KPMG Report: GRA bypassed PPA and Parliament in SML contract

• May 23, 2024

The KPMG report on the contract between SML and the Ghana Revenue Authority has revealed that GRA did not receive appropriate approvals from the Public Procurement Authority as well as Parliament for the contract.

The report also outlines that SML performed partially under the contracts under review. These are findings contained in the full report of KPMG that has been made available to the public.

The Presidency had earlier denied requests for the report to be made public.

The audit was necessitated by outbursts following a report by the Fourth Estate on how the Ghana Revenue Authority was paying SML monthly, allegedly for no work done.

The report noted that the terms of the contract were undertaken by existing stakeholders within the petroleum sector.

The said contracts covered the monitoring and auditing of revenue within the petroleum downstream sector and a subsequent contract for similar activities to be undertaken in the upstream petroleum sector. After KPMG’s audit was made available to the president, a statement from the Presidency accepting the audit directed the cancellation of the contract with SML for the upstream sector and a renegotiation of the contracts for the downstream sector.

Anti-corruption agencies partially commended the President for the directions but requested a release of the full report.

The Media Foundation for West Africa, for instance, filed for a release of the report under the Right to Information Act.

The president, however, disagreed, stating that the audit report falls under information that can be excluded from publication under the Right to Information Act.

The Presidency, however, upon further consideration, published the report, citing the need for transparency and accountability as the reason for the change in position. The report reveals that SML was incorporated on February 14, 2017, as SMEL.

The Ghana Revenue Authority, however, between June 16, 2017, and the same September, made three attempts to contract SMEL under a single-source contract but was rejected by the Public Procurement Authority.

The report notes that in November 2017, SMEL changed its name to SML and in June 2018 the following year, was appointed as a subcontractor of West Blue Ghana Limited, who at the time were service providers for the GRA.

The GRA is alleged to have, since the appointment of SML as subcontractors, engaged SML as main contractors on five different contracts under sole sourcing without approval from the Public Procurement Authority.

The report also recorded that GRA entered into some contracts without parliamentary approval even though the Public Financial Management Act stipulates that an entity that enters into contracts that seek to bind the government of Ghana financially for more than one year ought to receive ministerial and parliamentary approval.

KPMG notes that some of the contracts were for a five-year period. GRA is also said not to have sought board approval for some of these contracts.

KPMG also notes in the report that the GRA did not undertake any needs assessment to ascertain the relevance of the contract with SML.

KPMG’s assessment of the contract performance of SML with respect to some of the contracts, including the transaction audit services and External Price Verification Services, concluded that SML delivered partially on the service requirements, suggesting that the GRA may not have obtained all the expected benefits from the service.

citinewsroom.com