President cannot claim innocence - Koi-Larbi
Osafo Maafo ignores cabinet- President is upset
PNC
kicks against MPs car loan
'Decision
on $20,000 emanated from Parliament'
Judges may accept car loans-Akufo Addo
Accra (Greater Accra) 23 November 2001 - Nana Akufo-Addo, Attorney-General and Minister of Justice, on Thursday said a car loan scheme may appeal to Judges but a decision on the issue would have to emanate from the Judiciary.
"Car loans for Judges! Well, if that is the best way to improve on their mobility, I am sure they would take it but as you know I can't speak for them."
Nana Akufo-Addo was answering a subsidiary question posed by Dr. John Abu, NDC-Amenfi Central, on whether judges would be given loans to buy cars.
Nii Adu Daku Mante, NPP-Osu Klottey, had asked an urgent question, demanding the category of persons in the Judiciary, who are provided with vehicles for their official use and what the condition of the use of the said vehicles are.
The Minister said according to the conditions of service of Superior Court Judges, each judge is entitled to chauffeur driven car.
He said in September 1996, government acquired 6 Audi cars for Supreme Court Judges, 4 Audi cars for Appeal Court Judges and Toyota Corona cars for High Court Judges and Chairmen of Regional Tribunals.Nana Akufo-Addo said: "The understanding was that such cars were to be used by our Judges for five years after which they were to be boarded and sold to the assignees. This is, however subject to government ability to replace them."
Nana Akufo-Addo said:" Most Judges now drive these cars without functioning air-conditioners and several have had to either maintain the cars and provide tyres and batteries themselves as the high cost of maintenance can no longer be contained by the approved budget for the Judicial Service."
He said the only prudent alternative is to replace the cars. According to the Minister, 14 High Court Judges and 2 Chairmen promoted in January 2000 have no cars. He said Judges of the inferior Courts are not entitled to official cars.
Ten Judges including the Chief Justice form the Supreme Court, 18 Judges make up the Appeal Court while 41 Judges administer High Courts. There are 17 Chairmen of Regional Tribunal across the country.
GRi…/
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Sekondi (Western Region) 21 November 2001 - Mr Ebow Bentsi-Enchill, a leading member of the Convention Peoples' Party (CPP) has called on Parliament to reduce the car loans to be granted to Members of Parliament (MPs), from twenty thousand dollars to ten thousand dollars each.
Speaking at a reception organised by members of the Sekondi constituency branch of the party after a fund-raising rally at Sekondi, he said the MPs could use the cedi equivalent of ten thousand dollars to purchase a good car on the Ghanaian market.
He said since some MPs had not completed paying the car loans given them during the last Parliament, they should not be saddled with more loans.
Mr Bentsi-Enchill said though MPs must be made mobile to enable them to discharge their duties effectively, the state of the economy must be considered before deciding on the amount to be given them for the purchase of cars.
He called on Parliament to debate on the matter before action was taken on it to show that the current political administration was transparent.
He also called on Ghanaians to come out with concrete suggestions on issues discussed in Parliament, to which they held contrary views instead of merely condemning MPs.
GRi../
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Accra (Greater Accra) 22 October 2001
- Our poor MPs have taken a severe beating from the media and the Internet chat
rooms (especially Okyeame and SIL) for their recent attempt to
"borrow" 28 billion cedis ($4,000,000) from the already bankrupt
consolidated funds to help them acquire cars. In a rare show of agreement, MPs
of both the NPP and NDC justified the need for the "loan" arguing
that the cars will facilitate their work in parliament and allow them to stay
in touch with their, mainly rural, constituents. The majority chief whip, in a
telephone interview on "SKY FM", wondered why there was such a public
outcry since "MPs were going to pay back every penny of the loans."
In yet another
"asagonomic" statement, Moses Asaga emphatically declared that
"this time around, I think all ministers, who are MPs must be allowed to
access the loans so that when they are no longer ministers, they will still
have a means of reliable transport to tour their constituencies."
Not to be outdone, the minority
chief whip, Doe Adjahoe, added that "the resolution of the issue is
crucial because it is a matter which would keep coming up and so there should
be a consensus as to how to deal with it, to prevent recurrence."
This will be the third term for
some MPs, like Adjahoe, and perhaps a third time to drink from the fountain of
"consolidated fund car loan". Appropriately, but perhaps belatedly,
the executive has attempted to distance itself from this loan proposal. Mr.
Kwabena Agyepong, the deputy press secretary, speaking to the media made it
rather clear that "the whole
project from conception to the final decision emanated from parliament."
Various news reports indicate that the president was outraged and convened a
hasty meeting between the executive and representatives from parliament.
Regrettably, that meeting did not clarify matters and ended with a terse and
confusing statement that "government will help source loans for MPs to
purchase their own vehicles."
On a positive note, President
Kufuor should be congratulated for temporarily halting the "loans".
On the negative side, the decision to help source loans for MPs is a
non-starter because the current conundrum is a by-product of the government
trying to help source loans for MPs from the consolidated funds.
The car loan saga raises two interrelated
issues: (1) when is a loan not a loan? (2) do our MPs need cars and, if so,
what is the best way to solve the transportation problem? Unlike most
commentators, I have no problems with MPs or anyone acquiring a loan to buy any
asset. However, where I differ, from most commentators, is that I do not
consider the 140,000,000 cedis ($20,000) "loan" proposal as a loan
proposal at all! Rather, I consider it as a gift, sloppily disguised as a loan,
from the consolidated fund to the MPs. I base my conclusion on the purported
loan amount (140,000,000 cedis each), purported monthly instalments (1,400,000
cedis) purported payment periods (48 months) and a 30 percent interest rate.
The loan amount does not appear to be in dispute. The purported monthly instalment
is based on a statement attributable to Rex Owusu Ansah, the clerk of
parliament and reported by various
media. No MP has challenged this amount and a September deduction has,
allegedly, already been effected. The payment period is based on the history of
similar loans to MPs in 1993 and 1997, which I will focus on shortly. This
duration has also not been contested by the MPs.
The interest rate is based on Mr.
Obetsebi-Lamptey's statement, of 15/10/2001, that the NPP had lowered interest
rates from 40 percent to 30 percent while addressing the chiefs and people of
Akuapem at a durbar to mark their annual "Odwira" festival. This rate
is much lower than the inter bank lending rate quoted by the bank of Ghana on
its web pages at www.bog.gov.gh which hovers around 40 percent. However, I
suspect, as in 1992 and 1996, that the proposed loan would have carried
concessionary terms providing justification for the use of the more
conservative 30 percent.
To understand how our MPs were
using this loan proposal as a means to "steal" from the consolidated
fund requires a little discussion of the mechanics of a loan. A loan is nothing
more than a contract which commits a borrower to make a series of specified
future payments to a lender in exchange for an immediate consideration that the
borrower receives from the lender. The loan contract is consummated because the
lender and the borrower have different time preferences for money. The MPs want
the money today to buy their cars and promise to repay the consolidated fund at
a future date. The trick to making the contract workable is a concept, called
present value, which simply requires the MPs to return to the consolidated fund
an amount in the future that is worth the same amount of money that they are
borrowing today. This is where the interest rate comes in.
Consider an example of an MP who
borrows 1,000 cedis when the interest rate is 30 percent and promises to pay
this amount at the end of the year. The MP must pay 1,300 cedis at the end of
the year to cover the principal and the interest. If he pays only 1,000 cedis
then he has "stolen" 300 cedis from the lender. The lender demands
1,300 cedis because he could simply dump the 1,000 cedis in a bank and allow it
to grow to 1,300 cedis. The interest rate acknowledges things like inflation
and riskiness. Put another way, "a cedi in hand now is worth thirty next
year" a saying that is easily understood by any Ghanaian.
Which brings us back to the MPs
attempt to borrow 140,000,000 cedis from the consolidated fund. Given a payment
term of 48 months and a concessionary interest rate of 30 percent, what should
be the monthly instalment on the loan? The answer turns out to be 5,040,839.13
cedis, which is significantly higher than the 1,400,000 cedis that is being
quoted as the instalment amount on the proposed loan. So exactly what is a
monthly payment of 1,400,000 cedis over 48 months worth? Well this is sad news.
It turns out that 48 sequential monthly payments of 1,400,000 cedis, at an
interest rate of 30 percent, is only worth 38,882,415 cedis. The difference of
101,117,585 cedis (140,000,000 - 38,882,415) would have been a clever transfer
from the consolidated fund to the MPs. It is important to understand that this
calculation is based on the 30 percent interest rate and the 48 months.
If one changed these assumptions, one would come out with different numbers but the same qualitative results. By way of sensitivity analysis, consider the situation where the loan was given at zero percent interest rate for 48 months. Even making this highly unrealistic and certainly foolish assumption, will still imply that the MPs will only be paying the equivalent of 67,200,000 cedis (or $9,600). The difference of 72,800,000 cedis (or $10,400) is a net raid on the consolidated fund and can buy a nice used BMW in Europe or USA. For the deal to work at zero percent and be a real loan, the MPs must pay 2,916,667 cedis every month for 48 months.
This analysis would come as a
shocker to Ghanaians but highlights the importance of information. Thankfully,
investigative reporting by the media prevented this proposed looting of the
consolidated fund. The media has been unfairly criticized these days and it is
time we saluted them. But the analysis should lead us to ask for the full terms
of the car loans (and any other loan granted to MPs) in 1993 and 1997.
We know that 890 million cedis
were disbursed to 178 MPs to acquire vehicles in 1993. We also know that MPs
were given loans of 26 million cedis each ($15,000 at the time) in 1997 to acquire
vehicles. What we do not know for sure are the payment terms and whether the
MPs have paid the full amount of the loans using the concept of present value
as explained earlier. It is time to examine these loans carefully and retrieve
any outstanding differences plus interest and penalties. The trick is to go
back and base these loans on interest rates prevailing at the time when the
loans were made.
Incidentally, the same issues
arise for the houses that were purportedly built for MPs and ended up being
sold to some of them. That, too, requires investigation and analysis. It is
time, once again, to remind our public officers that there will be significant
consequences sometime, somehow, somewhere for those who cause financial loss to
the state. In this light, I was horrified by a Daily Graphic report that
"attempts to find out at the GCB the exact percentage chargeable on the
loans, as well as the details of the terms of the repayment, were foiled, as
officials were tight lipped." How can we the people, who hire these MPs,
not have access to any and all financial contracts that they sign with the
republic? Any loans drawn on the consolidated funds by any public officers as
well as salaries, allowances, per diems, etc. should be "sunshined"
(i.e., made publicly available in the media and on the internet).
With regard to the second
question, I agree with our "mmobrowa" MPs that they need cars to
allow them to function effectively. Unlike most workers, our MPs are forced to
relocate out of their homes to work in Accra and are required by the nature of
their jobs to be in close and constant touch with their constituents. I also
agree with Doe Adjahoe that this is a problem that will not go away. We faced
it in 1992, 1996, now and we will face it in 2004. It is disappointing and
raises serious questions about the state of the mind of our MPs who continue to
propose the same selfish solution to this real problem. The solution is not
giving individual MPs "loans" to buy their personal cars but rather
acquiring official vehicles for each constituency that is owned and maintained
by the state. Each of those vehicles should be given a constituency number
plate (e.g., MP Abetifi).
In concert, with the Auditor General
department, each MP should be allowed a generous mileage allowance based on the
location of his constituency and the commute within Accra. The odometer should
be audited every year and MPs charged for exceeding the mileage limits. This
will ensure the vehicles are used for only official purposes. As long as the
state acquires good vehicles, I believe these vehicles could be used for 3
cycles of parliament (12 years).
This will take care of the
"Asaganomic" mentality which says acquire a car as an MP so that when
you are no longer an MP you will still have a car." Of course, any MP
should feel free to go to any bank to borrow at the prevailing interest rates
and pay the appropriate instalments, as indicated by a present value analysis.
If an asset recovery team is put together to work out the correct figures on
the 1993 and 1997 loans, the amounts retrievable by way of error correction,
forgone interest and penalties should be enough to buy 200 vehicles that will
be allocated to each constituency to be used by each incumbent MP. We shall be
watching them. Source: Accra Mail
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“President knew of car loan agreement”, says Bagbin
The
Minority Leader in Parliament, Mr. Alban Bagbin has described the President's
stance on the MPs car saga as unfortunate and an indication that there is no
team work in the governance of the country.
"For
the President to claim innocence of this issue is a bad indication about how
the country is being run. If the
Minister of Government Business would go to the extent of hiding such an issue
from the government, then it owe that his cabinet is not clicking well,"
he said.
In an
interview with the paper in Accra at his office on the MPs need to procure new
cars for their official duties, Mr Bagbin noted that this was a normal thing
that should be done since the cars bought for them for the four-year period
depreciate in value.
The Minority
Leader said the issue of the 20,000 dollars for the acquisition of vehicles was
discussed and accepted at the Majority Chief Whip's office where Mr J.H. Mensah
was present for the discussion.
He said the
discussion has been on going since May and that the President was fully aware
because letters were copied to his office and the Minister of Finance. Mr Osafo Maafo who also confirmed that the
maximum money the government could guarantee was the proposed 20,000 dollars.
In a letter
dated September 4, 2001, written and signed by Mr Yaw Osafo Maafo, the Ministry
of Finance approved an inclusive credit ceiling of 20,000 dollars to be granted
each Member of Parliament to purchase a car for official duties under a hire
purchase agreement. This, he noted, was consistent with similar arrangements
made for MPs in 1997.
It went
further to state that each MP will select a vehicle of his/her choice provided
that the cost of Insurance and Freight (CIF) value of such vehicle, together
with taxes and comprehensive insurance cover for the first year does not exceed
the proposed 20,000 dollars.
It spelt
out that "any additional cost over the above 20,000 dollars ceiling for a
vehicle that may be selected by on MP will be paid by the affected MP to the
car company.
Installment
payments for each Member of Parliament will be deducted at source with effect
from the end of September 2001 at the rate of ¢1.2 million per month".
Mr Bagbin
later expressed dismay over the President's outrage for the number of cars
Ministers were using vis-à-vis the cars the MPs are using for their numerous
official duties.
"I
think that as a country, if we want to develop democracy in Ghana, then we
should not shy away from telling the truth by claiming the alibi of ‘ I’m not aware
of it syndrome,’ ” he exclaimed.
"If
for this time the President is not aware of this, then God save us." Mr
Bagbin further explained that the Speaker of Parliament, Mr Ala Adjetey was
aware of the fact that there were some vehicles that were due MPs.
He said it
was outrageous for the Speaker to deny flatly that the he had no idea on the
acquisition of the vehicles for the leadership of the House.
A letter
dated September 20 which was shown to us indicated discussions held between the
Speaker of Parliament and the Finance Minister on the acquisition of vehicles
for the leadership of the House and the Parliamentary Service Board which
accordingly approved the purchase of Mercedes Benz MI 270 CDI at the cost of
¢376 million and other vehicles totaling ¢3.5 billion.
Meanwhile
the office of Parliament is reported to have taken delivery of the vehicles for
their use.
GRi…/
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Accra (Greater Accra) 18 October 2001-Papa Owusu-Ankomah, the Majority Leader, on Wednesday said the process for the acquisition of cars for Members of Parliament (MPs) was ongoing and not "a done deal."
"MPs need to have cars as a matter of necessity to do their work. In fact MPs commute more than any professional I can think of at the moment."
The Majority Leader, who is a day old in office, told the Ghana News Agency (GNA) in an interview that "The options for making the legislators mobile are many, and we are still in the process of looking at the most viable option in view of the country's economic circumstances."
He said it was unfortunate that the country's historical circumstances have made the public less appreciative of the work of the MP.
Papa Owusu-Ankomah said the MP being the elected representative of the ordinary person was more sensitive to public opinion.
He said it was necessary for Ghanaians to be sympathetic and understanding for the MPs to be effective in the discharge of their duties.
On the deduction of the first instalment of the car loan from the MPs September salary, he said, "it was an interim measure taken pending the final determination of the process".
He said as a Leader of the House, "it is my responsibility to see to it that MPs get cars to enhance their work for the legislature to operate in a democratic environment.
"My wish is to work with all MPs to improve on the capacity of Parliament and make it very independent. I know that is the vision of the President." He said: " After all Parliament is the bulwark of democracy. We have decided to embrace the concept, so let us keep going."
Sources close to Parliament told the GNA that the MPs harped on the issue all day, behind closed doors after spending just 10 minutes for normal sitting.
GRi…/
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The people have spoken - 80% say no to MPs
loan
In a first-of-its kind public survey conducted by The Statesman, 80.4% of the 811 callers who participated said no to the scheme to give MPs a $20,000 loan each to buy a vehicle. Only 133 (19.6%) of members of the public who voted were in support of the loan. The Weekend Statesman, gauging the public's reaction to the initial news of the $20,000, first, conducted a small straw poll of the streets of Accra and found people united against the loan.
It was then decided that a nationwide telephone survey would give a far scientific sample of what Ghanaians generally felt. Callers from as far as Wenchi, Tamale, Aflao and Techiman were asked, "Should your MP receive a $20,000 state-funded loan to buy a car?" 678 gave it a massive thumbs down.
The President's move at the weekend to suspend executive approval of the loan appears very well placed as results of our poll suggest.
In a related development, The Statesman's attempt to get the Clerk of Parliament to furnish it with a list of all the MPs of the last two Parliaments who had failed to pay back their loans was futile. Amazingly, Parliament doesn't seem to have available the exact figures of loan defaulters and yet was prepared to grant another set of loans at an even higher rate to its members. The Clerk argued that a different set of Staff dealt with the old loans and, therefore, he was not able to locate the documents showing how much was owed and by whom. - The Statesman.
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President cannot claim innocence -
Koi-Larbi
Accra (Greater Accra) 16 October 2001 - President Kufuor's claim that he was not part of the failed attempt to give each Member of Parliament (MP) $20,000 car loan has been debunked by Hon. Agyare Koi Larbi, the maverick NPP member for Akropong.
In an interview after last Friday's Odwira Grand Durbar organised at Akropong, Koi Larbi also justified the public outcry over the deal, citing the current precarious economic conditions as making such a dole-out unacceptable.
"We have to presume that whatever the Minister of Finance does, he does it with the consent and concurrence of the President and the entire Cabinet. And so it is with the man in charge of Government Business," the Akropong MP argued. He stressed that once the Majority Leader was involved in the transaction, nobody can disown any responsibility.
"I think the Executive and everybody was aware". Though an MP himself, Koi Larbi said he was personally against the idea of the government directly giving out the $20,000 or any amount for that matter, to the MPs as the car loans. What can be done, rather, is to ask the MPs to take loans from the banks whiles Parliament guarantees the payment.
"This way, it will become a simple commercial transaction and the risks involved will be taken by the MPs and not Parliament per se". In the event that a particular borrower is unable to pay before he leaves office, then his end-of-service benefits could be used to defray the remaining loan.
Asked to tell the upper ceiling of the amount which would be realistic, he answered that the "reasonability of the amount will depend on the salaries of the MPs and what their ESBs are likely to be".
He further suggested that priority attention must be given to new entrants to the Legislature who may be in dire need of cars to make them mobile, as opposed to making the exercise a wholesale one.
While this may be adopted to satisfy an urgent need, the Akropong MP thought it prudent to solve the larger problem of making cars affordable to many people in the country as a whole in the long run.
In that direction, he called on the government to use its large procurement policy to get one of the European or American car companies to set up a car manufacturing company in Ghana.
"If we are prepared to contract such a company to manufacture, say 80% of all the parts here, not just assembling them, but manufacturing them here, it will be better and cheaper for everybody and not just a selected few always," Koi Larbi argued.
He cited the existing agreement between the Nigerian government and Peugeot Auto Company of France as an example to emulate adding that what would be required would be for the government to order most of its buses and cars from it.
When drawn, albeit grudgingly, to comment on the President's reshuffle of last Thursday, the MP said a reshuffle is the prerogative of the Chief Executive. "Whether he does it rightly or wrongly will be his responsibility finally."
Pressed to comment on the suitability of those involved in the exercise, he declined saying "I don't know what he has seen in them so it is up to him but at the end of the day he takes the ultimate responsibility."
In obvious reference to his sometimes unorthodox views and unpopular stance on national issues, Koi Larbi made a philosophical statement. "Winston Churchill was saying so many things people did not believe, Chamberlain did not take anything of his seriously. But when the time came finally, Churchill had to come and implement his ideas." - The Chronicle
GRi../
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Accra (Greater Accra) 12 October 2001 - As public outcry over the $20,000 vehicle loans for MPs hots up, the Speaker of Parliament, Peter Ala Adjetey, has come out to defend the necessity for the loans. He says it is very necessary that MPs have their own means of transport to enable them to discharge their parliamentary and constituency duties efficiently.
"Democracy is very expensive and our going HIPC doesn't mean that certain necessities and obligations should not be undertaken," he told The Statesman in an exclusive interview in Parliament House on Wednesday.
The Speaker made these observations in reaction to public criticism against the decision by Parliament to grant $20,000 loans to MPs to acquire vehicles.
"Without cars they can't visit their constituencies and attend to parliamentary duties. If the state can give them loans to discharge their fundamental duties, it should be implemented," he said. The Speaker said this is not the first time that Parliament has provided MPs with cars and "this should be done on its merits and not be rejected on emotional and narrow political grounds.
He recalled that the Limann government granted such facilities to MPs and this should not be the last time to deprive MPs from being granted loans.
The Speaker noted that the fact that the facility is a loan, t he public must show some amount of restraint and not condemn the decision because the $20,000 loan would be refunded by the MPs who enjoy the facility, as it has happened in previous Parliaments.
"It's a facility for only those who need the loans and it should not be misconstrued as free gifts for the current MPs.
The Speaker, therefore, appealed to the public to consider the onerous duties being performed by the MPs. "Some of the criticisms are just empty hue and cry and a lot also have political undertones because everything reflects on government," he added.
Rex Owusu-Ansah, Clerk of Parliament, said the loans would be repaid by recipients, as was done in the First and Second Parliaments.
Asked whether the previous recipients of the loans granted by Parliament in 1993 and 1997 had fully repaid their loans, the Clerk confirmed that there are a few of the MPs who are yet to fully repay.
"Most of those who have defaulted are those who lost their seats in 1996 and 2000. A few others in the current Parliament are still paying. Efforts are being made to locate those who lost their seats to retrieve the remaining amounts," he said.
Owusu-Ansah said deductions of ¢1.2 million from the September salaries of all but Ministers and Deputies who are MPs, were made to make accounting easier. Those who decide not to take the loans would have their deductions would have their deductions refunded to them.
"The offer is not compulsory and MPs who are Ministers and Deputy Ministers are not included, since they have free use of vehicles," he added.
In a related development, the Speaker has denied that a brand new, four-wheel drive Mercedes Benz vehicle has been allocated to him is one of five acquired by Parliament. "No vehicle has specifically been bought for the Speaker," he said.
The Speaker who was reacting to an allegation in an Accra weekly that Parliament had acquired from him a $60,000 4WD insisted that the only official vehicle allocated to him is an Audi saloon car, which was the official car of the former Speaker, Justice D.F. Annan.
Speaking to The Statesman in an exclusive interview at Parliament House last Wednesday, Mr Adjetey explained that the Parliamentary Service Board (PSB) took the decision to acquire five 4WD vehicles into the pool of vehicles of the House, since Parliament could no longer rely on the Executive for vehicles. The five vehicles are a Mercedes, two Toyota and two Nissan, all 4WD.
The Speaker said he personally inspected the first batch of the fleet that consisted of one Toyota and one Nissan Land Cruiser when they were delivered a couple of weeks ago.
The Mercedes Benz, he said, was later delivered to this house last weekend when he was unwell and could not be at Parliament House, to inspect it.
"I, however, objected to the Mercedez Benz because what I saw was sufficient to make me a litter dissatisfied with it," he noted, adding "It was not the latest 2001 model we asked for."
Mr Ala Adjetey said Silver Star Motor Company, Mercedes Benz dealers, have since agreed to replace it, because there is an offer from another customer.
Parliament, he said, needs its own pool of vehicles that can readily serve the House; his official Audi saloon car has been on and off the road, he said.
"There is the need for the Speaker to be given an up to date saloon car of the standard which I personally own, and which I use because the official vehicle is unreliable."
Meanwhile, the Mercedez Benz (GT 54940 S) and the Toyota
Land crusier (GR 9409 S) are parked at the Parliament House car park. - Weekend
Statesman
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$20,000 to MPs is 'state robbery'
Accra (Greater Accra) 12 October 2001 - Mr I.K. Obeng, a former PNDC Secretary for Religious Affairs, has described as "state robbery", the proposed 20,000 dollars to be given to Members of Parliament (MP) as car loans.
He made the observation in an interview with "The Evening News" in Accra today. According to him, the state is being robbed of vital funds which could be channeled into very important developmental projects of urgent need.
"At a time when Ghana has gone HIPC utility tariffs have risen and general prices have gone up, life has become unbearable to Ghanaians," he lamented.
He, therefore, argued that 20,000 dollars to 200 parliamentarians which runs into a total of about ¢28 billion can be channeled into vital areas of the economy to ease the economic pressure on Ghanaians.
Mr Obeng decried the situation where the lifestyle of politicians have taken sudden turn the moment they entered into parliament. "A politician without a bicycle becomes rich overnight by becoming a parliamentarian, a position he holds by virtue of being elected by the ordinary people to serve them," he said.
To become an MP, he contended, one should be prepared to sacrifice in his service to the state and the ordinary people who voted them to parliament to represent their humble view.
The voters, therefore, expects MPs to help in formulation of policies that will help alleviate their sufferings, he said.
But unfortunately, he mentioned with regret, the opposite has turned out to be the case as MPs have sought their personal welfare at the neglect of the ordinary people.
Mr Obeng said most of the present MPs have already benefited from car and housing loans and in the last parliament. "Of what importance is a car and housing loan to such MPs since they have already benefited from this facility from the last parliament?" he queried. - Evening News
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Accra (Greater Accra) 12 October 2001- Greater Accra Youth Wing of the New Patriotic Party (NPP) said on Friday that the decision by Parliament to grant its members a loan of 20,000 dollars each to buy cars is an "affront to the integrity of the electorate".
The youth wing said in a statement in Accra that the act ''is a revelation of the insensitivity on the part of our Members of Parliament and their self seeking nature''.
''Their demand, in our view, is highly outrageous, devoid of any critical examination and consideration of the state of our economy.'' The statement said the timing of decision, coming at a time when people are overburdened with tax, is wrong and in bad faith.
GRi../
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Osafo Maafo ignores cabinet- President is
upset
Accra (Greater Accra) 10 October 2001 - The Minister of Finance, Yaw Osafo Maafo, appears to have taken another major decision without consulting J. A. Kufuor, the president, and this time, he has reportedly upset him.
Mr Maafo's letter to the Majority Leader, J. H. Mensah from which details of an intended advancing of 20,000 dollar loan each to Members of Parliament was made public, has attracted so much public criticisms and raised doubts about the government's sensitivity to the socio-economic plight of the populace.
Not only was the Pesident unaware of the details of the deal, even the Deputy Minister of Finance, Dr Adombire Agambila was not aware. This, however, is not the first time Mr Maafo has fault-started. A couple of months ago, the Finance Minister appointed the deputy Governor of the Bank of Ghana, Mr Asiedu Mante, to assume responsibility of the Central Bank and publicised it, only for President Kufuor to set that decision aside and re-engage the former governor to assume control until the end of September.
Whereas new parliamentary entrants like Dr Agambila and Isaac Amoo have been staunch defending the decision, other MP are not keen on joining the imbroglio and are adopting a wait and see action.
The Deputy Government Spokesman, Mr Kwabena Agyepong was on air to explain the situation and had subsequently summoned the leadership of Parliament and officials of the Ministry of Finance to a meeting at the castle on Wednesday afternoon.
According to Kwabena Agyepong, given the fact that the payment of the loans would eventually have to be made from the Consolidated Fund, it would have been more prudent for the proposal to have been submitted by Cabinet and not the other way round. Presently, it has not been discussed by Cabinet for a decision to be taken.
Mr Agyepong hinted that by the close of Wednesday, the President would have to confirm decision on the issue and makde public his decision oon it.
Commenting on the issue, Mr Osei Kyei Mensah Bonsu, MP for Old Tafo Suame, explained that the amount ranged between 12,000 and 20,000 dollars and that some members of the House were confident that they could pay the loan and even use their end of service benefit to offset it. It is however optional.
But Mr Kwesi Pratt Jnr, Editor of the Weekly Insight, will have none of it saying that the salaries MPs receive cannot place them in a position to be able to service the loans. "If about 1.4 million cedis is deducted from their salaries it means a member would be left with just a little over 100,000 cedis. So how do they hope to service on that?" he questioned.
For his part, Mr Doe Adjaho, Minority Chief Whip in Parliament, expressed surprise about the attitude of some members of government who are now pretending as though they have not been in the know of the whole deal.
It was also alleged that the acquisition of a 60,000 dollar Mercedes Benz by the Speaker, set a bad tone for the rest of the House to follow. - Evening News
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Accra (Greater Accra) 11 October 2001 - President John Agyekum Kufuor and his Cabinet say they do not approve of the 20,000 dollar car loans for each Member of Parliament (MPs).
"With reference to the current furore in the media about car loans for MPs, the government wishes to state that the President and the Cabinet have not taken such decision", a statement from the office of the Government Spokesperson, Ms. Elizabeth Ohene said.
The President held talks with the Speaker of Parliament on Wednesday after a public outcry against reports that each member of the legislature was to receive a 20,000-dollar loan from the consolidated fund for the purchase of vehicles
The Government said within the context of the country's economic situation, it cannot afford the interest-free four million dollar loan to members of the legislature but will help source loans for them to purchase their own vehicles.
It was agreed at the meeting that the Parliamentary Leadership prioritise the transportation needs of MPs whilst the government works with Parliament to find appropriate means to resolve the urgent ones.
"Whilst acknowledging the serious shortage of vehicles in the public sector, it should be stated that the President has identified as his first priority, the procurement of vehicles for the Police to enable them to discharge their duties."
It said government has in the past few months been working on finding the most cost effective solution to procuring the vehicles for the Police, adding that "It is his (the President) firm belief that when the Police are equipped with the vehicles they require to perform their duties, everybody's security would be better ensured".
Meanwhile, to Members of Parliament (MPs) from both the Majority and Minority sides have defended the 20,000 dollars car loans for MPs saying it was reasonable and justified.
As one of the three arms of government and in view of the huge constituency obligations of MPs, they deserve a reliable means of transport just like those of the Executive and the Judiciary, they said.
The New Patriotic Party’s Kyei-Mensah-Bonsu, the Majority Chief Whip and Mr Moses Asaga, National Democratic Congress (NDC) MP for Nabdam, were speaking in separate telephone interviews on "Sky FM" a radio station in Sunyani on Wednesday.
Mr Kyei-Mensah-Bonsu said it was unfair for the public to criticise MPs when they did not raise a finger "when similar offers are regularly extended to doctors and judges.
"The other two arms of government, the Executive and the Judiciary even enjoy free use of cars without the burden of paying for fuel and maintenance cost but we are going to pay back every penny of the loans so why the outcry?"
Mr Kyei-Mensah-Bonsu said Parliament requested for a higher amount but had to settle on 20,000 dollars because of the economic difficulties facing the country. "We are not being insensitive. Parliament is a very important national institution for the entrenchment of democracy and rule of law and granting members 20,000 dollars loans to enhance their work should not be deemed too much".
The Majority Chief Whip appealed to the public to stop politicising the issue and said that although the cars were to be supplied next year, deductions of 1.2 million cedis were already being made from the salaries of MPs.
Mr Asaga said the loan is genuine since MPs need reliable means of transport to visit their constituencies regularly and to move around in Accra to source for projects. "About 70 per cent of our constituencies are rural and we need good cars if we are to visit them regularly."
Mr Asaga said he uses an NDC vehicle or hitchhike before he could visit his constituency because as a Minister in the previous government he was denied the car loan granted MPs in 1996. "This time around, I think all ministers, who are MPs must be allowed to access the loans so that when they are no longer ministers, they will still have a means of reliable transport to tour their constituencies."
Mr Asaga said he had visited a lot of African Parliaments and his conclusions were that "Ghana's is the most deprived and MPs the least in terms of both resources and looked after".
He urged the media to help Parliament to be viable since it plays a very important role in the consolidation of democracy, which guarantees press freedom.
During the phone in segment, the majority of callers expressed concern about the granting of such "huge car loans" to the MPs in the face of the nation's Highly Indebted Poor Countries (HIPC) status.
In another development, organised labour has stated that
although Members of Parliament (MPs) deserve vehicles to enhance their work,
any loans that will be granted them should reflect conditions in the public
service. It is of the view that just as the work of MPs are crucial in
promoting democracy, other public sectors also contribute to the running of
government.
It however stressed the need for MPs to be modest in their
demands, since they are also expected to serve as role models in the society.
Labour has expressed the need for everyone to recognise that
team work is required to facilitate the function of the state machinery and
therefore, suggesting that no group from the public sector should be seen to be
"special".
It also called for a national debate on the issue of
providing accommodation and vehicles to MPs, ministers of state and other
public office holders to serve as a blueprint for implementation.
The Civil Servants Association (CSA), the Ghana National
Association of Teachers (GNAT) and the Ghana Federation of Labour (GFL)
expressed these sentiments in separate interviews with the "Graphic"
in reaction to the granting of $ 20,000 loan to each MP for the purchase of
vehicles.
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The Daily Graphic after a search through its archives,
carries that Members of Parliament (MPs) in both the First and Second
Parliaments of the Fourth Republic were given loans to purchase vehicles. In 1993,
a total of 890 million cedis was disbursed to 178 MPs to acquire their own
vehicles.
The paper on September 22, 1993, carried that the MPs were
being given the cars to enable them to commute between their homes and
Parliament and also to meet schedules within their various constituencies.
It says it has gathered from a reliable source at the office
of Parliament, that the remaining 22 MPs did not apply for the credit facility
put at 5 million cedis for each MP and reportedly arranged through then Ghana
Commercial Bank (GCB), which serviced 98 MPs, and the Social Security Bank,
which catered for the remaining 80.
A letter from Parliament to the banks stated in part that
the purpose of the loans was for "procuring motor vehicles for daily
schedules within and outside their constituencies".
According to the source, the MPs were made to open an
account with the two respective banks as part of the conditions for granting
the loans. Although it could not spell out the full details of the transaction,
the paper’s investigations indicated that it was mooted from the office of the
then Majority Leader and Minister of Parliamentary Affairs, Mr J. H.
Owusu-Acheampong.
The source could also not tell whether the loans were
guaranteed on behalf of the MPs by the government, and also refused to comment
on the mode of payment, but said it was established that the loan would spread
over a period of four years.
Attempts by the "Graphic" to find out at the GCB
the exact percentage chargeable on the loans, as well as details of the terms
of repayment, were foiled as officials were tight-lipped. However, unofficial
sources at the bank revealed that the loans were of a concessionary nature and
would therefore attract very low interest rates.
At the SSB where officials were very cooperative, the
"Graphic" was told that interests chargeable on the loans had been
fixed at 29.5 per cent, which was the normal commercial rate. All the loans
were insured, the officials said. Meanwhile, most of the MPs had procured their
own vehicles.
For the Second Parliament, MPs were given the go-ahead to
take loans of 26 million cedis each (about $15,000 at that time) to buy
vehicles. The report carried by the May 13, 1997 issue of the
"Graphic" said that members who had duty post cars were exempted from
the exercise.
Mr Owusu-Acheampong in an interview had said that members
would pay the normal interest, just as beneficiaries in the Civil Service.
Indications were that if the members were unable to pay for the cars before
their four-year term ended, they would have to repay with their end of service
benefits.
Samples of Peugeot 406, VW Vento and KIA cars were put on
display at the precincts of the House to enable members to pick and choose what
they wanted. Indeed, Peugeot, which was selling its cars at 28 million cedis,
wrote to say that since Parliament was requesting 26 million cedis, it had
agreed to further reduce the landed cost of the cars to that level.
Investigations conducted by the "Graphic" on
Wednesday (10th October, 2001) revealed that almost all the MPs who benefited
from the loans for the cars in 1996 are yet to finish paying off the said
loans.
It would be recalled that under the regime of the late Dr Hilla Liman in 1979, the government purchased Peugeot saloon cars for all MPs at a cost of a little over 4,000 cedis (about $1,455 at that time). The cars were however retrieved from the MPs after the overthrow of the regime. – Daily Graphic
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The
People's National Convention (PNC) has expressed concern about the government's
decision to advance car loans of $20,000 to each Member of Parliament reports
The Ghanaian Times.
In a
statement issued on Wednesday and signed by its Publicity Committee Chairman,
Mr Bin Kotten-Nibi, the party noted that "we find it difficult to believe
that the government can commit such a huge amount for car loans under our HIPC
conditions, when the minimum wage is less than a dollar and majority of people
cannot afford three square meals a day."
The
statement said the PNC rejects totally, government's explanation that the
decision emanated from Parliament. "The party also rejected as frivolous,
the explanation that the monies given out to the MP's is not free but loans be
re-paid."
The
statement said "the PNC's position is that the decision lacks moderation
and is without due consideration of the difficult economic condition in the
country."
It advised
MP's that under the present situation, people expect their MP's to identify
themselves with their plight and be modest.
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Accra (Greater Accra) 10 October 2001 - The announcement that each
Members of Parliament (MP) will be granted $20,000 loan to buy a vehicle has
generated controversy in the country. While some MPs have defended the
advancement of the loans, members of the public think otherwise.
President
Kufuor is reported to be outraged by the decision. In a rare show of
solidarity, members of both the Majority and Minority in Parliament have
vigorously justified the need for them to access the loans arguing that the
cars will facilitate their work in Parliament and their numerous travels to
their constituencies. Their explanation has however not deterred the public
from criticising the decision following the revelation that the money will be
sourced from the Consolidated Fund.
The
General Secretary of the Convention People’s Party, Nii Noi Dowuona told JOYFM
that the Speaker of Parliament’s purchase of a $60,000 Mercedes Benz car was a
bad precedent for members. He urged the President and the leadership of the
House to thoroughly discuss the issue. The NPP MP for Ayawaso who believes that
the lawmakers have a legitimate claim to the loan has accused the media of
inciting public sentiments against Parliament.
The
Editor of Weekly Insight, Kwesi Pratt Junior says the taxpayers and the
government risk being ripped of massive amounts of money if the $20,000 loans
for the MP’s to purchase vehicles were approved.
According
to him, the salaries paid Parliamentarians do not place them in a position to
pay back the loans they are taking. Mr Pratt explained that the MPs are paid a monthly
salary of 1.3 million Cedis and if 1.2 million Cedis is taken out of their
salaries a month as payment for the car loans, the MPs will be left with only
100,000 Cedis.
“Everybody
in Ghana knows that 100,000 Cedis cannot sustain even the body and soul, so
where are the MPs going to get monies to cater for themselves. Are they going
to cut corners and engage in deals?” Mr Pratt said although the MP’s need cars
to facilitate their work, their actions show that they are more interested in
buying luxurious cars. – Joy FM
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Accra (Greater Accra) 10 October 2001- Information available to
JOYFM indicate that President J.A. Kufuor was not informed about the decision
to grant the $20,000 loans to Parliamentarians to purchase vehicles. The move
by Parliament is said to have upset the President who has summoned the leadership
of Parliament for an emergency meeting over the matter.
Government
Deputy Spokspeson, Kwabena Agyepong restated the President’s concern that the
government is not in a position to spend that much money on vehicles for MPs.
According to him, although many Parliamentarians have no intention of accessing
the loan, the President is displeased that he did not take a final decision on
the matter before it was put in the public domain.
Meanwhile,
the Minority Chief Whip in Parliament, Edward Doe Adjaho has expressed surprise
at the Executive’s pronouncements that it had no knowledge about the decision
of Parliament, for members to access the loans from the Consolidated Funds for
their vehicles. He was reacting to the deputy Government Spokesperson’s statement
that the President was upset and had summoned Parliament’s Leadership to a
meeting over the matter.
Mr
Adjaho said “we discussed this issue with the Majority Leader in Parliament,
J.H. Mensah. The Minister of Finance signed the letters to seal the deal, so if
the Executive is saying that it has no knowledge on the proposals for the
loans, than as an MP, I don’t know when to take a Minister of State seriously.”
Joy FM
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Accra
(Greater Accra) 10 October 2001 - Mr. Kwabena Agyepong, Deputy Government
Spokesman, has explained that the decision to grant Members of Parliament (MPs)
$20,000 to enable them to purchase cars to facilitate their work was not the
decision of the executive but rather that of Parliament.
He pointed out that the whole project from conception to the final decision emanated from Parliament and enjoyed that support of both sides of the House and that the Executive only had the task of finding the means to implement it.
The Government Spokesman was throwing light in an interview on the Graphic report of yesterday which disclosed that each MP was to be given $20,000 loan to buy a car.
According to Mr. Agyepong, the impression created that the government, without due consideration of the difficult economic conditions in the country, just "doled out money for MPs to buy new cars are both incorrect and unfortunate."
He also made it clear that whatever was given out to the MPs was not free money but loans which would be repaid by those who benefited from them. "These are not just blanket loans for the MPs; they are for those who are both willing and ready to take and repay them and to use such facilities to serve the larger national interest," he said.
Mr. Agyepong pointed out that without prejudice to similar arrangements made for MPs in the past, the situation the government has had to contend with was that the current Parliament was new and distinct from the previous ones.
He said as a measure of determination of the government to recoup all such monies, deductions had already been effected from the September salaries of MPs in fulfilment of the conditions attached to the loans. He, however, could not put a definite figure on the amounts deducted or say for how long such deductions would be made.
Mr Agyepong pointed out that in terms of stature, MPs were on the same level with High Court Judges, who were recently given cars by the government as part of their conditions of service and also to facilitate the effective performance of their duties.
"This and other factors have served to strengthen the case for securing similar facilities for the MPs and also put the executive in a situation that makes it difficult to ignore the entitlements of the MPs", he said.
Mr Agyepong pointed out that the government taking due cognisance of the financial constraints of the country on one hand, and the need to meet the legitimate demands of the MPs on the other, put in an invitation for tenders for vehicles after the current arrangement was agreed upon.
"Given the current prices of new vehicles on the market, this arrangement offered the cheapest and best way out in the circumstances and it was, therefore decided to take this facility", he stressed. - Daily Graphic
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