Feature Article of Monday, 27 February 2012
Columnist: Casely-Hayford, Sydney
By Sydney Casely-Hayford, Sydney@bizghana.com
As far back as July 2009 I wrote a piece on the Quality Grain Rice saga, which triggered a $22million loss to the Government of Ghana. I wrote that piece under a series which I themed “A Guide to Corruption”. The link to the article is here. http://www.modernghana.com/news/230489/1/a-guide-to-corruption-in-ghana.html
When Mr. Atta Mills was made Vice President and put in charge of the economic management team, he inherited the Quality Grain Rice project. He later testified to a court presided over by Justice D. K. Afreh in April 2003, that “ …. throughout my four years as vice president, there was no project which occupied more of my time than this Quality Grain Project”.
There were many red flags all over the case at the time and they were all ignored. The government failed to join in several suits against Ms. Cotton. They (Government) did not accept the FBI's (who finally prosecuted and jailed Ms. Cotton in the USA) invitation to sue Ms. Cotton. Prof. Mills said the reason for inaction was because the Government “had a “trump” card” – a deed of indemnity and a floating charge on assets.
But due to poor oversight, the floating charge was never registered and therefore void under Section 107(1) of Act 179 and the terms of the indemnity were never enforced. Rather, the government gave Ms. Cotton more millions (at that time $2million) without parliamentary approval.
A former Governor of the Bank of Ghana, Dr. G.K. Agama complained about the legal department in the Ministry of Finance, which had usurped the role of the solicitor-general as advisor to the Bank. He wrote to former Attorney General Obed Asamoah to review the process of approving foreign loans for government as required under Section 48(2) of the 1992 Bank of Ghana PNDC Law 225, which ensures that all relevant cabinet/parliamentary and other approvals had been obtained by the minister of finance. The Finance Minister ignored the A-G even after he had been formally informed of the complaint.
Both the A-G and Governor were powerless to make the proper corrections. Then Vice President Mills had all the facts, spent a large dose of his time on the project, by his own admission, but still overlooked all the glaring loopholes in the project. He allowed political expediency and other pressures to blind-side him into making poor judgment calls.
The Bank of Ghana and the Attorney General as institutions with authority to trap such attempts to by-pass the laws of foreign borrowing were powerless in the face of the legal department within the finance department, (which should not have been there in the first place) to flex their regulatory authority. At the time no one could bell the “old man” (in that instance JJ Rawlings). This deadly cocktail of poor oversight, weak institutions, fear of the “old man” and self-serving politics is our corruption problem. There will always be corruptible elements in society. We have the laws in place and we do not apply them. Ghanaians will also recall that once Finance Minister Dr. Kwesi Botchway resigned his position and complained bitterly about the role of Mr. Tstatsu Tsikata regarding finance issues in Government. His complains were ignored by JJ Rawlings. The Quality Grain Rice fraud happened during a (P)NDC) government and oversight directly involved now President Mills. Several ministers of Government were jailed for the offence under the NPP. By his own admission President Mills was involved directly in the case.
The Woyome saga is turning out to be the same. By his own disclosure, he tied to intervene and by his own actions he has failed to finger the culprits in the case.
There was a certain dis-ingenuousness in the State of The Nation Address by the omission of the Agbesi Woyome case in the President’s corruption content. No other issue dominated the Nation’s corruption landscape more than the Woyome saga in the run up to the address. His tacit omission of the scandal indicates a lack of respect for Ghanaians. President Mills cannot say that he was not aware that all Ghana wanted to hear how he would factor in the Woyome alleged corruption.
Yet he has been on air several times since to declare that when it comes to corruption he does not care whose “ox is gored”. Moves to investigate other payments and extend the investigation to dates before Agbesi Woyome was paid ghc52million are a necessary event for Ghana.
It must be done and done thoroughly, not for any reason than that the recently completed 14.2km Millennium Challenge (MCA) George Walker Bush Highway from Tetteh Quarshie to Mallam and the great interchange that has made my life a real joy (I live on McCarthy Hill) and confused the taxis and trotro drivers because the road lanes are marked, cost less than $300million. Where has all the borrowed money ended up? If we are going to look back and examine the costs of most of these major contracts including that which has ended in judgment debts, let’s look forward as well and borrow a template from the MCA.
The MCA project worked because of some simple factors. Project funds were in place for the whole duration. An Authority administered the fund with no interference from Government. There was a finite deadline for completion with penalties for delay and rewards for early completion. The identity of the project managers and contractors was no secret. Government did not need to provide counterpart funding. Finally, a Monitoring Unit with periodic audits and reporting made payments on certification. Localise the formula and repeat it several times over, we will have more highways completed to international standards and no complaints of corruption. So here is my corruption guide and how it works.
You need a cocktail of; poor oversight, lack of attention to detail by a high level politician, the ability to circumvent and re-interpret the rules and laws of Parliament and the belief that someone higher than you on the political food chain who can affect your position is involved in one way or another. Lastly, a dash of fear of losing your small “chop-chop” position. It is even easier if you usurp another government institution's job.
Ms Cotton nearly got away with it all in the Quality Grain Rice case, if not for the fact that the EXIM bank was involved, it was a federal crime in the USA, the FBI investigated and she was prosecuted for the crime against the government of Ghana and the USA. These were two institutions of the USA who did this. In this Woyome scandal the three pillars we are counting on in Ghana are the Auditor-General, the Courts of Ghana and the Public Accounts Committee of Parliament (PAC). The Auditor has done his job, albeit with a limp hand, now we look to the PAC and the Court.
The net must stretch across the Ministry of Finance, the Courts, Controller and Accountant General, Attorney General, all political parties, Traditional leaders and NGO’s who received “stolen goods”.
That is the law and that is how it must be applied. Thoroughly, completely, continuously and based on good evidence.
President Mills does not have the fortitude to see this challenge through because he is looking into a political crystal bowl. In the past his attention to financial matters has fallen short of diligent standards. He has neither seen nor taken up the bigger challenge when he should have and there is no evidence in the recent past that he will do different.