract for the stadium on the need to follow due procedure.
The former minister said due process was followed when the contract was awarded through sole sourcing.
He disagreed with counsel’s suggestion that cabinet acted in contravention of the Public Procurement Act (PPA) when it decided to call off the tender process.
Hearing continues on July 23, 2012.