Gov't chasing $1bn revenue with $89m contract but IMANI cries foul

Gov't chasing $1bn revenue with $89m contract but IMANI cries foul
Source: Ghana||Edwin Appiah|
Date: 21-05-2018 Time: 11:05:06:am
George Andah

A government plan to chase $1bn in revenues from telcos through an $89 contract to a private company has been faulted by policy think-tank IMANI.

IMANI has branded as "totally needless", the contract which seeks to extract more revenue from the telcos by monitoring calls and checking SIM box fraud.

IMANI President Franklin Cudjoe has also questioned the credibility of the selected company, GVG.

The selection of GVG is the third and latest attempt by the government to ensure that telcos do not under-declare their call traffic on the basis of which tax revenues are calculated.

If the government could find a system that can verify how much telcos really make, it could then confirm if the declared revenues are accurate.

This was why Subah Infosolutions was selected in 2010 and later ditched over public concerns that the contract did not offer the taxpayer any value for money.

Afriwave company Ltd was next in 2015 but soon went the way of Subah, this time over concerns that it did an inferior job.

GVG has been selected through a restricted tendering process to build, operate and transfer a revenue-monitoring system over five years at a cost of $89M.

Deputy Communications minister George Andah has said this contract is 55% cheaper than the previous two contracts and does two more functions than them too.

He said GVG apart from monitoring calls in real time can also monitor the new space of mobile money transactions. 

"There is no push back from the telcos" Mr Andah said and listed the cooperation of GLO and MTN as examples of collective support from the telcos.

But these companies have only raised concerns about the privacy of calls and cybersecurity, he said on Joy FM's Super Morning Show Monday.

If government focuses on monitoring calls alone it could make a conservative $700m over five years, he said. But if new monitoring territory like mobile money operations are also included, government "could easily be making a billion dollars", he hyped.

Unconvinced, IMANI President Franklin Cudjoe argued the international calls monitoring idea is against international law. He said the fraud within the telcos which government wants to check was created by government albeit unwittingly.

SIM Box fraud is when third-party operators make money off telcos by interfering with their systems to route calls.

Franklin Cudjoe argued SIM box fraud occurs in environments where call tariffs are high creating an incentive to go for cheaper illegal options.

Nigeria and South Africa, he said, eliminated this by lower charges on calls and Ghana should do same, the policy expert advised.

He said with technologies like Whatsapp and Viber, people can now make cheaper international calls without the need for expensive legal options like the telcos or cheap illegal options like SIM box fraud.

Franklin Cudjoe also said GVG was chased out of Tanzania over poor performance.

But the deputy minister called this claim as false. He said in Tanzania as well as Liberia and Senegal, GVG is thriving and has gone on to get their contracts renewed.

George Andah admitted SIM box fraud is created partly because of higher tariffs on calls but was quick to add that this is not the only reason fuelling the crime.