Contractors in Ghana have voiced concerns about the delays in government construction projects, attributing the issue to the International Monetary Fund (IMF) programme.
President of the Ghana Chamber of Construction and Industry, Emmanuel Cherry, noted that the IMF’s directive to put all donor-funded projects on hold has caused projects like the Tema roundabout, Teshie Nungua, Abossey Okai flyover, Takoradi, and Kumasi interchanges to come to a halt.
Cherry emphasized the negative impact on the contractors, who often borrow from banks to finance projects with the expectation of timely payments from the government. The delay in payments has resulted in high interest costs to the nation, with funds that could have been used for other projects being diverted to only one project without any progress.
The Deputy Chief Executive Officer of the Public Procurement Authority, Kwame Prempeh, also raised concerns about the increasing rate of unbudgeted projects being executed by contractors. He highlighted that executing projects without the government’s provision in the budget leads to arrears building up, contributing to the rising cost of construction projects financed by the State.
However, the 2024 Budget has allocated GH¢11.6 billion to settle outstanding dues owed to contractors, aiming to encourage their return to project sites and resume work on unfinished projects. This move seeks to address the challenges faced by contractors and mitigate the delays in completing vital construction projects across the country.
The integration of the Ghana Integrated Financial Management Information System (GIFMIS) with GHANEPS is expected to play a crucial role in reducing arrears in the system by ensuring that the approval to start a project or the availability of the budget is verified before project execution.
It is evident that the issues surrounding delayed payments and unbudgeted projects have significant ramifications for the construction industry in Ghana. The allocation in the 2024 Budget is a step toward addressing these challenges and providing necessary support to contractors for the successful completion of infrastructure projects.
