The Vice President of the Republic, Dr Mahamudu Bawumia, has charged stakeholders in the construction value chain to undertake a comprehensive value-for-money analysis to ensure that Ghanaians get absolute value for every pesewa spent.
Citing figures which show that Government contracts are usually several times higher than that of the private sector, the Vice President challenged stakeholders and participants at a Value for Money Conference in Accra to urgently develop and propose strategies that will help government to put an end to the practice, particularly in the construction of Roads, Hospitals and Schools.
In this regard a committee of key stakeholders, to be chaired by the Senior Minister, will soon be put together to draw up cost and specification standards to guide government procurement and construction.
Speaking at the Conference, held in Accra on Monday June 25, 2018, Dr. Mahamudu Bawumia said a review of a number of government contracts has revealed a vast disparity in the cost of projects undertaken by the private sector and government.
“At a recent meeting of the EMT, it emerged that Ghana constructs 60-80 bed district hospitals for $25 million! You will hear today that the African Development Bank constructed a 150 bed hospital in Accra for some GHC5.76 million or $1.3 million without equipment. Even if we have to equip this hospital for some $1 million, the total cost cannot get to more than $3 million. So how come we are building district hospitals for $25 million, a figure which even excludes the tax exemptions granted on equipment imported for the hospitals? So for one hospital that Ghana is currently constructing, we could have built and equipped 6 hospitals” Dr Bawumia indicated.
“According to some estimates, if Dangote can build a 1000 bed capacity for nearly under $20 million, it begs the question why Ghana builds an even smaller capacity (about 400-bed facility) for nearly $300 million. Something is not right here,” the Vice President said.
While it is imperative that government seeks suitable investment opportunities to meet the infrastructure gap, it is also important that Government takes steps to ensure cost efficient program design and delivery to reduce financial wastage and protect the public purse, Vice President Bawumia underscored.
“The Wold Bank estimates that on average, Ghana invests approximately $1.2bn per year in Infrastructure projects. The Africa Infrastructure Diagnostic Report in 2010 (AICD) also identified that $1.1bn is lost each year, in Ghana, on Infrastructure projects due to project delivery inefficiencies and for Ghana to meet its infrastructure deficit, $1.5bn is required, each year for the next 10 years”.
Vice President Bawumia charged the participants, including Senior Minister Hon Yaw Osafo Maafo, Finance Minister Ken Ofori-Atta, Education Minister Hon Mathew Opoku Prempeh and Procurement Minister Hon Sarah Adwoa Safo, to deliberate and come up with solutions that would influence Government policy on procurement and construction to prevent waste of taxpayer and donor funds.
Among others, there were presentations from representatives of the Ministries of Health, Education and Roads; the Construction Sector of the Association of Ghana Industries; Ghana Standards Authority; the Church of Pentecost; MTN Foundation; the Apollo Group from India; the World Bank and the African Development Bank, and Barima Dr Ofori Ameyaw, CEO of Georgeland Construction, the company that constructed the structure meant to eventually house the Ofankor District Hospital.