The government has instituted a strict legislative mechanism to ensure that before the start of any project of interest, there is a comprehensive regime of guaranteed financial flows for its completion, the Director General of the National Development Planning Commission (NDPC), Dr Kodjo Essien Mensah-Abrampa, said.
According to him, the move is aimed at preventing the stagnation of government investment projects that end up driving up the initial price expected for execution and, invariably, in some cases, leave projects unfinished for decades.
Speaking to the B&FT in an interview, Dr Mensah-Abrampa said that due to this worrying development, a legislative instrument (LI) has been adopted by the government to impose certain binding responsibilities on the Ministry of Finance to help to prevent future events.
“The flow of resources has become critical for the government. A system has been put in place to review the regime of resources available for the execution of a project from start to finish. This is to ensure that when a project is started it will end and not stagnate to increase the cost of completion by the government.
“Once an asset is initiated but not completed, it becomes a liability. This has been a huge problem, but with the adoption of a legislative instrument by Parliament on this issue, we are confident that in the future there will be no case where investment projects will be started and not completed, ”he said.
Elaborating on the issues, Dr Mensah-Abrampa noted that the system that has been put in place is robust. “There is a committee which is chaired by the Ministry of Finance, and the Director General of NDPC sits on it; there are several directors at the Ministry of Finance. In addition, a representative of the Institute of Engineers of Ghana sits on the committee.
“There is also the Central Tender Review Committee which reviews all capital projects in which the government is interested; they assess, and the full scheme of funds for the project is determined before it starts.
In 2018, it was estimated that the country was losing up to $ 25 million per year due to unfinished projects. That amount was equivalent to 667 class blocks of three additional units per year, which could accommodate around 70,000 students, according to a study.
The study was conducted in Ghana between 2014 and 2017 by Dr Martin J. Williams, associate professor of public administration at the Blavatnik School of Government, University of Oxford, in collaboration with the National Development Planning Commission (NDPC) and the Local Government Service Secretariat (LGSS).
The study shows that around a third of the projects started between 2011 and 2013 were never completed. The study also found that contrary to popular opinion – these unfinished projects were due to corruption and politics or elections – the results showed that neither was the cause. He said more work was done on projects than was paid for, and project completion rates were also consistent over the years.
On the contrary, districts were spreading their project resources too far across too many projects that they could not afford to complete each year. Despite this, projects were carried out more effectively through local government than through central government.