Democracy Watch Vol. 10, No. 1 August 2012 1 Newsletter of the Ghana Center for Democratic Development 35 Democracy Watch Volume 10, No. 1 August 2012 IN THE ANNALS OF DEMOCRATIC GOVERNANCE ISSN: 0855-417X In this issue bids for tenders to refurbish and construct new stadiums for the tournament. In the The Republic versus Alfred The Republic versus course of the tendering process, Agbesi Woyome: Alfred Agbesi MPowapak/Vamed allegedly transferred Matters Arising from State Woyome: Judgment and Settlement Debts all its rights and responsibilities under the (Part 1) ....Page 1 Matters Arising from bid to a company called Waterville State Judgment and Holding BVI. Settlement Debts The ECG Exposé and Ghana’s (Part 1) The “Waterville/Vamed/MPowapak” bid Public Sector ....Page 4 was successful. However, the award of the contract to Waterville/Mpowapak/ Vamed was subsequently abrogated. The Lessons from the Millennium From the last quarter of 2011, the government unexpectedly (and, possibly, Challenge Account Project ....Page 6 people of Ghana have been, in equal illegally) awarded the stadium measure, fascinated and horrified by refurbishment contract to the Shanghai what is potentially one of the largest Construction Group, a Chinese The Presidential Transition Act corruption scandals in Ghana’s history. construction firm. Waterville protested – A good first step ....Page 9 Between February 2010 and the termination through its lawyers, and September 2011, the government of was ultimately awarded 25 million euros Ghana paid approximately GHC51 in compensation for “actual work done President John Evans Atta Mills: million ($35 million) in tranches to Mr. and financial engineering.” In 2009, Mr. 1944-2012 ....Page 10 Alfred Woyome, an Accra-based Woyome petitioned the government to businessman with close ties to the be paid for work he also allegedly did. ruling National Democratic Congress Mr. Woyome claimed that he had been (NDC) party. The circumstances central to the bidding process, and surrounding the payments are still demanded to be included in the settlement somewhat unclear. They are also the arrangements between the government EDITORIAL TEAM subject of on-going criminal and civil and Waterville. According to the EOCO Editors-in-chief cases, with some of the details report, Mr. Woyome claimed, among E. Gyimah-Boadi surrounding the payments strongly other things, that he had been instrumental H. Kwasi Prempeh disputed. However, according to an in raising 1.1 billion euros to finance the “Interim Report” prepared by the construction of the stadia and various Members Economic and Organized Crime other facilities, and that he was entitled Kojo Pumpuni Asante Office (EOCO) on the matter, in 2004/ to a 2 percent commission Victor Brobbey 5, Mr. Alfred Woyome was involved (approximately 22 million euros) for Theodore Dzeble in Ghana’s winning bid to host the raising the said sum. This conclusion was Audrey Gadzekpo 2008 African Cup of Nations ultimately supported by the legal Nana Ama Nartey tournament. Subsequently, a company directorate of the Ministry of Finance, Franklin Oduro with which he was associated called and endorsed by lawyers at the Attorney- www.cddghana.org MPowapak, or Vamed, submitted 2 CDD-Ghana... partisans for democracy and good governance General’s Department, who wrote to the Finance Ministry scandal intensified, the government began to take steps to urging prompt payment. distance the executive from the scandal. At the President’s After some hesitation by the finance ministry, which resulted press briefing in January 2012, he denied any knowledge in Mr. Woyome filing a lawsuit against the government to of the scandal, and ordered an investigation by the EOCO. enforce his claim, the government (acting through the finance The Woyome scandal led to the resignation of the Minister ministry and the Attorney-General’s Department) reached of Education, Betty Mould-Iddrisu, who was the Attorney- a settlement agreement with Mr. Woyome for the amount General at the time the payments were negotiated. Mrs. allegedly owed to him to be paid in instalments. By Betty Mould -Iddrisu and her Deputy (Ebo Barton-Oduro) September 2011, full payment of GHC51 million – have both stated publicly that the government did not have representing the amount allegedly owed for financial a defence against Mr Woyome’s claims (though engineering and interest thereon – had been made to Mr. subsequently, Mrs Mould-Iddrisu went back to court to Woyome. The scandal broke in late 2011 when the Public challenge the judgment debt settlement). Accounts Committee of Parliament raised questions about the payments. The scandal, which attracted intensive The most politically damaging incident arising from the coverage in the electronic and print media, was the subject scandal was the dismissal of the Attorney-General, Mr. of a press conference by the Opposition in Parliament. It Martin Amidu, in January 2012. It appears Mr. Amidu had had become the primary news story nationwide by the time become aware of the scandal somewhat belatedly. President John Atta Mills gave his annual press briefing in However, once he became aware of the matter, he made January 2012. It even generated more discussion than the no secret of his intention to investigate it fully, and prosecute then on-going 2012 African Nations Cup tournament. all guilty parties irrespective of their political coloration. He initiated civil actions to retrieve the payments that had As the primary basis for questioning the payments, the been made to Mr. Woyome, and prepared for criminal stories in the public domain have focused on the alleged prosecutions against Mr. Woyome himself. Then, on 12 absence of a formal contract between the government and January, Mr. Amidu, while still Attorney General, issued Mr. Woyome as well as insufficient evidence that he had an open letter in which he accused certain unnamed performed tens of millions of dollars worth of work prior elements within his own party of masterminding a vilification to the start of the 2008 African Nations Cup. Moreover, campaign against him in what he called the ‘gullible’ and very few questions appear to have been raised by the ‘rented’ pro-government media. He also suggested that relevant authorities prior to the disbursements of the money the motivation for the vilification campaign was to intimidate to Mr. Woyome. Indeed, several letters were made public him into covering up ‘gargantuan crimes’ that had been in which it appeared that officials from the Attorney- committed by individuals in his government. A few days General’s Department were suspiciously insistent that the later, Mr. Amidu was dismissed by the President for finance ministry make quick payment to Mr. Woyome misconduct, and behaviour ‘incompatible with acceptable despite the seemingly obvious problems surrounding the standards’ of a minister and an appointee of the President. transaction. Also, the proximity of Mr. Woyome to the ruling His replacement, the Minister of Interior Benjamin party fuelled suspicions about the speed with which the Kunbour, was instructed to continue with the prosecution payments were made. He was present in Sunyani for the of the Woyome case. NDC 2011 presidential primary and appeared on political platforms for many aspiring candidates during the In February 2012, Mr. Woyome, Mr. Paul Asimenu, head parliamentary primary contests of the NDC. of the Legal Directorate at the Ministry of Finance and Economic Planning, Mr. Samuel Nerquaye-Tetteh, Chief The response of the Mills government to this scandal has State Attorney, and his wife Mrs. Gifty Nerquaye-Tetteh evolved since the scandal broke. Initially, government were arrested for corruption of a public officer, and officials (such as the Deputy Chief of Staff, Alex Segbefia) defrauding by false pretences. Mr. Nerquaye-Tetteh had defended the payments. The President suggested that the responsibility for the Woyome case in the Attorney- previous administration was more culpable for the payments General’s Department while his wife, according to the than his administration, suggesting that actions such as the EOCO, was complicit because her bank records revealed termination of the tender and the award of the contracts to she had received a transfer of $400,000 from Mr. Woyome Shanghai Construction, and general negligence on the part in the course of the negotiations with the government. of the NPP administration had left his government with a Though charges against the latter three have been mountain of judgment debts, including that of Alfred suspended for reasons that remain unclear, Mr. Woyome Woyome. However, as more information about the is currently being tried for causing financial loss to the state, transaction became known, and public uproar over the and defrauding by false pretences. Democracy Watch Vol. 10, No. 1 August 2012 3 A full analysis of the implications of this still unfolding tragic Furthermore, questions must be asked about the systems and occasionally farcical scandal for democracy and and checks that are in place in respect of payments of governance in Ghana will have to wait for the facts to be public funds, and the extent to which the systems operate firmly established. The Woyome scandal has triggered efficiently to prevent dubious payments. Certainly, the disclosures of other judgment debts against the state dating disclosures point to the actions and inactions of state back to the New Patriotic Party (NPP) administration. institutions and official actors in promoting public Many of these disclosures, including the Woyome episode, accountability and, in particular, combating official are still unfolding. corruption. What stands out in this entire affair is the conduct of public officials, and manifestations of conflict In Part One of the ‘Judgment Debt’ saga, Democracy of interest. The scandal brings to the fore the absence of Watch will highlight some of the major weaknesses in clear and stringently enforced rules and code of conduct Ghana’s Public Financial Management (PFM) systems to prevent public office-holder conflict of interest in Ghana’s exposed by these scandals, and raise questions on the Fourth Republic.