Speaker Orders Probe Into Seglemi Housing ‘Fraud’

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The Speaker of Parliament, Professor Aaron Mike Oquaye, yesterday ordered an investigation into allegations that the former Minister for Works and Housing, Collins Dauda, irregularly varied a parliamentary approval for the construction of 5,000 affordable housing units under the Saglemi Housing Project at the cost of US$200 million.

The Minister for Works and Housing, Samuel Atta-Akyea, had told Parliament that his predecessor, on his own motion, reviewed the original agreement and signed a “dubious” agreement with Messrs Constructora OAS Ghana Limited to downsize the number of houses to be constructed to 1,502 housing units with the same contract sum.

“On the 21st day of December, 2016, 14 days after former President John Dramani Mahama had lost his position in the elections, the then Chief Director, Alhaji Ziblim Yakubu, and the contractor, again, reviewed the first amended and restated agreement and signed a new agreement which reduced the scope of work to 1,024 housing units, instead of the 5,000,” the Abuakwa South MP said yesterday.

Responding to questions on the Floor of Parliament, Mr. Atta-Akyea said under the second restated agreement, 388 housing units were to be completed externally, while 90 units were to be left at foundation or lintel levels, adding that this was to bring the total units to be constructed to 1,502 units at a revised contract sum of US$181,519,000.

The Member of Parliament (MP) for Nsawam-Adoagyiri, Frank Annoh-Dompreh, had, among others, asked the Works and Housing Minister the state of the Saglemi Housing Project and when Ghanaians could have the benefit of it.

Implementation Status

Mr. Atta-Akyea said the ministry, under the watch of Collins Dauda, NDC MP for Asutifi South, hurriedly paid “a fantastic sum of US$80 million, representing 40 per cent of the contract sum to the contractor as mobilization,” without demanding a bond, which is a necessary prerequisite in such contract.

He disclosed that this was after the Ministry of Finance had on January 10, 2013 informed the former minister that Messrs Credit Suisse International had disbursed a total amount of US$198,450,000 being US$200 million less fees and transaction expenses of US$1,550,000 into the Escrow Account at the Bank of Ghana.

“Rt. Hon. Speaker, I do not know if the then Minister for Works and Housing had been bewitched by the contractor,” he wondered.

“I submit that the seed of the bankruptcy of the Saglemi Housing Project was sown by this dubious act. This racket was so strong that the ministry did not demand a performance bond as a necessary prerequisite before the release of US$80million,” he added.

According to the minister, immediately the sum of US$80,000 was released to the contractor when actual work had not started, the contractor transferred abroad US$40 million.

“The Saglemi Housing Project, whose contractor is Messrs Construtora OAS Ghana Limited, a Brazilian company, incorporated under the laws of Ghana, was one of the NDC government inherited troubles,” he said.

Speaker

Speaker Mike Oquaye, upon listening to the issues raised by the minister and the controversies surrounding them, referred the housing project to the Parliament’s Committee on Works and Housing to investigate and report back in two weeks’ time.

Prosecution

However, the minister is hinting of prosecution of the people involved, stating that “all the traducers of the law will be put before a court of competent jurisdiction to answer criminal charges.”

Mr. Atta-Akyea also said “a civil action shall be used to recover monies lost to the state and indicated that the audit would also project how much money would be required to complete the 5,000 housing units with full amenities.

“Currently, the racket could only deliver 636 housing units which are unfit for human habitation, because the necessary amenities like water and electricity have not been fixed, and the entire project lacks onsite infrastructure, especially a drainage system; the 388 housing units are at various stages of completion.”

Background

In 2002, the then Ministry of Water Resources, Works and Housing (MWRWH), acquired a parcel of land measuring 2,172 acres situating and lying at Saglemi, near Old Ningo, within the then Dangme East District of the Greater Accra Region as one of its land banks for the construction of the Government Affordable Housing Units.

This land was allocated to Messrs Construtora OAS Ghana Limited for the construction of 5,000 housing units.

On the 15th day of August 2012, the then President, John Dramani Mahama, granted executive approval to the ministry for the construction of 5,000 affordable housing units by Messrs Construtora OAS Ghana Limited for sale to workers through a mortgage arrangement via Ghana Home Loans.

Messrs Construtora OAS Ghana Limited was to utilize a buyer’s credit of US$200 million for the project.

The executive approval also permitted the then MWRWH to present to Parliament for approval the exemption of stamp duties, taxes, duties, levies and other charges relating to the execution of the project.

On Wednesday, the 3lst day of October, 2012, Parliament granted approval for the construction of 5,000 affordable housing units by Messrs Construtora OAS Ghana Limited for sale to the workers of Ghana through a mortgage arrangement underwritten by Ghana Home Loans, with a buyer’s credit of US$200 million.

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