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Editorial News of Thursday, 12 May 2005

Source: lens

EDITORIAL: United Rail ?Matters Arising

The NPP Government?s offer of the Ghana Railway Company (GRC) to the phantom United Rail International through the mechanism of the equally dubious United Rail (Ghana) Ltd (URG) is nothing more than that our elected leaders have ?made a gift? of a multi-million dollar contract to a corporate entity that is nothing more than a shell without assets.

As yet, Ghanaian taxpayers who are funding the contract have not been told what qualifications this ?shell company? has that justifies the award of so large and important a contract, the performance under which will touch and affect all of us for generations to come.

In view of the obvious importance of this United Rail International/United Rail (Ghana) matter to the average citizen, it would be useful to look at the issue like any major purchase that an individual might contemplate.

We may not be experts in these matters, but we do have a measure of common sense. And our common sense tells us that this contract is not intended to benefit this country as a whole. It really seems to be no more than a transfer of our money to a paper corporation without assets, without experience, without competence and without identity.

Public contracting is different from a private contract that one enters into to purchase say land, a car or even the labour of another. Government contracts are rightfully subjected to more exacting scrutiny than their private counterparts.

Government contracting officials lack incentives similar to what is available to their private sector counterparts, that is, profit, to make contracting choices that maximise the interests of their principals, that is, the taxpayers. This is where the public has to step in.

When our employees, these same Government officials, make poor contracting choices, we have to reverse these choices when and where possible. Moreover, when the process by which a contract is awarded is flawed, as when a ?shell company? that has no assets is ?awarded? a contract, attention should be given to setting right the contracting process to ensure that it is fair and serves the public and not an individual Government Minister or a group of Government Ministers.

Government contracting processes should attain the highest degree of integrity. The Government stands on a different footing from other contracting parties because it uses public funds and is accountable to all citizens. It is an insult to all of us, those of us outside government and those engaged in serving the public from within the government, to simply ?make a gift? of a Government contract to an entity like the United Rail (International).

It seems clear that if the average man, or even the man of means, looks at the URI/URG/GRC negotiations, he will ask himself the following questions:

(i) How was the contract put out for bids?

(ii) What basic qualifications did a company have to demonstrate before it was determined to be eligible to bid for the contract?

(iii) What ?due diligence? was done on the interested companies?

(iv) Which Government officials conducted the ?due diligence? investigation of the companies?

(v) What steps were taken to ensure that the selecting officials did not have any conflict of interest with regard to the selected company?

(vi) What information or evidence served as the basis for the decision to select URI as opposed to any others?

(vii) What financial and performance guarantees have been provided by the United Rail (International)?

Our only interest is that we have a fair process that we can all understand; that we have a competent company working for us; and that our money will be well spent, that is, that we end up with a rail system that will serve our country well in the future.

Knowing what we know today about the ?shell company or companies? that have been offered the contract, be they United Rail (Ghana) Limited, United Rail International, Trackbed, Trackbed (UK) Ltd, Trackbed Foundation, Holdtrade (UK) Ltd, Holdtrade Mining Ltd or whatever, no reasonable person can answer any of these questions with anything other than a resounding No!

We are being asked to simply give away our money without even a minimal assurance that we will ultimately receive something of value in return. Just look at the metamorphosis through which the so-called URG has gone through to get to the present stage of negotiations.

The Company has behaved in amoebic fashion, changing shape as and when the Ghanaian media has challenged it.

The Minister of Ports, Harbours and Railways told us that United Rail (Ghana) was owned 100% by United Rail International) (UK) and that United Rail International was owned 50%-50% by Trackbed and Holdtrade (UK) Ltd.

The Ghanaian media checked and established that the only Trackbed Company registered by the UK Company house, Trackbed Consolidation Ltd, was dissolved on October 19, 2004.

The Minister and his UK acolyte, Matthew Bruce Burrows, quickly backtracked. The company in question, they said, was rather Trackbed Foundation, a multi-billion dollar private Foundation registered in the Isle of Man and financing major projects in Africa.

We published the details of this phoney shell Foundation in our edition of last Tuesday. In sum, the total share capital of The Trackbed Foundation is ?100. The maximum liability of each shareholder is ?10. So far, only two shares of the Foundation have been subscribed at a total value of ?2. Yet this is the Foundation that is supposed to bankroll the multi-million dollar GRC rehabilitation project.

With regard to the other shareholder, Holdtrade (UK) Ltd, the Ghanaian media quickly found out that it was simply a commissioned agent in Ghana for the sale of the products of the UK-based Company, Clayton Equipment Company Ltd.

Again the Minister and his acolyte, Matthew Bruce Burrows, did an about turn. No, it was not Holdtrade (UK) Ltd, they said, but Holdtrade Mining Ltd to which Holdtrade (UK) had assigned its rights in Ghana and which had been working on the Western rail line.

A little digging by ?Ghana Palaver? revealed that Holdtrade Mining Ltd is owned 40% by Oscar Rettenmund, 20% BY Franklin Roberts, both boyhood friends of the NPP Minister of Tourism and Modernisation of the Capital City, Mr. Jake Obetsebi-Lamptey, and the remaining 40% by Holdtrade (UK) Ltd.

When the technical competence of the URI was challenged, the Minister and his acolyte, Matthew Bruce Burrows, quickly said that after all, United Rail (Ghana) was not a company but a Consortium of three companies ? United Rail (International), Trackbed Foundation, and RailRoad Development Corporation of the USA (RRDC). However, they said, RRDC was not yet a partner but would become a partner after URG had won the bid.

We are not yet talking about the changing Directors, the changing Secretaries, the obviously forged and fictitious signatories, and all the indicators of a financial scam associated with this URI deal, clearly on all fours with other proven NPP Government scams such as the abortive IFC and CNTCI loans and the unfolding Ghana International Airlines (GIA) scam at Ghana Airways.

Our view is that if you do not mind giving away your money with no demonstrable basis for believing that you will ever receive anything in return, then the URI deal should suit you fine.

If, on the other hand, you appreciate the value of your hard earned money, think that our Government should be held to a high degree of accountability in financial matters, are curious about a process in which a ?shell company? can be given a multi-million dollar government contract, want a rail system that will be constructed by a reliable company and works, and, simply want to have a government that respects the people that it is supposed to serve enough to fairly award contracts, you will want to make sure that URI is not awarded the Ghana Railway Company contract and that the negotiations are terminated forthwith.

The people of Ghana deserve a real contract that serves the nation, not just the few.