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Gov't must explain to Ghanaians why it terminated PDS deal - Group

A political think tank, Governance Watch Ghana has waded into the controversial cancellation of the electricity deal with the <a href="https://www.pulse.com.gh/news/local/suspending-pds-agreement-shows-govts-super-incompetence-ndc-mp/f021sp5">Power Distribution Service</a> (PDS) in October 2019.
PDS ECG
PDS ECG

The government through the Informational Ministry said it has suspended its concession agreement with PDS.

The decision was taken after some fundamental and material breaches were detected on the part of PDS.

A statement signed by sector Minister, Kojo Oppong Nkrumah, said some breaches in PDS' obligation in the provision of Payment Securities were detected.

"The Government of Ghana, through the Ministry of Finance and the Electricity of Ghana, has suspended the concession agreement with the Power Distribution Services (PDS) Ghana Limited with immediate effect," the statement said.

"The decision follows the detection of fundamental and material breaches of PDS’ obligation in the provision of Payment Securities (Demand Guarantees) for the transaction which has been discovered upon further due diligence.

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"The Demand Guarantees were key prerequisites for the lease of assets on 1st March 2019 to secure the assets that were transferred to the concessionaire."

But the group said the government owes Ghanaians an explanation for the cancellation of the electricity deal with PDS.

In a statement issued on Monday, March 9, 2020, and signed by Stephen Kwabena Attuh, Executive Director, said: "Government may have forgotten it still has obligations towards the Ghanaian public on the matter of Power Distribution Services (PDS) on the state of the loss that has accrued to Ghana following the withdrawal of the US$190 million outstanding obligation on the US Government under Compact II of the Millennium Challenge Corporation that was aimed at putting the power distribution sector in shape and to improve on its efficiency.

"PDS had operated from the 1st of March, 2019 until July 30, 2019, when the government officially announced its suspension following what government said were “material breaches”. Before the release of this statement, the Minister of Energy, John Peter Amewu described the PDS documentation leading to their takeover of the Electricity Company of Ghana (ECG) as fraudulent and proceeded to state that fraud vitiates a contract.

"At about the 9th of August 2019, following the few days of suspension, PDS was handed back ECG to operate. This operation was enforced until about the 23rd day of October that ECG was finally directed by the government to take over the operations of PDS with the PDS deal finally terminated.

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"For about 73 days, after the government found reasons to reinstate PDS, the operations of ECG were in their hands. The government appears to have gone to bed finally after the 23rd October 2019 termination of the PDS deal."

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