Parliament adopts report on aircraft lease agreement

Accra (Greater Accra), 17 February 2000

Mrs. Vida Amaadi Yeboah, NDC Akwapim South on Wednesday abstained from voting to endorse the purchase of the new presidential jet, during a head count.

Members of her party voted by 82 votes as against 38 by the Minority to accept the House Finance Committee's report on a financial agreement for the lease to Ghana of the Gulf Stream III executive aircraft.

The Minority Group had earlier challenged the outcome of the voting initially decided on a voice-count.

In the debate on Wednesday, Mr.Hackman Owusu-Agyemang, the Minority Spokesman on Foreign Affairs, opposed the motion for the adoption of the Committee's report, saying the government's desire to acquire the executive jet shows its insensitivity to Ghana's economic plight.

He said he wondered how the purchase of an aircraft should take precedence over the needs of the 'impoverished' rural communities.

He said he has never seen an agreement in which the owner is indemnified from all liabilities, adding, "we should for once, say this is one worse situation that we cannot accept".

Mr. Owusu-Agyemang, therefore, appealed to the authorities to go back and if possible, renegotiate the agreement.

Mr. Kosi Kedem, NDC-Hohoe South, said no one questions the usefulness of an executive jet but what is in issue is the propriety of the transaction.

He said the Minority had sought refuge in Article 181 of the Constitution to blame the Minister of Finance, for acting unconstitutionally, but the Minister acted under Article 181 (5) in good faith and transacted the agreement to the best of his understanding of this constitutional provision.

He said if there is any blame due to the ambiguity in Article 181 (5), it must be borne by Parliament, which should have provided the modalities under which such an international business or economic transactions should be dealt with as required by the Constitution.

Mr Kedem said that the bottom line of the matter is whether the acquisition of the aircraft is a priority. "I will say with confidence that if you ask any farmer, teacher or any unemployed, he would tell you that the first priority in this country is the safety of our President", he declared.

"As a nation, he is the symbol."

He said there is no doubt that the President and the Executive need a reliable aircraft and if the lease agreement would make it possible for them to have it, then "we must let them have it".

Mr. Doe Adjaho, the Majority Chief Whip, said the aircraft lease was financed from the contingency fund, which comes under the Appropriation Act of 1999 passed by the House.

He wondered whether the Minister had to seek any more parliamentary approval when the House had passed the Appropriation Act giving spending authorisation to the Minister.

Reacting, Nana Akufo Addo, the Minority Spokesman on Constitutional and Legal Affairs, said in a situation where an international financial transaction puts obligation on the Consolidated Fund, the Minister is required by the Constitution to seek prior parliamentary approval.

Continuing, Mr. Adjaho said there is a problem with the interpretation of Article 181 (5), and questioned whether the House is going to subject all international financial transactions to the refinements of Article 181.

He, therefore, supported the Committee's recommendation that Parliament should come out with modifications to be applied to such international transactions.

He said until when Parliament provides such modalities, the benefit of the doubt about Article 181 (5), should go in favour of the Minister.

Mr. Kwadwo Baah-Wiredu, NPP-Asante Akyem North, described the mode of payment of the deposit as an irregular way of acquiring an asset for the state, saying the transaction was in breach of the Constitution.

He referred to Article 179 (8) and questioned whether the Minister complied with this provision in the transaction.

The provision states in part that, "where, in respect of a financial year, monies appropriated by the Appropriation Act is insufficient; or that a need has arisen for expenditure for which no sum of monies has been appropriated by that Act; a supplementary estimate showing the sum of money required, shall be laid before Parliament for its approval".

On a point of explanation, Mr. John Mahama, Minister of Communications, said

in this circumstance, the aircraft is a lease item and not a purchase, where this provision would apply.

But Mr Baah-Wiredu said the transaction covered an expenditure item and suggested that those involved in the agreement should be surcharged.

Mr. Alban Bagbin, NDC-Nadowli North, said arguments so far advanced by the Minority "are muddled and confusing", noting that some of the contributions were politically motivated and mere emotional outbursts.

He said the lease agreement was lawful and constitutional, adding that many members had tried painfully to apply Article 181 to support their arguments.

He said the article deals with three scenarios in which clauses (1) and (2) offer a situation, where the government is granting a loan from public fund; while clauses (3) and (4) apply when the government is receiving a loan; in which case, Parliament is guided by provisions of the Loans Act.

He said the drafters of the Constitution realised that the government could not use clauses (1) (2) (3) and (4) for international financial transactions, so they are asking parliament to come out with guidelines to operationalise Article 181 (5).

The Speaker noted that there is a lot of difficulty with clause (5) of article 181, saying that it is a matter, which calls for discussions and debate by the House.

Asked what should be done if Article 181 (5) is not sufficiently amplified to handle international financial transactions, the Speaker said this could be addressed by an Act of Parliament.

Mr. J. H. Mensah, the Minority Leader, referred to the moral issue involved in the transaction and the outcome of voting on the adoption of the report on the lease agreement, saying it would indicate the moral standing of the House.

He said: "in our dire economic circumstances today, should we spend about 20 million dollars of the taxpayers' money to pay for an executive aircraft?"

"Millions of Ghanaians say we must not take such a decision and we, on this side of the House, are saying the same thing.

"There are many of us here, who think this is not the time to use 20 million dollars to buy an aircraft for the President but they dare not say so", the Minority Leader said.

Mr Mensah indicated that the vote on the motion would not end the matter because the Minority "considers it as a moral issue that should not be allowed to die".

The Minority Leader read to the House copies of a number of correspondence he had sent to the Hong Kong Shanghai Banking Corporation (HSBC), whose subsidiary, Gallen Limited is involved in the lease agreement and said investigations indicated that the addresses of Gallen did not exist.

"The government has signed an agreement with a company representing himself with an address, which does not exist".

Reacting to some of the issues raised, Mr. Kwame Peprah, Minister of Finance, told the House that the deposit paid by the government was committed to the lease of the aircraft with an option of a purchase.

He said HSBC wanted the transaction to be more efficient so it set up a special purpose company, Gallen Limited, to negotiate with the government on its behalf, adding that the purchase agreement did not involve any financial outlay.

Winding up the debate, Commodore Steve Obimpeh (rtd), Chairman of the Finance Committee, said all issues raised during the contributions were considered at the Committee level.

He said there is every justification to approve the lease agreement because Parliament had enacted the Appropriation Act under which the Minister was authorised to spend money from the Contingency Fund.

He said the Minister, therefore, acted within the law and "the agreement is properly before the House" and therefore called for its approval.

GRi