04 Jun Ghana: Telco Deal Saves $68m – Ursula Owusu
The Minister of Communications, Ursula Owusu Ekuful, yesterday told parliament that the five-year renewable $89 million Kelni-GVG contract signed by this government is far better than the $150 plus contract signed by the previous National Democratic Congress (NDC) government with Subah and Afriwave which was renewable in 10 years.
The Minister said the $89 million Kelni-GVG contract will save the nation a whopping $67 million over the five years and also increase revenue from the telecommunication industry by 20%.
The Minister of Communications who was briefing the House on the contract-which had become a controversial topical issue currently-said the government went into the contract with Kelni-GVG in the supreme interest of Ghana and that there is absolutely no shred of corruption in connection with the contract.
“Mr Speaker, the fee for this transaction which is $1.4 million per month as against the $2.6 million paid monthly to Subah and Afriwave is within the industry average for Platform as Service (PaS) contracts of this nature,” she said adding the vendors have already procured and delivered equipment worth $50 million as part of the contract sum at no extra cost to the nation.
According to the Minister, this also represents significant cost savings to the nation.
“Kelni-GVG has begun the anti-fraud operation which includes injection of calls from abroad which is a direct cost element to Kelni-GVG Limited which must pay for these calls coming from countries abroad”
The Minister explained that the installation of all the equipment meant for that project is on the premises of the National Communications Authority (NCA) and that the government would take over the assets after the expiration of the contract per the agreement.
“Mr Speaker, equipment installation is almost complete and the platform is expected to be fully operational in July, this year. Some services have already commenced and all Mobile Network Operators are required to co-operate fully with the NCA,” she said stressing that Vodafone and Glo are in the process of being connected.
She therefore entreated all Mobile Network Operators (MNO) to get hooked to the services of Kelni-GVG or face a strict penalty of a fine of five per cent of the last total revenue declared by that telecom company.
The Minister explained that those who are fighting the current contract which seeks to improve on revenue generation in the telecommunication industry are those who were earning large sums of money for virtually no work done.
She said these people have their tentacles deep in the system and are very unhappy with the collapse of their lucrative business and are therefore determined to fight back but the New Patriotic Party (NPP) is very resolute and knows what is best for the nation.
“We are determined to have this project implemented and will go the full out to let this work”
“Mr Speaker, this current and hopefully, final effort to establish the Common Platform, is borne out of the unanimous decision taken at the stakeholders meeting early last year where the chairman of the Ghana Telecom Chamber who gave the presentation on behalf of the mobile network operators stressed the need for the NCA to acquire the capability to monitor traffic in the industry,” she said stressing that the Telecos have outsourced key parts of their operations including infrastructure, billing and security, so the NCA also has the right to engage whichever contractor it chooses to provide stated services.
After the Minister’s presentation on the Kelni-GVG contract, the minority members led by the Minority Leader, Haruna Iddrisu, raised serious concerns over the timing of the contract and restrictive nature of the tendering of the contract and the advance payment of $7.5 million to Kelni-GVG covering five months even though the company has not started full operations.
The Minority Leader said that the signing of the contract by the Minister of Communications which should have been done by the NCA officials is unconstitutional because NCA which is going to implement the project is an autonomous body.
The Minority also said the award of the contract did not attract any audit of value for money and that it strongly suspects that the contract was borne out of ‘create, loot and share’ system.
The Minority Leader also said that the company, Kelni-GVG does not have a good track record in other African countries where it has operated and that Ghana would be the eventual loser.
The Minority therefore called for further investigation and scrutiny into the contract at the committee level and asked the Speaker to subject the contract to that independent enquiry at the committee level by the Committee of Communications of Parliament.
The First Deputy Speaker, Joseph Osei-Owusu, who was presiding, declined referring the matter to the committee for further interrogation explaining that the invitation given to the minister to come and brief the House was about the contract and that as far as he was concerned, all the doubts about the contract had been cleared by the Minister.
The Majority Leader, Osei Kyei-Mensah-Bonsu, advised the minority members to present anything that they think could improve on the contract in the form of a memo to the leadership of parliament and that would be forwarded to the appropriate quarters for consideration.