Smarttys named in another govt contract
Smarttys Management and Production Ltd, the company which overpriced the rebranding of Metro Mass Transit Ltd buses last year, has been named in another contract between the government and the China Hunan Construction Engineering Group which has been overpriced by $9 million.
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The commercial contract, which was approved by Parliament Monday, is for $92 million in respect of the supply and erection of electrical materials and equipment for the electrification of 556 communities in the Eastern, Volta and Northern regions.
The contract is being funded from a $98-million credit facility agreement between the government and the Industrial Commercial Bank of China Limited.
However, the Minority, through its investigations, got wind of the fact that the project had been overpriced by $9 million and that Smarttys was involved and, therefore, brought the issue to the fore during the debate to pass the agreement, generating heated arguments.
The argument of the Minority, led by the member for Old Tafo, Dr Anthony Akoto Osei, was that Smarttys was the local representative of China Hunan Co. Ltd and was involved in the entire negotiation process.
He said the company, having been involved in a similar fraudulent activity on which the dust had barely settled, should have, in no way, been involved in the China Hunan deal.
A Deputy Minister of Power, Mr John Jinapor, who was in the House, admitted that the contract had, indeed, been overpriced and argued that the overpricing was $22.7 million but was reduced to $9 million after Crown Agents had detected the anomaly.
However, he considered the figure of $9 million as "cost saving" and maintained that it would be used to expand the project and ensure that many more communities benefitted.
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Minority views
Dr Osei said Smarttys, after engaging in the overpricing of the branding of the buses, had not "purged itself" of the fraud and, therefore, should not have been involved in any government deal.
"Is the government now satisfied with the misdeeds of the company?" he asked.
He wondered why the Mines and Energy Committee of Parliament hid the fact that Smarttys was involved in the China Hunan deal and added that but for the vigilance of the Minority, that fact would not have come out.
He said the Minority, while perusing the original contract agreement, detected that Smarttys was involved and was the local representative of the Chinese company.
He expressed the view that the committee had not done a good job and must, therefore, withdraw the report and make it complete by adding Smarttys as local representatives, so that the people's representatives would know about the full details of the agreement.
The MP for Manhyia South, Dr Matthew Opoku Prempeh, said the committee should have done more due diligence to avoid the situation where the costs of contracts were overbloated and certain companies also always got associated with such overbloated contracts.
"We are not interested in who is behind Smarttys but the company is using its contacts to milk Ghana. Smarttys over-billing here, Smarttys over-billing there, Smarttys over-billing everywhere," he said.
The Minority Leader, Mr Osei Kyei-Mensah-Bonsu, said the government should have included lawyers in the negotiations to avoid the problem, adding that Parliament ought to engage independent consultants to look into every contract signed by the government.
He added that Crown Agents was monopolising such contract audits.
"We must exercise proper oversight over the Executive to ensure that the nation is not unduly shortchanged in such contracts," he said.
He also noted MPs were not against Smarttys as a local company or local companies in general.
"Smarttys' involvement in certain contracts is unholy and questionable, that is all," he said.
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Majority
The Minister of Roads and Highways, Alhaji Inusah Fuseini, indicated that to ensure value for money in every contract, it was usual for the government to call for auditing because most contractors liked to reap huge profits from projects assigned to them.
He said the government should rather be commended for engaging in an audit of the contract and saving $9 million for further work on the project.