Statement :Gov’t Should Stop Crowding Out Private Construction Industry with So-called ‘Affordable’ Housing- And Cause Audit into Multi-Billion Dollar Spending – ATJAG

The Alliance for Truth, Justice and Accountability Ghana(ATJAG) is calling on the government of Ghana to Stop Crowding Out Private Construction Industry with So-called ‘Affordable’ Housing- And Cause Audit into Multi-Billion Dollar Spending. Below is the full statement copied this portal:

1. The Alliance for Truth, Justice and Accountability has been studying with some disquiet news that the government of Ghana is again contemplating the construction of between 100,000 to 250,000 new ‘affordable housing units’ every year to provide ‘affordable residential accommodation’ for public and civil servants.
2. The news of the new construction was made known by Mrs. Freda Prempeh, Minister of State in charge of Works and Housing in April this year when a delegation from the State Housing Company (SHC) inspected acres of land secured by the SHC to start the ‘affordable housing project’ in the Ahafo Region.
3. The information has since been repeated by the Minister for Works and Housing, Francis Assenso Boakye.
4. The Alliance for Truth, Justice and Accountability is firmly opposed to the news for a number of good reasons.
5. First and foremost, housing in this country has traditionally been provided by the private sector, at no cost to government. Even though government has made a number of interventions in the sector since colonial days, the effort comes nowhere near the stupendous industry demonstrated by individuals and companies who largely provide housing for the populace with their own resources. We believe that any interventions in the housing sector should therefore be aimed at improving the abilities of the private sector in that direction.
6. Our second reason for opposing the idea of the new government construction is that, without doubt, the adventure would be fueled by yet another public debt. We are at odds to understand the rational for accumulating further public debt for an industry that people engage in without loading government with further debt. The so-called ‘housing gap’ in the country has always been filled by the private sector.
The third reason for our objection is that the public debt that Ghana keeps on accumulating is to be paid for by the private sector, through taxes. This, in effect, means that the private companies in the housing sector would have to pay for the 1. activities of the public sector. In effect, the private housing sector is going to have to pay government so that government can go into competition with it.
8. The fourth reason is the concept of competition itself. The duty of government is to create an enabling environment for the private sector, including the private construction industry. Over the past decades, going back into the era of Osagyefo Dr. Kwame Nkrumah and right up to the present under President Akufo-Addo, there has been a systematic lack of governmental interest in helping the private sector in the housing sector to grow. Government has not been heard, across the period, on what policies and programs it intends to implement to help the private sector in the housing industry to grow and acquire the strength to provide adequate housing. Rather, government across the period is constantly heard competing with the private sector space, and crowding out the private sector. Government is in competition with the private sector, and it is the private sector that has to pay for the fun of government in this unprovoked competition.
9. Fifth, the so-called ‘affordable housing projects’ can never be said to be affordable. Many of the units are priced in the tens of thousands of dollars, well beyond the means of the ordinary teacher or nurse. Unlike units provided by the private sector, these ‘affordable units’, from day one, have been priced, due to inherent corruption, out of the pockets of the people who have to patronize them.
10.Sixth, the direct result of the previous point is that virtually all the housing sites so far built have been abandoned. It makes very little economic sense to borrow and tax to build housing units like Saglemi, only to abandon it, the worse of it, call on the private sector to pay for the fund.
11.Seventh, there is total lack of transparency in contracts for affordable housing projects. The drawings, quantities, pricing and securing the finance among other factors remain under a veil of lack of transparency, and as a result, a nation that cannot build schools and hospitals has to keep on spending hundreds of millions of dollars putting up these white elephants, which are often constructed in far-off locations that makes living in them, transportation and other logistical nightmare, leading consequently to their being abandoned.
12.Again, the contracts for these projects are largely for the benefit of foreign companies. This means that while the private sector pays for the adventure, it does not benefit from the economic and financial activity. As a consequence, hundreds if not billions of dollars, are being funneled out of the country to enrich foreign companies and individuals to the detriment of local companies.
SAGLEMI
13.At Saglemi, for instance, 1502 flats, the first phase of the 5,000 housing units at Saglemi in the NingoPrampram District, has been left to rot away. Ghanaians paid $200 million dollars for the fund, and are being called upon to bring up an additional $35 million dollars, which, without doubt, would also disappear.
14.The former Minister of Housing, Samuel Atta Akyea revealed that former NDC government officials involved in the botched Saglemi Housing deal embezzled more than $114 million of the $179.9 million paid to the contractor. Former Minister and MP Collins Dauda presided over this infamy. The Akufo Addo administration has not prosecuted a single person for this crime against the people of Ghana. It is rather pumping in more money, and only God knows what is going to happen.
ASOKORE MAMPONG
15. Another of the misadventure is the affordable houses at Asokore Mampong, in the Ashanti region.
16.The affordable housing project in Asokore Mampong is one of the Government’s affordable housing projects under the Social Security and National Insurance Trust (SSNIT). The project consists of 91 apartment blocks that contain 1 bedroom, 2 bedroom and 3 bedroom apartments which are estimated to house over 1000 people.
17.There have been issues raised about the prices of the affordable housing apartments which stand at GHS
99,000 – GHS 142,500 for a 1 bedroom apartment, GHS 182,500 for a 2 bedroom apartment and GHS 335,000 for a 3 bedroom apartment. This was disclosed by the Deputy Minister for Works and Housing during an interview.
18.This project is targeted at civil servants. Sale of apartments was scheduled to commence in March, 2020 but no information has been communicated to that effect as at May, 2021. because nobody is prepared to pay that type of money to live in crowded tenement buildings when one can, for the same money, put up a four bedroom house with its own compound.
AMASAMAN
19.The Amasaman affordable housing project was funded by the United Nations Office for Project Service (UNOPS). UNOPS is expected to build over 850,000 homes across Asia, Africa, and the Caribbean.
20.The Amasaman affordable housing project is expected to produce 6,500 homes at the value of over $5.3 billion. This puts the price of each home around $800, 000.00 (eight hundred thousand dollars) or about GHc3.9 million (three million, nine hundred thousand cedis). Whether any Ghanaian would use that type of money to live in crowded conditions in what essentially is a high-rise tenement remains to be seen. It was launched by Vice President Mahamudu Bawumia in 2019.
NEED TO BE VERY WORRIED
21.The astronomical waste and financial scandal exampled by the three projects above should give all Ghanaians great course for concern, and the idea that government is contemplating building an additional 100,000 housing units under the conditions of such multi-billion dollar waste should be a matter of concern for all.
CONCLUSION
22.Under the circumstances, we call on government to do the following.
(1) Cause an immediate halt to the 100,000 housing project in the Bono Region.
(2) Investigate the cause of the white elephants at Saglemi and Asokore Mampong.
(3) The financial feasibility of the Amasaman Project.
(4) Immediate financial audit of all on-going affordable housing projects;
(5) To tell Ghanaians the complete facts on the $5.3 billion UNOPS project, where the money is coming from, and what are the conditions attached and whether it has received parliamentary approval;
(6) Cause an immediate value-for-money audit of the UNOPS project, since the money allegedly being spent should be able to build tens of thousands more houses;
(7) Complete abandoned affordable housing projects.
(8) Immediate engagement with the relevant real estate associations in Ghana on how government can assist them to produce economically, viable, affordable houses in Ghana. Such engagement should not move beyond the area of policy assistance and certainly NOT include a cedi of taxpayer’s money. We shall be back soon on Part Two of this statement
Signed …………..
Bismark Kofi Boateng Convener
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