Over the past couple of days, the suspension of the concession contract between Ghana and Power Distribution Services, and the reasons behind this move, have virtually monopolized news headlines in the country. This is rightly so – arguably the biggest and most strategically important deal entered into by the State has transformed into a public fiasco and the framework for the distribution of electricity to the southern half of Ghana is now hanging in limbo as a result. Households, private business enterprises and public institutions alike now find themselves in a state of uncertainty, with only the assurances of the very same state that apparently has bungled the most critical agreement it has entered into for decades, to hold onto with regards to the reliability of their access to power going forward.
Firstly and most importantly this newspaper however wishes to reaffirm those assurances; while government has failed miserably in its due diligence duties, it still has a firm handle on the supply of electricity through the returning Electricity Company of Ghana.
Unfortunately – but unsurprisingly – politics is distorting the unfortunate situation and the events leading up to it. Both the politicians themselves and their inflexible supporters are finding ways to blame everything on their political opponents and if care is not taken, what seems to be a clear-cut case of financial fraud will be subsumed by allegations of political malfeasance.
While this is unavoidable in Ghana’s sharply politically divided polity, it should not be allowed to create an escape route for whoever is found to be culpable of the hugely fraudulent acts behind this fiasco – or of the dereliction of duty that allowed it to pass without detection by the State for so long.
To be sure though, the allegations have not been proven yet and indeed, the concession given PDS has only been suspended, not outrightly revoked, this being a prudent precautionary measure. However, there are clear indications that sooner than later, PDS will not be in a position to hold the concession underpinning this entire sordid affair. Already the large and vocal lobby that opposed the concession right from the start has re-emerged into the open, leveraging the current debacle to argue for a permanent return to state-run electricity distribution.
But Ghana should be careful not to throw out the baby with the bath water. It is the manner in which the concession was handled that is at fault not the concept behind the concession. Besides, the concession is only part of the much wider Power Compact with the United States which remains crucial to the fortunes of Ghana’s power sector going forward.
Therefore, it would be prudent to ring fence the PDS fiasco thus confining the necessary changes to the areas where foul play is confirmed. This means replacing PDS – if indeed the ongoing investigation finds it guilty of wrong doing – with another concessionaire, but under the same terms that PDS was to operate under. The simple way to do this is to enter negotiations with the second placed investors under the original bidding although an alternative would be to go through a new bidding process.
What is most important though is that government should learn its lesson and this time perform its roles properly, including that of due diligence and verification of bidders and their guarantors.
The vehicle with which Ghana wishes to carry its power sector forward is broken, but that is no excuse for trying to reinvent the wheel.