Full Report: ECG management’s negligence led to GHS 909m demurrage losses – Investigation reveals

The government-appointed technical committee has uncovered massive procurement irregularities and financial mismanagement at the Electricity Company of Ghana (ECG), leading to losses worth hundreds of millions of cedis.

The report, submitted to the Ministry of Energy & Green Transition, found that ECG management’s negligence directly caused a backlog of containers at the Tema Port, resulting in over GHS 909 million in demurrage charges.

According to the report, contrary to claims of financial constraints, the investigation found no evidence supporting ECG’s justification for failing to clear the containers.

The committee identified over-procurement as a major issue, worsened in 2023 when the Procurement Directorate was merged with the Premises & Estates Directorate. The Director of Procurement, Premises & Estates admitted that most of the stranded containers were procured under his tenure and acknowledged that ECG acquired more materials than needed due to pressure and influence from top management, particularly the then-Managing Director.

The report states that the former MD awarded contracts to specific suppliers without following competitive procurement processes, leading to excessive spending. This mismanagement resulted in ECG exceeding its 2023 procurement budget by billions of cedis.

The report revealed that investigators also revealed that 1,346 containers, valued at over USD 489 million, remain unaccounted for, including high-value equipment like transformers.

Read Also: ECG overspent GHS 7.3bn in 2023 due to unapproved purchases – Report on ECG scandal

“Despite ECG’s claim of financial difficulties, the company awarded and pre-financed a clearing contract worth GHS 30 million to Mint Logistics Ltd while failing to clear essential equipment.”

“Additionally, a clearing contract worth GHS 127.65 million was awarded to a company that was not a registered Customs House Agent, even though ECG is a self-declarant capable of handling its own shipments.“

“Another company, Dawards Bond Ltd., fraudulently cleared 47 containers without paying the required duties and delivered only 46 to ECG. The company now demands GHS 5.29 million for services rendered, while the evaded taxes on these shipments amount to nearly GHS 4.8 million.”

The report suggests that the port backlog was deliberately created to justify awarding third-party clearing contracts totaling GHS 159.65 million, despite ECG having a fully functional shipping unit capable of handling the process internally.

Below is the full report on the ECG scandal:

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