Abrogation of PDS contract bold

In the past 96 hours and counting, the country‘s attention has been focused on issues surrounding the abrogation of the contract between the Government of Ghana and the Power Distribution Services (PDS).

The brouhaha has dominated the headlines in the print, electronic and social media, bringing the name of the country into international limelight.

The discussions on PDS have attracted mixed comments from the political divide and civil society, either side stating its stance on the move by the government to take such a delicate decision to abrogate a sensitive contract.

Since the announcement of the government’s intention to sever contractual relations with PDS, the United States government, which backed the need for the country to allow private sector participation in the energy distribution sector, has withdrawn its support to the tune of $190 million, as pledged under the Millennium Challenge Account (MCA) Compact II.

It sounds strange to many that the US will condone irregularities in any contract in which it has interest, but the government has indicated that it has discovered a significant number of contractual breaches in the deal with PDS, for which reason it can no longer allow the contract to hold.

Gauging the mood and opinions of the public, the Daily Graphic has observed that, for once, even the biggest opposition party and prominent civil society organisations side with the action taken by the government to end the contract with PDS.

We find the decision by the government bold and refreshing, even in the face of pressure from the US for it to reverse that decision.

Many a government would have succumbed to that pressure because of the grant thrown at it, a situation which could easily have spelt doom for the country in the long run.

It is our hope that the government did all it takes to properly evaluate and conduct thorough due diligence into the contract and identified significant breaches that do not make it comfortable to risk the over $3-billion assets of a very prominent state institution.

The paper is aware that the Electricity Company of Ghana (ECG) has been made to take over the assets of the company and run it until a new concessionaire is found to take over.

While that process is about to begin, we would want to sound a caution to the management of the ECG not to do anything to reverse the gains made under the previous administration, particularly with regard to revenue generation and ensuring efficiency in the running of the business.

The very acts of mismanagement, misapplication of funds, inefficiencies, among many other lapses, should be things of the past for good.

We are also aware that the decision taken by the government will come with many repercussions and consequences which, if not properly addressed, can create more problems for the state.

It is against this background that we would want to entreat all and sundry to stand firm with the government in these trying times and in its quest to protect a key state asset.

We are mindful of the pledge by the President to ensure that all state force is used to protect national assets.

As a nation, there are some critical issues which do not deserve politicisation because doing so can affect decisions that could have meant good for all.

Again, we would want the very bitter experiences in this deal to serve as a big learning curve to our governments to ensure that in the future they carry out due diligence on every contract before it is sealed.

Failure to do so will result in ‘firefighting’, which can have grievous consequences on us all. As the US said, the sanctity of contracts is crucial and the government must not lose sight of that fact in the future.

It is our expectation that frantic efforts will be made in due course to find a credible replacement for PDS to end this rather regrettable chapter in the annals of our dear country.