President Akufo-Addo has directed the Ministry of Finance and the Ghana Revenue Authority (GRA) to renegotiate the revenue assurance agreement with Strategic Mobilization Limited (SML).
To make sure the renegotiation lives up to expectations, the President emphasized that it must be regularly reviewed and closely watched.
Eugene Arhin, the Director of Presidency Communications, issued a press release announcing this directive.
The president decided to renegotiate the contract after accepting KPMG’s recommendation following the firm’s audit.
A review of the revenue assurance contract was required in light of the audit findings, which pointed out areas that needed to be improved in order to increase the contract’s efficacy.
“There is a clear need for the downstream petroleum audit services provided by SML. GRA and the State have benefited from these services since SML commenced providing them. There has been an increase in volumes of 1.7 billion litres and an increase in tax revenue to the State of GHS 2.45 billion. KPMG also observed that there were qualitative benefits, including a 24/7 electronic real-time monitoring of outflow and partial monitoring of inflows of petroleum products at depots where SML had installed flowmeters and six levels of reconciliation done by SML.”
“This minimises the occurrence of under-declarations. However, it is important to review the contract for downstream petroleum audit services, particularly the fee structure. Given the experience and proficiency of SML over the last four years of providing this service, the President has directed that the fee structure be changed from a variable to a fixed fee structure. Other provisions of the contract worth reviewing include clauses on intellectual property rights, termination, and service delivery expectations.”
Following an exposé by the Fourth Estate, President Nana Akufo-Addo hired KPMG to look into the SML and GRA contracts on January 2 of this year.
Since then, President Akufo-Addo has obtained the KPMG audit report pertaining to the GRA and SML revenue mobilization contracts.
As stated in a Facebook post on Wednesday, April 3, Eugene Arhin, the Director of Communications at the Presidency, delivered the report to him on March 27.
