Considerable amounts of money approved by the World Bank for various projects in the country, are said to be still sitting idle in the ministries, departments and agencies (MDAs).
This is due to the slow process of disbursement attributed to the general weaknesses in the country’s implementation.
Speaking to the ‘Times’ the Bank’s Country Director, Ishac Diwan, confirmed the situation but said that “over the past few weeks, things appear to be improving.”
The interview followed an article by IMANI Centre for Policy Analysis and Education, titled: “Ghana sits on borrowed time” in which the centre said that some funds approved for various projects are not utilized.
The report stated that the disbursement rate of project loans had dropped from just under 30 per cent to 12 per cent, and now hovered below five per cent.
This means that very few of World Bank-funded projects in Ghana presently are on track, judging from the disbursement rate.
IMANI also raised concerns about the huge amounts of money paid to consultants which ranged from $5,000 a month for Ghanaian consultants to $12,000 for expatriates on Project Implementation Units.
Mr Diwan said disbursement ratio was as at last month was 15 per cent when budget support was not counted and 29 per cent when it was counted.
“The bank does not charge interest of fees on undisbursed balances. Actually, we only charge 0.7 service charge on funds disbursed and at zero interest rate.”
Mr Diwan said “because Ghana only borrows from the International Development Association (IDA), the concessionary lending institution of the World Bank Group, the bank does not charge interest on its lending to Ghana.”
Commenting on monies paid to consultants, Mr Diwan said international consultants were hired on projects and programmes do “at least theoretically, only when necessary.”
The bank, he said had almost phased out Projects Implementation Units in Ghana and had been moving towards mainstreaming implementation of all its projects in the MDAs.
“For example, I know that the recent designs for urban water systems have been done by an Israeli firm working in association with a local engineering firm and in many cases it is stipulated that international experts work with local experts,” Mr Diwan said.
In his reaction to the IMANI article, Seth Tekper a Deputy Minister of Finance and Economic Planning said although some of the issues raised in the article were legitimate, the delay could not be laid at the doorstep of the government alone but the World Bank as well.
“The World Bank itself must admit that its procedures and processes are too tedious resulting in the delays in the implementation of projects,” he said.
The Deputy Minister said the Bank insists on international bidding for its projects which sometimes takes long to be completed.
“Even though we have our procurement laws, the World Bank still insists that we go on international competitive bidding for projects and even adverts which have been placed in the local papers have to be sent to World Bank’s office in Washington for approval before the bids are sometimes disqualified,” he said.
He said the Bank’s conditionalities and insistence on the implementation of project management teams contributes significantly to the delay.
“For example the government’s e-governance programme had to be delayed for one and half years because of the lengthy procedures,” he said and added: “I’m not absolving our MDAs but to place the blame solely on government is not right. The World Bank itself is also part of the problem.”