SGAGL Denies Claims Of Inflated Costs In Ambulance Deal | General News

The Service Ghana Auto Group Limited (SGAGL) has refuted allegations of inflated costs in its contract for the after-sales service and maintenance of 307 ambulances.

In a statement released on Thursday, August 1, 2024, SGAGL responded to claims by the Member of Parliament for North Tongu, Samuel Okudzeto Ablakwa, who alleged financial improprieties surrounding the procurement and maintenance of the ambulances. SGAGL stated that the allegations raised by the MP are baseless.

“SGAGL is an SPV of a consortium of seven companies that participated in a competitive procurement process, not sole-sourced, and was adjudged on merit to procure and provide after-sales service and maintenance for 307 Mercedes Benz Sprinter ambulances for the National Ambulance Service (NAS),” the statement read.

The controversy began when Mr. Ablakwa, who is also the Chairman of the Economic Committee in Parliament, accused the government and SGAGL of engaging in a “rip-off” deal. Mr. Ablakwa claimed that former Finance Minister Ken Ofori-Atta had hastily approved payment of US$34.9 million for the procurement of spare parts for the ambulances, asserting that this amount, approximately US$113,000 per ambulance, was significantly higher than the cost of acquiring new ambulances. He further alleged that US$10 million had already been disbursed to SGAGL.

However, the Bank of Ghana (BoG) later clarified that no payment had been made on the letter of credit established for US$10 million, as the necessary demand for payment had not been made. SGAGL also addressed this point in their press release, stating, “the $34.9M, of which Letters of Credit (LC) were established for $10M, is falsely assigned to cover only mechanical parts, and the figure was again deceitfully allotted at about $113,000 worth of spare parts per ambulance.”

SGAGL stated that the initial competitive procurement process was initiated by the Ministry of Special Development Initiatives in November 2018. The process invited tenders for 275 units of 4×4 ambulances, later varied to 4×2 for 307 vehicles. “A total of 16 companies participated, including the seven companies that eventually formed the Consortium during the pre-tender workshop round,” the statement detailed. The companies that formed the consortium included Luxury World Auto Group Limited, Elok Consult, RDC Company Limited, Beft Engineering Works Limited, Prestige Era Company Limited, Bluemix Company Limited, and Quality Supply and Builders Company Limited.

The press release also emphasized the consortium’s compliance with all tender requirements, including obtaining the manufacturer’s authorization from Mercedes Benz for the ambulances and EMSA AMBULANCES for the medical equipment installed in the vehicles. SGAGL further stated that they had established a dedicated workshop and support infrastructure, including the renovation of the Ministry of Agriculture’s workshop in Kumasi and a purpose-built workshop at the NAS headquarters in Accra.

Additionally, SGAGL addressed the findings of a 2022 Performance Audit by the Auditor-General, which had reportedly highlighted issues such as inflated invoices and mismanagement. The company acknowledged having significant disagreements with the audit report and stated that they had refunded amounts erroneously labelled as double payments.

SGAGL warned against the dissemination of false information regarding the procurement of the ambulances and its after-sales service, threatening to seek legal action against those who spread such misinformation.

“The Consortium and SGAGL have and will continue to act above board in their dealings,” the statement concluded, adding that they will hold accountable those responsible for spreading false allegations.