Cabinet approved judgment debt payment to Construction Pioneers – ex AG

Contrary to reports that the office of the Attorney General and Ministry of Justice made payments of judgment debt to a private company; Construction Pioneers without cabinet approval, a cabinet directive cited by the Daily Graphic dated July 19, 2013 gave approval for the payments to be made.

Checks by the Daily Graphic also revealed that even though the directive from Cabinet was in 2013 and all formalities concluded in 2013, the Ministry of Finance did not effect full payment until 2014/2015.

The 2016 Auditor General’s Report has indicated that an amount of GH¢67,380,718.20 was paid Construction Pioneers in 2015 by the Attorney General without recourse to cabinet.

The report also points out that a review of the bank statement of the Justice Ministry by the Auditor General uncovered a payment of GH¢67,380,718.20 (direct debit) was made to Construction Pioneers as judgement debt on behalf of the state without any reference to cabinet.

However, the Cabinet memo stated that at the eighth Cabinet Meeting which was held on July 25, 2013, Cabinet considered a memorandum by the Attorney General and Ministry of Justice requesting for approval for the payment of a negotiated sum owed to Construction Pioneers.

“After discussing the memorandum, Cabinet gave approval to the request”, the memo added.

The then Minister of Justice, Marietta Brew Appiah-Opong in a memorandum dated April 19, 2013 requested Cabinet to consider and approve the payment of the outstanding balance of €16, 420,000 being the instalments due on March 31, 2012 and 30th June 2012, interest on the said sum as well as interest on delayed payment of earlier instalments.

This was pursuant to the Settlement Agreement dated March 18, 2010 executed between the then Attorney-General, Betty Mould-Iddrisu and Construction Pioneers.

Cabinet in response to the memorandum directed the AG to invite Construction Pioneers for an agreeable term of settlement; this was contained in a second Cabinet Memo dated May 17, 2013 which has also been cited by Daily Graphic.

After negotiations the agreeable amount for payment by the Government of Ghana was £18, 455,303.94 which was paid in 2015 after Cabinet’s approval.

Background
The said request for arbitration is borne out of a Settlement Agreement executed between Government of Ghana (GoG) and CP construction Pioneers (CP) on March 18, 2010, by which the parties arrived at a global settlement of all GoG’s indebtedness to CP Construction Pioneers.

Per the terms of the Settlement Agreement, GoG undertook to pay to CP a global amount of €94 million out of which an amount of €14 million had already been paid in 2009. The outstanding sum of €80 million was to be retired in ten monthly instalments of principal and interest commencing on March 31, 2010 and ending on June 30, 2012.

The parties also agreed that in the event that any payment is made after the due date then GoG would be liable to pay additional interest.

The Ministry of Finance and Economic Planning suspended payments in 2012 of the two final instalments as it sought advice from the then Attorney-General on whether to pay or not in view of the hearings into the Settlement Agreement by the Public Accounts Committee of Parliament.

Betty Mould-Iddrisu referred the issue to the Chairman of the Public Accounts Committee who indicated at a hearing that his Committee would not be in the position to advise the Executive on what to do.