The Ghana Irrigation Development Authority (GIDA) has disclosed that the $12 million paid to the contractor undertaking the Pwalugu Multipurpose Irrigation Dam project was for mobilisation, not final work.
This was contained in a statement issued by GIDA.
It explained that the payment formed part of the terms of the contract that required the contractor, Messrs Power Construction Corporation of China (POWERCHINA), to be paid a total sum of $11.9 million as a mobilisation fee once the contractor was able to provide “advance payment guarantee from a reputable bank.”
The statement said the government was at no point, at risk by approving the payment and that “contrary to the claim that no work has been done, the contractor has delivered both preconstruction documents and some physical works (camp and access roads).”
Minority members of Parliament’s Works and Housing Committee raised concerns over the payment and visited the project site last week to inspect the progress of the work done.
The caucus called for an investigation into the matter.
The Member of Parliament for Bongo, Edward Bawa, called for the prosecution of all persons involved in the approval of the $12 million payment.
But GIDA maintained that “no frivolous payments have been made, and the USD11.9 million paid to the contractor was fully covered by a Bank Guarantee valued at USD60.7 million. All payments made were for specific activities executed under contract.”
“Under the contract, the Government was expected to pay USD 48,570,889.69 million (which constitutes 12% of the total contract sum of USD 404,757,414.06) as mobilisation to the contractor subject to the provision of an advance payment guarantee from a reputable bank.
“Following the receipt of the advance payment guarantee with face value of USD 60,713,612.11 from the contractor’s bankers (Stanbic Bank), an amount of USD 11,949,088.06 (25% of the total advance mobilisation required ) was paid in three tranches.”
By: Rainbowradioonline.com/Ghana
