In what has been described as a deal drenched in corruption, the Minority Leader in Parliament, Osei Kyei-Mensa-Bonsu, has stated that the Mills-Mahama NDC administration’s decision to purchase 5 aircrafts, related logistics and the construction of a hangar at total cost of US$105,370,177.09 is bubbling with tonnes of shady dealings. Out of this more than 56% of the total cost, representing in real terms US$59 million, seems to be money going into individual pockets.
The minority leader re-echoed these sentiments, he made on the floor of parliament Wednesday, yesterday, Thursday, in an interview with Accra-based radio station, Peace FM. Parliament on Wednesday approved the loan deal with the Brazilian Development Bank (BNDES) for the purchase of one Embraer 190 Aircraft from Brazil, two new CASA 295 turboprop aircrafts, and two Diamond surveillance and training aircrafts.
According to the Minority Leader, the speedy nature with which President Mills ordered the approval of this loan agreement leaves much to be desired. He stated that, the President on 21 st of June 2011, gave executive approval, just as with the STX deal, without cabinet approval after the Attorney General had provided his legal opinion on the same day.
Within two days, on 23 rd June 2011, the Ministers for Finance and Defence rushed the deal to parliament, where because of their numbers in parliament, they bulldozed their way and approved the agreement.
According to the Minority Leader the basic price for the Embraer 190 is quoted at $32 million on the website. However, the agreement presented by the Minister quoted the price at $55 million, representing a 72% inflation of the price.
He added that the specifications of the Embraer 190, includes a cabin height of 2 metres, cabin width of 2.74 metres, baggage volume of 21.17 m 3 , a fuel tank capacity of 4,268 gallons.
“What the website of the manufacturer tells is that so far, 410 of these aircrafts have been ordered / sold. Countries such as the United Arab Emirates, Jordan and Poland have bought this plane at the basic price of $32 million. So why would Ghana’s shell price of a plane, just as the ones purchased by other countries, be quoted as $55 million?
Again, the Minority Leader also quoted $22 million as the basic cost of one CASA 295 military transport aircraft as against €24.522 million or over $35 million given by government, an inflated cost by 59%.
“It seems there is a deliberate attempt to milk this nation of its scare resources. Why would the government inflate the prices of aircrafts if not for the sole reason that some people want to fill their pockets? This smacks of grand corruption in government”, the Minority leader said.
The Minority Leader also wondered why government used sole sourcing in its application of the loan. Quoting section 40 of the Procurement Act, he said the conditions under which sole sourcing could be resorted to, include urgent need and in catastrophic events.
The Minister of Defence, Lt. Gen. J. H. Smith, also stated that a hangar at the cost of $17 million dollars was to be constructed to house the aircrafts. According to the Minority Leader, the Defence Minister stated at a committee level meeting that the hangar would accommodate 2 aircrafts. However, when probed further on the floor of parliament, the Minister backtracked stating that the hangar was rather going to house 3 aircrafts.
“Our checks indicate that a hangar costs within the region of $4 to $7 million dollars. So why would government once again inflate the price? The figures quoted are very suspicious, we smell a rat in this agreement, we smell a torn umbrella in this agreement”, he added.
Terms of the agreement include, a finance amount of US$88,370.177.07 for aircrafts and logistics, export credit of 85 per cent from BNDES amounting to US$73,370,177.09 including export credit BNDES Insurance of US$4,520,177.09.
It has a repayment period of 10 years and a grace period of one and half years with interest rate of CIRR-2+1.05 per cent, structuring fee of US$0.50 flat and a commitment fee of 0.50 per cent per annum.
It is recalled that in March 2008, the flag bearer of the National Democratic Congress (NDC), Prof. Atta-Mills stated the purchase of two presidential jets by the government was a misplaced priority.
“This is not the time for it. Now there is a turn around to buy two jets at a time when people cannot even get water, when things are indeed more difficult to attain. We must be more sensitive than we are. We must be more selfless than we have been. Nothing should take precedence over the welfare of the people who voted you into power” .
In his first state of the nation address in February 2009, President Atta Mills promised to impose “austerity measures” after replacing the New Patriotic Party (NPP) in power.
“As part of these measures we will review the decision to purchase two executive presidential aircrafts. Ghana simply cannot afford the expenditure at this time and we certainly do not need two presidential jets.”
The Minority leader, Hon. Alban Bagbin, at the time stated that the quality of life of most Ghanaians then (that is 2008) was worse than it was in 1999-2000 as shown by the UNDP 2007 human development index. Continued…
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