…. Reveals procurement rules were disobeyed in US$250m new head office project
Documents making the rounds on the construction of the new head office complex of the Bank of Ghana (BoG) at South Ridge – Accra, have revealed that the Governor, has been economical with information on the procurement processes of the project which started off at US$81.8million, then to US$121million, but currently stands at a staggeringUS$250 million.
Some of the documents also revealed that, Dr Ernest Addison’s emphatic claimthat the institution did not breach any procurement laws in its pursuit of building a new headquarters for the Central Bank, is far from the truth, as Central Tender Review Committee (CTRC) of the Ministry of Finance, as well as the Public Procurement Authority (PPA) took turn to indict BoG’s processes leading up to start of the project.
One of the documents dated January 17, 2023 from CTRC and signed by its Secretary, David Quist, titled “ Re: Construction of corporate headquarters at South Ridge, Accra – Variation” disclosed that the Tender Committee had “Concerns” about the BoG’s processes and had communicated that to Central Bank in a letter dated December 30, 2022.
According to this particular document, “the Committee reviewed the Bank of Ghana’s (BOG’s) Variation request at the 17th Emergency Sitting on Thursday, 29th December 2022. In a letter dated 30th December 2022, the Committee communicated concerns to BOG, which was responded to in a letter dated 5th January 2022 (sic). Following a review of the response, the Committee noted that the issues raised remained unsatisfactorily addressed. BOG was accordingly invited to a clarification meeting and was subsequently requested to submit the Original Contract Document, Design Proposals, Differences in Scope of Works, and other relevant documentation on the Project to facilitate review of the request”.
The January 17, 2023 document continued that “at the 21st Emergency Meeting on Tuesday, 17th January 2023, the Committee reviewed the documentation submitted by BOG and noted the following; Inadequate Project Design Conception and preparation of the Original Contract, Entirely new Scope in Design for the Revised Project and Revised Scope of Works has already commenced prior to seeking approval from the CTRC”.
Aside the above, the document further revealed that the BoG, had “no detailed Project Milestones identified as benchmark for payment under the Project to protect BoG against any risk of financial exposure” adding, Unit Cost of revised Scope of Works is Competitive with Unit Cost of Similar projects on the Market – source (2021/22 Property & Construction – Africa Cost Guide).
“The Committee hereby advises BOG to adhere to the requirements of a comprehensive design preparation, and procurement approvals for projects of such nature (Design and Build) to avoid huge variation costs in the future procurements. BOG is further advised to develop detailed Project Milestones as benchmark for payments under the Project”, the document revealed. It is the therefore untrue that the BOG met all the rules relative to procurement processes.
The document went to say that the “in view of the stage of the project and reasonableness of the Unit Cost, the Committee grants concurrent approval for the revised Scope of Works at a contract amount of Two Hundred and Twenty-Two Million, Seven Hundred and Ninety-Nine Thousand and Sixty US Dollars and Fifty-Five Cents (US$222,799,760.55) relating to a Unit Cost of US$2,068.13/M and excluding taxes”.
The CTRC which copied the Finance Minister, Minister of State at the Finance Ministry, the Deputies, Chief Director at the Finance Ministry, the Board Chairman of the PPA, the Chief Executive of the PPA and the Chairman of the Chairman of the CTCR, advised BOG to “kindly keep records of the above for any future procurement audit”.
The Herald, has also observed that the process towards the construction of the building started in 2020 with various letters some of which went to the PPA.
Indeed, in one of the letters dated August 28, 2020 and addressed to the Governor, the CTRC, raised questions by stating that “at the Emergency Sitting on Friday, 28th August 2020, the Committee reviewed BOG’s revised evaluation report and noted that the recommended award figure of US121, 078,517.94 substantially exceeded the Public Procurement Authority (PPA) approved estimated amount of US$81, 882,640.00”.
An earlier letter dated January 28, 2020 and signed by Frank Mante, who identified himself as the Acting Chief Executive of the PPA, the cost of the project should be revised as follows; Preliminaries at a cost not exceeding 2%, Professional fees at a cost not exceeding 5% and Contingencies at a cost not exceeding 2%”.
The letter titled “Re: request for restricted tender approval-development of corporate office complex for Bank of Ghana”, was addressed to Secretary of the Bank of Ghana saying “We make reference to your letter no. SF/ORG/7/2020/1 and dated 14th January, 2020 on the above mentioned subject”.
“At the Board Technical meeting No. 35 (035/2020) held on Monday, 27th January, 2020, the Board after evaluation of your request decided that, the cost of the project should be revised as follows; “Preliminaries at a cost not exceeding 2%, “Professional fees at a cost not exceeding 5%, “Contingencies at a cost not exceeding 2%.
“Accordingly, and in line with Section 38 (b) of act 663 as amended, we convey the Board’s approval to Bank of Ghana (BoG), to use the Restricted Tendering Method to invite the underlisted Companies to tender for the Development of a Corporate Office Complex at a revised estimated cost of US$81,882,640.00 (as per PPA’s revision indicated above)
The shortlisted firms are: 1. Messrs. WBHO Ghana Limited, 2. Messrs. Man Enterprise, 3. Messrs. DeSimone Limited, 4. Messrs. Ronesans Limited, 5. Messrs. Goldkey Properties.
“Please ensure that all documentation regarding this procurement is appropriately kept to facilitate future procurement and tax audits and also you are reminded to post the contract award notice on the Public Procurement Website: www.ppaghana.org.
“We count on your usual co-operation.
Meanwhile, workers are busily on site working on the project.
The Minority in Parliament, has threatened to march to the premises of BoG to drag Governor Addison and his deputies out from office if they fail to resign within 21 days.
The Minority is angry about the cost of the new headquarters, which they say is excessive and unnecessary, as well as the losses incurred by the BoG during the 2022 fiscal year.
They argue that the BoG, could have renovated its existing headquarters for a fraction of the cost.
The BoG, has defended the cost of the new headquarters, saying that it is necessary to ensure the safety and security of the bank’s operations.
The bank says that a structural integrity assessment conducted on its current headquarters revealed that the building is no longer fit for purpose.
The BoG, says that the new headquarters is currently at 41% completion and is expected to be completed by September 2024.
The construction of the new headquarters has also been criticized by some architects and engineers, who say that the design is not in keeping with the architectural heritage of Accra.
Despite the criticism, the BoG, has said that it is committed to completing the new headquarters.
Meanwhile, the Member of Parliament (MP) for North Tongu, Samuel Okudzeto Ablakwa, who has been in possession of documents detailing the drastic escalation of the cost of the new BOG Headquarters from the initial projected cost of $80 million to a staggering $250 million at present in a Facebook post, said that the construction firm, selected through a single-source Public Procurement Authority (PPA) process for the project, is not even a registered entity within the country.
This shocking revelation, has deepened suspicions of irregularities and potential improprieties in the entire selection and approval process.
The North Tongu MP, also pointed out that a separate company was granted PPA approval for project management services a full three months prior to its official registration.
Ablakwa also dismissed claims that the decision to construct a new headquarters for the Central Bank commenced under the erstwhile National Democratic Congress.
“From the intercepted documents, procurement for the project did not commence under the NDC or during the tenure of Hon. Ato Forson as Board Member, neither did it start during the presidency of H.E. John Mahama, contrary to the vicious fabrications by some desperate NPP apologists.
“The BoG’s unacceptable use of the Restricted Tendering Method amounts to a blatant violation of the Public Procurement Act, 2003 (Act 663) as amended in Act 914. Section 38 of Act 663 provides a limited scope for the use of Restricted Tendering in circumstances where goods, services or works are available only from a limited number of suppliers or contractors;
“From the intercepted documents, the BoG handpicked the following companies: i) Messrs. WBHO Ghana Limited, ii) Messrs. Man Enterprise, iii) Messrs. DeSimone Limited, iv) Messrs. Ronesans Holdings and v) Messrs. Goldkey Properties;
“It is not clear what criteria the BoG used in selecting its preferred 5 companies when Ghana’s built environment can boast of many established and celebrated construction firms such as Consar, Berock, Maripoma, Mawums, M. Barbisotti, First Sky, Antartic, Ussuya, Regimanuel, and so on and so forth.”
