Construction sector suffers from fallout of suspension of contracts payment Featured

Oct 09, 2017

The decline of growth in the construction sector is attributable to the fallout of the government suspending payment for works that has already been done, a captain of industry has said.
The Chairman of the Association of Ghanaian Industries (AGI) construction sector, Mr Rockson Dogbegah observed that “the suspension in the payment has been due to the government efforts to ensure that contracts that were awarded are audited to pay for work actually done.”
In the second quarter, this year, the construction sub-sector recorded the least growth rate of 0.2 percent compared to 0.8 percent in the first quarter.
However, in 2016 ,the first quarter recorded 4.1 percent and the second quarter, 2.2 percent.
Dogbegah noted that this has been a challenge to the government.
However, he was optimistic that, as the government settles down in its operations, the sector will see some increase in the level growth.
According to the 2017 budget, total expenditures at end December 2016 stood at 30.3 percent of GDP against a target of 26.4 percent of GDP, with an outstanding stock of arrears of nearly GHS7 billion.

As a result of the stock of arrears, earlier this year, the Ministry of Finance indicated it was going to audit all arrears that have accrued over the period, in order to make payment to those that have legitimate claims of arrears.
In the 2017 budget, the Ministry indicated only 20 percent of arrears will be paid.
As part of efforts in the advocacy by the AGI, the construction sector of the Association formed a forum known as the Ghana Construction Industry Development Forum(GCIDF) as an initiative towards the private sector reform process, which provides a participatory, inclusive and structured approach to policy-making directed at reforming governance and the business climate.
Another area of attention that Association intends to place focus on is the proliferation glass panels in the construction industry
Dogbegah on this issues noted that there is the need to build capacity.
Therefore, the Association is planning to have a workshop to educate professionals and stakeholders as well as consumers of glass services in the industry.

By Joshua W. Amlanu