SSNIT Responds to AuditorGeneral’s Queries

The Social Security and National Insurance Trust (SSNIT) has said most of the findings of the Auditor-General’s report on the Trust for the financial year ended December 2020 are follow-ups on legacy issues spanning over two decades that were raised in the 2017 – 2019 Auditor General’s report.

Consequently, the Trust has resolved the majority of the issues and instituted measures and policies to prevent future occurrence, the Director-General, Dr John Ofori-Tenkorang, said when he joined the sector minister Ignitius Baffour Awuah and his team of directors to appear before the ongoing Public Accounts Committee (PAC) public hearings in Accra yesterday.

Operational results

Audit findings regarding the operational results indicated that the Trust recorded a deficit of GH¢427 million in the 2019 financial year as compared to a deficit of GH¢442 million registered in 2018.

This represents a 6.8 per cent increase in the Trust’s financial performance over the period.

But in his response, Dr Tenkorang said the deficits recorded in revenue were a result of an increase in benefits payments as against a shortfall in expected contributions paid by the Controller and Accountant General’s Department.

He added that there was a surplus of over GH¢1 billion in 2020 and a marginal deficit of over GH¢300 million, adding that management was expecting to record a surplus in 2022 accounts.

Investments

Regarding the audit findings on investments, the A-G noted from its review of investment files that the Trust liquidated three companies with a total investment of US$14,768,153.00. The

Trust had not received any returns from two of the companies for its investment for the past 15 years. The loss from the liquidations amounted to US$11,794,109.

On the action taken, Dr Tenkorang said the current management inherited these non-performing legacy investments and efforts had been made to ensure that SSNIT got the best deal through the liquidations and added that liquidations of the two companies in question, which the Trust was to receive returns from, were yet to be completed.

In the case of Ningo Salt Limited (NSL), he said the amount lost by SSNIT was reduced from the stated US$6.08 million to US$1.93 million. A loan of US$4.15 million, which was granted through Ecobank Ghana Limited, had fully been recovered with interest.

For Granite and Marbles Limited, SSNIT managed to retrieve its unpaid social security contributions and penalty of GH¢428,337.07. All the loans were converted to equity prior to the liquidation as of March 2020.

Regarding Canada Investment Fund for Africa (CIFA), he said that had been under liquidation since 2015 and noted that as per the Fund Manager’s 2019 report to shareholders, the liquidation process was yet to be concluded.

He gave an assurance that the Trust would recover the outstanding amounts when the liquidations were completed.

Consequently, he told the committee that these were matters that kept recurring in the books of the Trust forcing the chairman, James Klutse Avedzi, to direct the Trust to ensure that it did not reappear in its books in the future.

Ghana Road Fund loan default

On the road fund loan default, he said the Ministry of Finance called for a meeting between SSNIT and Ghana Road Fund on February 21, 2022.

He said at the said meeting, the ministry indicated its preparedness to see to the complete and speedy repayment of the entire facility, adding that the ministry and the Road Fund Secretariat were discussing the modalities to repay the facility.

Dr Tenkorang said SSNIT, in a letter dated March 3, 2022, proposed to the Finance Ministry to pay GH¢174,648,401 for the full settlement of the facility.

He gave an assurance that the Trust would continue to pursue the ministry about its indebtedness in order for the money to be released on time.

Ghana has subjected itself to a year-long peer review on corporate governance to streamline activities of the Government and businesses to serve as catalyst for the implementation of the African Continental Free Trade Area (AfCFTA) agreement.

The targeted review, which is in line with the African Union (AU) principles and guidelines on corporate governance, is to help address the development and empowerment of the dominant sectors of the private sector.

The private sector players that the corporate governance practice will be beneficial to, include Micro-, Small and Medium-sized Enterprises (MSMEs), informal sector and family-owned businesses as well as multinationals and listed and unlisted firms.

A review team, led by Mr Abdoulie Janneh, African Peer Review Mechanism (APRM) Eminent Person responsible for Ghana, will be in the country from March 14 to March 27 for the review process with various stakeholders.

Thereafter, a report will be tabled at the AU forum, where it would be peer reviewed before its launch, as well as the dissemination and implementation of the outcome of the report.

The announcement of the review process was done at an editors’ forum with editors of various media organisations in Accra, organised by the National African Peer Review Mechanism (NAPRM).

Mr Laud Mansfield Baddoo, Eminent Person, NAPRM Governing Council, said the review would help equip Ghanaian firms to improve their operations and access investments both locally and foreign to harness the opportunities at AfCFTA.

He added that effective corporate governance was a vital tool to enable the private sector to develop and grow, and urged all organisations, irrespective of their size and operations to adhere to accepted standards.

Madam Winnifred Akoto-Sampong, Acting Executive Secretary of National African NAPRM-GC, said report had shown that Ghanaian private sector businesses were not taken advantage of trading opportunities of AfCFTA.

“We have a $1.3 billion market, so we want to understand and address the issues so we can sustain ourselves as a continent without running to others,” Mad Akoto-Sampong, added.

Mrs Gifty Afenyi Dadzie, who represented the Chairman of the Governing Council, NAPRM-GC, said the review was strategic and unique because it was tied to AfCFTA implementation.

She said: “It is the first of its kind and would result in Ghana setting another enviable record of being the first to be peer-reviewed under AfCFTA, after setting a similar record as the first nation to be peer-reviewed on all four APRM pillars in 2006.”

She added that: “Our focus, therefore, is on how Ghana should accelerate its preparedness to take full advantage of AfCFTA for sustainable economic growth and development.”

Bank of Ghana has assured the Public Accounts Committee of Parliament that it will provide the requisite documents on the ounces of gold used for the first consignment of the gold for the oil deal.

In January 2023, the government received 40,000 metric tonnes of oil under the deal as part of efforts to offer much cheaper fuel options.

Industry experts such as the Institute of Energy Securities and COPEC have called on the government to disclose the quantity of gold it exchanged for the 40,000 metric tons of fuel as they raised questions over the viability of the deal.

Speaking at the Public Accounts Committee sittings, the First Deputy Governor of the Bank of Ghana, Maxwell Opoku Afari said the details of the transaction would be presented before the committee in due course.

“What I can confirm is that the gold is being purchased in local currency [in cedis] so it is a conversion of our local assets into foreign assets, and then it is being purchased at the world market price. We use the Bloomberg and Reuters market prices to purchase the gold.”

“I will beg the committee because I do not have the full details now… the details of the transaction would be presented before the committee in due course.”

Meanwhile, the government has disclosed that the gold for oil policy would not immediately lead to a reduction in fuel prices until more consignment arrives in Ghana.

The Deputy Energy Minister, Andrew Egyapa Mercer, said the government didn’t expect the prices of fuel to change immediately with only 10 per cent of the total deal.

The expectation was that the arrival of the 40,000 metric tons would reduce the pressure on forex and also present the country with cheaper fuel, but that has not been the case as fuel prices have increased twice within the period upsetting the majority of Ghanaians.

“It wasn’t our expectation that it [gold for oil policy] will have an overnight effect because there are stocks that are already on the market, so you cannot expect that an injection of 10 per cent of the gold for oil policy will suddenly change the pricing dynamics. It is a process and not an event.”

The Ghana National Gas Company (GNGC) on Friday signed a Project Implementation Agreement with its joint venture partners to construct a second Gas Processing Plant (GPP Train 2) at an estimated cost of US$700 million.

The gas plant would be sited at Atuabo in the Ellembele District of the Western Region and is expected to be completed within 24 months.

It would generate 1,500 direct and indirect jobs within the Atuabo power enclave.

At the signing ceremony in Accra, Dr Benjamin K. D. Asante, the Chief Executive Officer (CEO) of the GNGC, initialed for the Ghana Gas while Dr Hilton John Mitchell, a representative of the Consortium, comprising the Integrated Logistics Bureau Limited, Jonmoore International, Phoenix Park Limited and African Finance Corporation, signed for the rest of the partners.

The construction of a second train gas processing plant with a nominal capacity of 150 million standard cubic feet per day (MMscfd), expandable to 300 MMscfd, to process incremental raw gas volumes from the Greater Jubilee and TEN fields.

The project formed part of the GNGC’s strategic development plan and expected to increase the national gas processing capacity to 450 MMscfd.

The new gas processing facility will process raw gas with natural gas liquids (NGLs) being fractionated into pure components like propane, butane, pentane and stabilised condensate components from the Jubilee and TEN Fields.

The lean gas containing methane and ethane shall be tied into the lean gas export from existing GPP Train 1 and delivered into the onshore export pipes.

Some of the components of the GPP Train 2 include the construction of a 150 MMscfd capacity processing plant, expandable to 300 MMscfd, a storage facility, an additional compressor package at Atuabo Mainline Compressor Station and provision of utilities and liquid waste treatment system.

Speaking at the signing ceremony, Mr Kennedy Ohene Agyapong, the Board Chairman of Ghana Gas, said the project, upon completion, would enhance the operations of the GNGC and further boost the utilisation of the country’s gas resources for the Government’s industrialisation agenda.

Mr Agyapong, also Member of Parliament for Assin Central, said the facility would play a critical role to help Ghana achieve her energy transition objectives of using renewable energy sources for industrial purposes and reduce the global carbon emissions.

Dr Asante, the CEO of Ghana Gas, said the project would enable it to become a fully integrated gas services company and provide reliable supply of gas and gas derivatives in Ghana and West African Sub-region.

It would further fulfill the Company’s vision of supplying gas in a cost-effective and environmentally friendly manner, he said.

The new plant, upon coming on stream, he said, would improve the output of liquids processed from natural gas to 80 per cent, compared to the existing facility, which produced between 40 and 50 per cent of gas liquids.

Dr Asante added that the plant would help the nation to generate more megawatts of electricity and ultimately resolve the perennial power outages (dumsor) experienced in Ghana.

The by-products from the processed gas, he explained, could be used to manufacture fertilizer, which would boost the agriculture industry and ultimately reduce the country’s fertilizer import.

Mr Egyapa Mercer, a Deputy Minister of Energy, on his part, said the project would be a useful additional infrastructure in the country’s power generation system.

It would also support the government’s efforts in providing an alternative power supply to drive socio-economic development, he added.

Dr Hilton John Mitchell, who spoke on behalf of the joint venture partners, expressed the Consortium’s commitment to work collaboratively with the GNGC to deliver the gas processing plant on schedule and in a cost-effective manner.

The Ghana National Gas Company was established in July 2011 as a limited liability company with the responsibility to build, own and operate natural gas infrastructure required for gathering, processing, transportation and marketing of gas.