Health Minister, Kwaku Agyemang-Manu, has accused a former Deputy Finance Minister, Cassiel Ato Forson, of authorizing payments to an ambulance supplier contrary to clear terms of the contract.
Mr. Manu told the High Court the terms of the contract required that payment should not be made until the vehicles are delivered. Inspection, he explained was also to be carried out prior to shipping of the vehicles.
“….a letter was sent from the Ministry of Finance instructing the Bank of Ghana to establish letters of credit. That was authored by the first accused, Honourable Ato Forson, Deputy Minister for Finance at the time.
This letter was done without recourse to the Ministry of Health as well as the commercial agreement that was signed between Big Sea and the Ministry of Health.
There was no reference to the contract agreement that stipulated that there should be no advance payment and that the vehicles should be delivered before payment is made," Mr. Manu said.
Mr. Agyemang Manu is the state’s third witness in the case against Dr. Forson and two others.
They have been charged with various offences including that of causing financial loss to the state in the importation of 30 ambulances that formed part of a consignment of 200 under a contract signed between the Ministry and Dubai-based firm, Big Sea Limited, in 2012.
Mr. Manu on Thursday, July 2021 continued with his testimony which he had started on June 28.
He explained that after the contract for the supply of ambulances and all agreements had been approved, the government was not performing its end of the bargain. Big Sea, he explained wrote to the Attorney General serving notice of its intention to sue. Big Sea he said was unhappy that government was failing to undertake the pre-shipment inspection as had been agreed.
The Attorney General’s Office, he revealed, wrote to the Ministry of Health urging government to obey the terms of the contract or find a way out of it since it was legally binding and disobeying it will result in a judgment debt. This was after it had received the letter from Big Sea communicating its intention to sue.
He revealed the Ministry of Health replied to the Attorney General saying the contract could not be performed.
“The basic reason given was that the parliamentary approval for the financing agreement indicated that the source of funding should be from Stanbic Bank and at the time, the ministry had not been informed of any credit agreement between Ministry of Finance and Stanbic Bank so there were no funds available for execution of the agreement.”
Mr. Manu said it was after this letter was written that Dr Forson wrote to the Bank of Ghana. This move, he insisted, was contrary to the agreement.
He alleged that the first 10 vehicles arrived in the country shortly after but were found to be defective by the Ambulance Service.
Big Sea, he continued, was informed of the defect and the company accepted the defect.
The company he revealed, invited officials of the Ministry to come over to its production facility in Dubai to ensure that the defects are fixed.
This invitation he claimed did not happen because Big Sea kept postponing the date for the visit.
Big Sea he said, continued to ship some more vehicles into the country.
“The Ministry wrote back to Big Sea reminding Big Sea of the obligation of rectification (fixing defects). The Ministry of Health then wrote to the Ministry of Finance indicating its decision to suspend the contract for the supply of the ambulance,” he stated.
The Ministry of Health he explained eventually sent the technical team to engage Big Sea in Dubai but the company failed to fix the defects.
The Health Minister was then cross-examined by lawyers for Dr. Forson.
Lead counsel Dr. Abdul Aziz Bamba questioned the minister on whether Dr. Forson had simply made a request for letters of credit or authorized payment.
He argued a letter of credit is not payment. He also suggested to the health minister that nowhere in Dr Forson’s letter does he instruct the central bank.
The Health Minister, however, insisted from his understanding the phrase urgent request is synonymous to an instruction.
Question: And you are aware that LC’s are not payments in themselves but guarantees or promises of payment upon certain conditions being met?
Answer: That is so.
Question: So if the ministry of finance requests the Bank of Ghana to establish an LC that does not mean that BOG should make payment or it is authorizing payment. Right?
Answer: Yes. Finance is authorizing BOG to make payment under certain conditions.
And of course, If those conditions are not met, then payment should not be made under the LC.”
It was then pointed out to him that Dr. Forson signed the letter on behalf of the then Finance Minister Seth Terkper.
Dr. Bamba explained Mr. Terkper has since confirmed authorizing Dr. Forson to write the letter. The health minister said he was not aware. The case has been adjourned to Tuesday, July 26 for a continuation of the cross-examination.
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