Government has been accused of failing to do due diligence in the agreement which handed electricity distribution services in Ghana to the Power Distribution Service (PDS).
The former Chief Executive Officer of the Volta River Authority (VRA) said on Joy FM that the agreement was rushed to meet the deadline of the Second Millennium Challenge Corporation Compact.
The rushed decision, Dr. Charles Wereko-Brobby, argued on the Super Morning Show Wednesday, must be blamed for the anomalies which have now led to government’s suspension of PDS from going ahead with its obligation under the contract.
On March 1, 2019, PDS took over some assets and operations of the ECG including electricity service distribution in all of ECG’s operational areas in Ghana.
The new arrangement was among other things expected to cut distribution losses to the barest minimum while delivering improved power services to Ghanaians.
This has now been suspended.
Announcing the decision on Joy News’ PM Express on Tuesday night, Information Minister, Kojo Opong Nkrumah said the decision was reached after painstaking investigations.
A statement which followed from his office said in part “ the decision follows the detection of fundamental and material breaches of PDS obligations in the provision of payment securities (Demand Guarantees) for the transactions which has been discovered upon further due diligence.”
However, Dr. Wireku Brobbey believes the government should have done due diligence before signing the contract.
“The government rushed to meet a deadline and failed to do due diligence and “now we are trying to do the due diligent after the fact,” a troubled Wereko- Brobbey said.
“We were forced to take the decision without necessarily satisfying certain preconditions,” he added.
Dr. Wereko- Brobbey’s allegations that the government rushed into contractual obligations with PDS follows Ghana’s signing of the second Millennium Challenge Corporation Compact on August 5, 2014.
The five-year Compact with the United States of America which is designed to address challenges in distribution, generation and access to energy in Ghana expires in 2019.
According to Dr. Wereko- Brobbey Government was running against time to access $498.2 million to support the transformation of Ghana’s electricity sector and stimulate private investment.
He pointed out that this money is not significant enough for the government to gamble with a strategic national assert plagued with challenges.
The energy expert believes that given that Ghana was able to recently spend $ 4 billion on banking sector cleanup the country has no excuse dealing with financial challenges which have dotted the energy sector.
The energy sector, he pointed out is the sector which is supposed to drive development and investment agenda of the country.
He wants the government to see its current challenges with PDS as an opportunity to man up to its dues of addressing challenges of the energy sector comprehensively. He cited billing issues and continual indebted to Independent power Distributors as cases in point.