Ghana’s President, Nana Akuffo Addo, has suspended a contract estimated to deliver a monthly payment of up to Ghc240 million to a private company, Strategic Mobilization Ghana Ltd (SML). This followed a series of investigative stories by The Fourth Estate, an accountability journalism project of the Media Foundation for West Africa (MFWA).
Dragging over a whole year, The Fourth Estate’s investigations exposed the details of the SML contract which was to enhance revenue assurance in Ghana’s petroleum downstream sector. The reports uncovered a number of disturbing revelations, including the fact that SML, which is supposed to be providing revenue assurance in the petroleum sector, is actually an offshoot of a timber company. It also emerged that the private company SML was single-sourced in the contracting by the Ghana Revenue Authority (GRA) and the Finance Ministry, without recourse to Parliament whose approval is required before the company could be engaged. In addition, it came to light that SML had political connections within the current government with its Managing Director, Christian Tetteh Sottie, previously being employed as Technical Advisor to the Commissioner General of the GRA, and only picking up the job as MD at SML, after resigning his position at the GRA after GRA contracted SML.
A statement dated January 2, 2024, and signed by the Director of Communications at the Ghana’s Presidency, Eugene Arhin, announced the suspension of the contract and added that “the President of the Republic, Nana Addo Dankwa Akufo-Addo, has appointed KPMG, the reputable Audit, Tax and Advisory Services firm, to conduct an immediate audit into the transaction between the Ghana Revenue Authority (GRA) and Strategic Mobilization Ghana Ltd (SML), a contract which was entered into to enhance revenue assurance in the downstream petroleum sector, the upstream petroleum production and minerals and metals resources value chain,”.
The President “also directed the Ministry of Finance and the Ghana Revenue Authority to suspend the performance contract pending the submission of the audit report, including any payments presently envisaged under its terms.” KPMG has also been tasked to “assess the appropriateness of the contract methodology, verifying compliance with legal standards and industry practices in the procurement process for the selection of SML.”
The president’s directive follows an earlier one by Parliament to the Ghana Revenue Authority (GRA) to suspend payments to SML. In the days after that, the Office of the Special Prosecutor (OSP) also opened an investigation into the contract after it was petitioned by the journalists who did the stories.
Background
In 2019, the Ghana Revenue Authority signed a so-called “revenue assurance” contract with SML. Even though per investigations, it is not exactly clear what SML is supposed to do, the presidency has said that the private entity was contracted to “enhance revenue assurance” in the petroleum downstream sector. SML therefore began the performance of its contract in June 2020. In March 2021, SML claimed that it had saved Ghana up to Ghc1 billion due to the meticulous performance of its contract to ensure that the country did not lose revenue in the downstream petroleum sector. Then in February 2023, the company made an even more audacious claim that its services had saved the country some Ghc 3 biilion.
This claim was widely reported in the Ghanaian media, including in the state-owned Daily Graphic while SML itself flaunted the claim on its website. Ghana’s Finance Minister, Ken Ofori-Atta, would also tout the supposed revenue savings that SML had made for Ghana as part of the supposed superior statecraft that the current government is providing Ghanaians.
The Investigations
But while SML was blowing its horns and receiving applause from the Finance Minister, and the media was reporting its claims under banner headlines, The Fourth Estate had started an investigation into the contract. Perhaps the worst of the revelations was that SML did not ensure the saving of the Ghc3 billion that it claimed to have saved. The story revealed that the company only duplicated roles that state agencies were already playing and there was no evidence for the fantastic claim that it had saved Ghana Ghc3billion. SML was also caught engaging in blatant subterfuge, secretly deleting false claims it had made on its website about its supposed outstanding delivery on the contract, after it was confronted with the fact.
Upon the completion of investigations, The Fourth Estate published its reports both in a video documentary format and in digital print versions. Within the media itself, the expose trended virally online, with many mainstream media outlets sourcing the stories in part or in whole for their own reports. They include Modernghana.com, The Herald newspaper, 3News, TV3 and Myjoyonline.com
About The Fourth Estate
The Fourth Estate is a non-profit, public interest and accountability investigative journalism project of the Media Foundation for West Africa (MFWA). It aims to promote independent and critical research-based journalism that holds those in power answerable to the people they govern.