Government Holds Value for Money Conference in Accra

By Rex Mainoo Yeboah

Stakeholders in the construction industry value chain have been urged to undertake a comprehensive value-for-money analysis and to urgently develop and propose strategies that will help put an end to the practice of inflated government contracts.

Dr Mahamudu Bawumia, Vice President of the Republic of Ghana, who made the call at a Value-for-Money Conference in Accra on Monday, disclosed that a review of a number of government contracts had revealed a vast disparity in the cost of projects undertaken by the private sector and government.

Dr Mahamudu Bawumia cited figures to show that Government contracts were usually several times higher than that of the private sector, adding that while it was imperative that government sought suitable investment opportunities to meet the infrastructure gap, it was also important that government should take steps to ensure cost efficient program design and delivery to reduce financial wastage and protect the public purse.

He said World Bank estimates indicated that that on average, Ghana invested approximately US$1.2bn per year into infrastructure projects while the Africa Infrastructure Diagnostic Report in 2010 (AICD) also identified that US$1.1bn was lost each year in Ghana on infrastructure projects due to project delivery inefficiencies.

Furthermore, he said, at a recent meeting of the EMT, it emerged that Ghana constructed 60-80-bed district hospitals for US$25 million while the African Development Bank constructed a 150 bed hospital in Accra for some GHC5.76 million or US $1.3 million without equipment.

"Even if we have to equip this hospital for some US $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.

Vice President Bawumia, therefore, charged the participants to deliberate and come up with solutions that would influence government policy on procurement and construction to prevent waste of taxpayer and donor funds.

He disclosed that a committee of key stakeholders, to be chaired by Hon. Yaw Osafo Maafo, Senior Minister, would soon be put together to draw up cost and specification standards to guide government procurement and construction.

Present at the meeting were Hon. Yaw Osafo Maafo, Senior Minister; Mr Ken Ofori-Atta, Finance Minister; Mr Mathew Opoku Prempeh, Education Minister; and Mad. Sarah Adwoa Safo, Procurement Minister.

Also present were representatives from the Ministries of Health, Education and Roads; the Construction Sector of the Association of Ghana Industries; Ghana Standards Authority; Church of Pentecost; MTN Foundation; Apollo Group from India; 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.

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