The Auditor General has made a damning revelation against the Ministry of Health (MoH) and Ministry of Food and Agriculture (MoFA) over the manner in which they sold off government vehicles, in violation of a law regulating the disposal of such assets.
In a 33-page performance auditing report covering the period of 2011-2013, the Auditor General revealed how government vehicles were sold under questionable circumstances. It, among other things, exposed collusion between auctioneers and staff of the respective ministries, failure to account for the proceeds in some circumstances or pay the proceeds into government coffers.
The disposal of unserviceable or obsolete goods and equipment belonging to government is expected to be carried out in accordance with the procedures laid down in Part VIII sections 83 and 84 of the Public Procurement Act, 2003 Act 663 and the second paragraph of section 4.1 of the Guidelines for Disposal of Goods and Equipment. Section 15(1) of the Financial Administration regulation 2004 (L.I 1802) also spells out how proceeds realised from the disposal of assets is to be treated.
However, the report said the GHS did not constitute a Board of Survey (BOS) but formed a technical assessment team that assessed the vehicles earmarked as unserviceable before the State Transport Company (STC) assessed and valued the vehicles.
MoFA, on the other hand, constituted the BOS that reported on vehicles earmarked for disposal before the technical assessment and valuation was carried out by the STC.
The report further said there was non-transparency in the auction process by the auctioneers. The auctioneers did not undertake competitive auction to achieve value for the vehicles auctioned. The review on the disposal files at MoFA in the selected regions indicated that one auctioneer carried out 23 of the 24 auctions. All the vehicles were sold to staff of MoFA. There was loss of money to the state as the auctioneer was paid his commission without carrying out the auction.
The audit team’s review of the disposal files showed that the GHS put up nine auctions carried out by nine auctioneers. The transport manager at the head office of GHS, in a discussion with the audit team, stated that the respective auctioneers advertised all the nine auctions carried out, however the audit team said review of disposal files showed no evidence of publication of the nine auctions carried out by the GHS for the period 2011-2013. They also discovered that the GHS sold all vehicles above their reserved prices.
“Generally, auctioneers engaged by MoFA and the GHS did not ensure the auctioning process allowed for the general participation of the public to get competitive prices for the unserviceable vehicles,” the report stated.
MoFA, according to the report, did not pay auction proceeds of GHS491,553 into the Non Tax Revenue Account (NTRA) at the Bank of Ghana within the required time frame.
The GHS, on the other hand, did not account for GHS116,400.96 realised as auction proceeds to the Ministry of Finance and Economic Planning. The GHS head office engaged four auctioneers who carried out one auction each in 2012. The audit team found receipts on the disposal file that GHS issued to two auctioneers to confirm that they had paid and accounted for auction proceeds realised. The two auctioneers paid GHS45,650.00 and GHS30,210.00 respectively as auction proceeds to the GHS head office accountant. But as of 16 June 2014, the GHS head office had not paid the proceeds received from the two auctioneers for the 2012 auctions into NTRA.
When the GHS’s attention was drawn to the situation, they paid an amount of GHS22,984.95 into the NTRA on June 24, 2014 out of the GHS85,360.00 received from auctioneers leaving a balance of GHS62,375.05. Out of this balance, GHS head office paid GHS27,914.09 into the NTRA on 26 March 2015, leaving an amount of GHS51,305.96 to be accounted for by the GHS head office.
The third auctioneer did not pay the proceeds to the head office but instead paid the full amount of GHS30,764.40 directly into the NTRA. The fourth auctioneer [Shelter Mart] did not pay and account for the GHS44,125.00 which he realised from the auction he carried out until the service wrote to him on June 12, 2013 to remind him of the unpaid auction proceeds before he paid GHS5,000.00 on June 14, 2013 and GHS2,000 on July 4, 2013 respectively.
Shelter Mart, after a series of letters to it threatening legal action for the non-payment of the balance, paid another GHS2,500.00 to the GHS head office on April 29, 2014 leaving a balance of GHS34,625.00 as unpaid auction proceeds.
Reviews of disposal files in the Volta Region showed GHS had two auctions carried out by auctioneers in 2013 and realised an amount of GHS24,715,00. Out of this, one auctioneer paid GHS7,870.00 to the Ho regional office and the other auctioneer paid GHS16,845.00 to the Tema office (central mechanical workshop) of GHS. In discussion with the Ho regional accountant of the GHS, he stated that the regional office had not paid the proceeds into the NTRA because it had the intention of using the proceeds to maintain its regional mechanical workshop and vehicles, which contravenes section 22(1) of the FAR 2004 which states that: “All public monies collected shall be paid in gross into the Public Funds account and no disbursement shall be made from the money collected except as provided by an enactment.”
A similar situation occurred in the Northern Region where three auctioneers carried out three auctions from 2011-2013. The proceeds realised amounted to GHS57,225.00 which the auctioneers paid to the Tamale regional office of the GHS. As at the time the audit team visited in August 2014, the office had not paid the amount into the NTRA but rather lodged it in the regional office’s account. The regional officers were of the opinion that the regional office should use the proceeds for the maintenance and running of its vehicles since allocations from government were not forthcoming. This, according to the regional head, was the main reason why the office had not paid the auction proceeds into the NTRA.
Source: Ghana/AccraFM.com
