Minority in parliament assured Ghanaians on Thursday that they (Minority) would ensure Ghana gets value for money in the highly criticized STX housing deal which is to provide houses for the security services.
Mr Ambrose Dery, Deputy Minority Leader who said this at a press conference in parliament, said the Minister for Water Resources, Works and Housing, Mr Alban Bagbin, at a press conference on July 27, 2010 failed to explain the changes that had been made to the original document which was withdrawn from parliament.
Rather Mr Bagbin announced that government was returning the agreement to parliament “the good people of Ghana expected the Minister’s press conference to have explained how the concerns raised by the various stakeholders had been addressed.”
“Unfortunately that did not happen. All the Minister did was to re-state All; I repeat all the provisions and terms of the previously discredited and withdrawn agreement, plus insults at the New Patriotic Party and individuals. We shall not be drawn into politics of insults.”
The Deputy Minister of Finance, Mr Seth Tekper on Wednesday July 28, 2010 re-laid the STX housing deal before parliament which was referred to the joint committee of Works and Housing and Finance in parliament for consideration.
Mr Dery said the minority had stated time and again it supported in principle housing for the security services in particular and Ghanaians in general, adding that on July 27, parliament approved unanimously 50,000,000 dollars to be used to provide barracks accommodation for soldiers.
He said some outstanding keys issues of the project were still hanging including, STX was to borrow an initial amount of 1.5 billion to finance an initial 30,000 houses out of the 200,000 total and government would offer sovereign guarantee to cover STX Korea in acquisition of the loan meaning should STX default in the payment Ghanaians would pay back the debt.
Government is also to provide free land from the government’s land banks, unconditional import and income tax exemptions as well as Value Added Tax exemption on things STX would buy locally and full profit reparation for both the staff and the company, he said.
Again there were no designs and no cost of the houses to be built, insurance to cover political risk at 17.34 per cent that is 260 million adding, insurance cover for political risks at Multilateral Investment Guarantee Agency rates range from 0.45 per cent to 1.75 per cent.
There would also be full profit reparation for both the staff and the company with government providing infrastructure such as electricity, water, roads, and telephone lines to the houses at no cost to STX Korea.
Government would pay expenses such as legal fees, accounting costs, travel cost to the Korean Company in the execution of the project and any VAT on those expenses and full profit repatriation.
Mr Dery said the Ghana Real Estate Developers Association had presented a proposal to parliament in which under similar incentives, similar housing units could be built for less than 40 per cent of the price STX is charging.
“We trust our local builders, GREDA was building two bedroom houses with their own land, paying all taxes, building on site infrastructure, plus their profit margin, all for 25,000 dollars,” he said.
“We are contracting foreigners to build houses, most of which are one-bedroom houses despite the incentives for an average of 50,000 dollars,” Mr Dery said.
Mr Dery appealed to the government to pay attention to the GREDA proposal and other uncompleted housing projects instead of their religious attraction to Korea on the proposed terms.
Mr Dery added “we have already signed an off-taker agreement that compels government to buy these houses once completed.