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28 August 2017

Procurement expert indicts Mahama minister in new Jospong scandal

The president of the Ghana Institute of Procurement and Supplies has indicted the Local Government Ministry for sole sourcing a contract for the supply of one million waste bins and disposable bin liners under the John Mahama administration.

Collins Sarpong said the circumstances under which the contract was sole sourced raised questions about a possible breach of the procurement law.

At best, the contract whose sum has been inflated by about $130 million could have been awarded through a competitive or at worse restrictive tendering process he suggested.

He was commenting on a Joy News investigative report about possible cases of corruption in the award of contract to the Jospong Group of Companies.

After nine months of Joy News investigations titled Robbing the Assemblies, Manasseh Azure-Awuni found that the Local Government Ministry awarded a contract to five companies to supply one million waste bins and 900,000 bin liners at a cost of $74, 040,000  (GHc318million). 

The cost of the one million waste bins is $60 million while the cost of the bin liners is $14, 040,000. These amounts do not include Value Added Tax.

It emerged after investigations that all the five companies handpicked by the ministry to supply the waste bins are subsidiaries of the Jospong Group of companies.

As if that was not enough, the cost per each waste bin quoted appeared to have been inflated.

Checks by Manasseh indicate that Universal Plastics and Recycling Company Ltd, one of the five companies who has been awarded the contract is already selling waste bins to the general public at a cost ¢150.00.

Invoices submitted by the company to the investigative team also confirms the bin was sold to the public at ¢150.00.

However, the contract signed between the Jospong Group of companies and the Local Government Ministry in 2016 pegged the price per each waste bin at $60 which gives Jospong a profit margin of not less than $130 million.

In an attempt to justify why the contract was sole sourced then Local Government minister, Collins Dauda, wrote to the PPA insisting the contract ought to be awarded under the certificate of urgency because the bins were urgently needed because it was approaching the rainy season and there was the possibility of cholera outbreak. 

Months after the contract has been signed and monies paid, a good number of the local assemblies are yet to receive the waste bins, defeating the very purpose for which the contract was sole sourced under a certificate of urgency.

Attempts to get the officials within the former administration as well as Jospong Group of companies to comment proved futile.

But the president of Ghana Institute of Procurement and Supplies, said the conditions under which the contract was sole sourced cannot be tenable.

“The law is clear when to use single source or sole source procedure. If the item involved can be found from only one supplier in the market or under certificate or emergency you can apply sole source or single source.

“If the bins are available with a number of suppliers within the market and the items needed is not under a certificate of urgency then you need to use the default method that is national competitive tendering,” Collins Sarpong intimated.

He said in the event the suppliers are limited then a restricted tendering process must be adopted.

Even though the contract was awarded under a certificate of urgency, Collins Sarpong said the raining season cannot possibly be an excuse because the contract was awarded in October, more than five months away from the raining season.

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