Over GHC11bn of inherited road debt already settled – Roads Minister
The Minister for Roads and Highways, Governs Kwame Agbodza, has stated that the government has already paid more than GHC11 billion out of the road sector debt it inherited from the past NPP administration.
According to him, this move is part of efforts to restore confidence in the industry, especially “to sustain the Big Push that is already ongoing.”
“As of last week, government has paid in excess of GHC11 billion out of the GHC40 billion we inherited, which is the biggest ever payment at a particular time to contractors in our history,” he disclosed.
The Minister noted that the payments are already helping to improve trust between the government, contractors and lenders, adding that some banks are now more willing to support road contractors because the government has shown signs that certified work will be paid.
“One of the difficulties in the industry prior to President Mahama coming into office was the lack of confidence, banks did not want to hear anything about road contractors because they were just those people who accessed monies from these banks to works on road contracts and never paid back, but you will be surprised to find out that today banks are chasing road contractors,” he said.
He further explained that some firms are now choosing to use bank loans to begin work, complete parts of the contract and then submit certificates for payment, rather than waiting for mobilization funds from the government before moving to site.
The minister assured that the government will continue to clear the debts, adding that about GHC1.9 billion will be available to the Roads Fund at the end of April to settle parts of these obligations.
“We will try to settle all these debts as soon as we can raise revenue and Parliament allocates our portion to us, but I am happy that the President, through the Finance Minister, has paid GHC11 billon, it is remarkable, and for instance, the road fund still has another GHC1.9 billion available to pay by the end of next month,” he added.
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