Collins Dauda facing $200m housing deal probe

• Posted on May 17, 2019
• by Nana Kwesi Coomson
• Comment

The Attorney General (AG) and Minister of Justice, Gloria Afua Akuffo, has indicted Alhaji Collins Dauda, former Minister for Works and Housing under the previous Mahama administration, over the controversial $200 million Saglemi Housing Project.

The previous National Democratic Congress (NDC) administration reportedly used $200 million to construct 1,502 houses for sale when it was supposed to build 5,000.

The initial contract of $200 million for 5,000 houses at Saglemi in rural part of the Greater Accra Region had parliamentary approval, but when it was ‘reviewed’ to 1,502 allegedly by Mr. Dauda, the agreement did not receive any parliamentary approval although the entire cost was maintained in the execution of the contract.

The Brazilian Contractor, Constratora OAS Ghana Limited, in February 2019, notified the government that it wanted to terminate the contract because the remaining 20 per cent of the contract sum had not been paid.

The Akufo-Addo administration, through the Works and Housing Ministry, referred the matter to the Attorney General for advice.

Current Works and Housing Minister, Samuel Atta Akyea, who wrote to the Attorney General over the matter, told journalists recently in Accra that the government could not make any decision on the matter without the advice of the AG.

The minister disclosed that the 1,502 housing units should have cost at least $60 million, announcing that the country was woefully shortchanged in the review of the contract.

As a result, the AG, in a letter to Mr. Atta Akyea dated May 8, 2018, said the Ministry of Justice had reviewed all the documents regarding the Saglemi Housing Project and had come to the conclusion that the matter should be subjected to criminal investigation.

The AG, in her observations, said, “Both the Executive approval and the Parliamentary approval for the Saglemi Housing Project were for the construction of 5,000 housing units at a cost of US$200,000,000.00.”

1,502 Units

“From the documents reviewed, there is no evidence justifying the variation of the scope of the agreement in the First and Restated Agreement signed by the then Minister, Hon. Collins Dauda, which reduced the number of housing units to be constructed from 5,000 to 1,502 even though the price remained  US$200,000,000.”

According to the AG’s letter, “Since the First and Restated Agreement witnessed a substantial reduction in the scope of the agreement from 5,000 housing units to 1,502 housing units, the ministry ought to have resubmitted the agreement to Parliament for approval.”

The AG said, “The ministry’s failure to resubmit the First and Restated Agreement to Parliament for approval therefore renders it null and void.”

The then Chief Director of the Ministry of Works and Housing, Alhaji Ziblim Yakubu, signed the Second and Restated agreement dated December 21, 2016, with Messrs Constructurora Limited, which changed the terms of the original agreement to 1,502 housing units, which were to be delivered at three different stages of completion as 1,024 housing units to be fully constructed; 388 housing units to be completed externally and 90 units to be left at foundation or lintel levels.

Final Advice

The AG, therefore, advised that since the agreement expired in June 2017, there can be no termination of a non-existent agreement as requested by the ministry.

The AG also stated that “the agreement, having expired in June 2017, the purported Notice of Termination by the contractor has no basis in law and is therefore of no effect. The ministry is therefore advised to write formally to the contractor rejecting the purported Notice of Termination.”

Furthermore, the AG said that “since the parties to the agreement are bound by the agreed accrued rights and obligations, notwithstanding its expiration, the ministry is advised to demand specific performance of the obligations of the contractor as contained in the expired agreement. Alternatively, a demand may be made by the ministry on the contractor for a refund of all overpayments, as well as interest subject to the conduct of a value-for-money audit.

“In the absence of a valid explanation for the variation of the terms of the original agreement, it’s advised that the matter be referred to the appropriate authority for criminal investigation,” the AG added.

By Melvin Tarlue