President Nana Addo Dankwa Akufo-Addo has instructed the Ministry of Finance and the Ghana Revenue Authority (GRA) to enter into renegotiations with Strategic Mobilisation Limited (SML) regarding their revenue assurance contract.
The President stressed the importance of closely monitoring and evaluating the renegotiation process to ensure it meets the desired outcomes.
This decision comes after President Akufo-Addo accepted the recommendation from KPMG following their audit of the contract.
The audit revealed areas where improvements are needed to enhance the effectiveness of the contract, prompting the need for renegotiation.
According to KPMG’s findings, there is a clear need for the downstream petroleum audit services provided by SML. The services have benefited both the GRA and the state, resulting in increased volumes of 1.7 billion litres and a tax revenue increase of GHS 2.45 billion. KPMG also noted qualitative benefits, such as 24/7 electronic real-time monitoring of outflows and partial monitoring of inflows of petroleum products at depots where SML has installed flowmeters, leading to a reduction in under-declarations.
However, it is essential to review certain aspects of the contract, particularly the fee structure. Given SML’s experience and proficiency over the last four years of providing these services, the President has directed that the fee structure be changed from variable to fixed. Other provisions of the contract, such as clauses on intellectual property rights, termination, and service delivery expectations, will also be reviewed.
President Nana Akufo-Addo commissioned KPMG to investigate the SML-GRA contract on January 2, following an exposé by the Fourth Estate. He has since received the audit report and is taking necessary actions based on its findings.
