Contractor terminates 5000 Saglemi housing project, asks for compensation

The contractor working on 5,000 government’s affordable housing project, Constratora OAS Ghana Limited, has written to terminate the contract with government.

The decision to terminate the $200 million contract, was communicated to government on February 18, the company has said.

The contractor has, in another letter dated March 8, and signed by Directors of the company, Charles Maia Galvao and Ricardo Rocha Ulm da Silva, demanded compensation from the government.

“…Further, the termination and following the provisions of the Agreement, the Contractor hereby presents Variation to cover additional costs suffered by Contractor due to Delays and Disruptions which impacted the project and are attributable to the Employer,” stated the letter addressed to the Chief Director of the Works and Housing Ministry.

The letter listed some of actions on the part of the government contributing to disruptions as “(i) tax exemption not fully conceded as per the conditions of the contract; (ii) tax exemption conceded beyond the time frame specified on the contract; (iii) Costs due the reduction of space of works and moreover, the suspension of works.”

State shortchanged

On Wednesday, sector Minister, Samuel Atta-Akyea gave hints of government’s intention to terminate the Saglemi housing project.

According to him, the state was short-changed in the $200 million deal which was entered into by the John Mahama government.

The case, he indicated, had been referred to the Attorney-General for advice.

“We realised that dubious shortchange in terms of the contract sum and the delivery of the housing units and we believe that there are challenges of value for money analysis,” he told Accra-based Citi FM.

The contractor was expected to have, by 2016, completed the first phase of the project, with 1,500 housing units.

However, on a recent visit by the Works and Housing Committee of Parliament, it was revealed that only a little over 600 housing units have been completed and have been left unused for more than a year now.

“You noticed that the houses have started developing some form of cracks because no one lives there” two years after completion, Minority Spokesperson on the Committee, Emmanuel Bedzrah lamented on PM Express on Joy News on Wednesday.

Gov’t won’t be bullied

Deputy Chair of the Committee, Kwaku Asante Boateng, in an interview with Joy News said they will investigate the issues raised by the contractor and advise the Ministry accordingly.

About the Saglemi Affordable Housing project

The project which is located at Prampram in the Greater Accra Region was intended to reduce the country’s massive housing deficit.

It is seated on a 300-acre land with one to three bedroom apartments for low-income earners and includes the realisation of around 5,000 residential units.

It has 3-floor buildings with 6 to 9 apartments with living space ranging from 40 m² to 85 m².