A little over a month, after The Chronicle blew the lid over the suspicious $500 million deal signed between the Ghana Revenue Authority (GRA) and an IT company, Subah Infosolutions, which has been described as ”Create, Loot and Share”, it has now emerged that the deal was not authorized by the appropriate government officials.

The controversial contract, which was executed, based on sole sourcing, is worth $100 million a year, for five years.

President John Dramani Mahama, who dropped the hint during an interaction with anti-corruption groups at the Flagstaff House last Friday and subsequently, ordered the review of the whole contract.

“I have instructed the Minister for Finance and Minister for Justice and Attorney General to review and advice on a suspension of the contract with Subah Infosolutions, seeing as the contract was not signed by the appropriate authorized Government representative”.

The President also directed that all sole sourcing contracts worth more than Ghc5 million should be referred to Cabinet for approval before any deal is signed to commit the government.

The President’s directive came on the heels of the official denial by GRA and Mr. Sam Pee Yalley, the former CEO of the Pension Regulatory Authority that there was nothing wrong with the deal.

Mr. Sam Pee Yalley had told Radio Gold listeners a couple of weeks ago that he had personally read the contract and that there was nothing wrong with it, to merit the attack on the GRA.

The ambassador designate’s strong defence of the contract also came at the time the Finance Minister had already issued a statement that the contract was being reviewed.

The Director General of the GRA, Mr. George Blankson, earlier held a news conference to strongly defend the contract.

According to him, even though he did not personally sign the contract, which is worth $100 million a year, he witnessed it. He also debunked The Chronicle publication that Ghc144 million had so far been doled out to Subah Infosolutions.

According to him, his checks with the accounts department had revealed that the GRA had so far paid Ghc75 million to Subah Infosolutions, which represented 13.5% incremental revenue they collected from the Telcos.

The Director General of the GRA did not, however, disclose the name of the person who signed the contract, but President Mahama, who has vowed to deal ruthlessly with all suspected corrupt cases involving government officials, openly coming out to state that no authorized government official signed the deal, it is not known how the whole idea was conceived and executed.

In the case of the Ghc75 million paid to Subah, an Economist, Dr. Nii Moi Thompson punched holes in the claim. In a letter he sent to The Chronicle in reaction to the whole GRA-Subah story, he stated: The 13.5% rate (and the associated Ghc75 million fees) implies that Subah would have brought in Ghc555 million (the so-called “incremental revenue”) more than the GRA collected to merit such a fee.

But data from the government’s budget statements from 2010 to 2013 show that the combined forecasted revenue from the CST for the period 2010-2012 was Ghc437,291,000 – with a provisional outcome of Ghc411,475,720. This was a shortfall of Ghc25,815,280 – or 5.9% of the forecast.

It is clearly impossible for Subah to have contributed Ghc555 million “more” to an amount that was smaller. In other words, the numbers don’t add up, literally and figuratively.

Dr. Nii Moi did not also understand why the contract was sole-sourced, which to him was a serious breach of the National Procurement Act, because it was neither a specialized service peculiar to Subah, nor was there an emergency to warrant the suspension of the rules of competitive bidding.

“In the latter case, the law requires a short-term contract for goods or services acquisition, followed by competitive bidding after the emergency. A third condition, that of a threat to national security, for which competitive bidding may cause undue delays, clearly did not apply. Effectively, therefore, there seemed to have been no justification for sole-sourcing Subah,” he argued.

As earlier reported, GRA contracted SUBAH INFOSOLUTIONS LIMITED, somewhere in 2010, to electronically monitor revenue generated by the Telecom Companies to enable them calculate and collect the right taxes from the companies.

The contract specifies that Subah should deploy equipment that connects to the physical nodes of the Telcos, to enable them track the traffic on their network, which was never done.

Subah was rather taking data that had been supplied by the same Telcos to National Communication Authority (NCA) and claimed to analyse, after which a fee ranging between Ghc2million and Ghc4million were paid to them on a monthly basis.

In an attempt to defend this clear breach of contract, GRA claimed that the Telcos refused to allow them access to their nodes, a claim which was rejected by the telcos. The latter insisted that until the story broke, they did not know any company called Subah Infosolutions.

Dr. Nii Moi Thompson, in his famous letter, raised concern as to whether it was justifiable for Subah to be contracted to do a job that is supposed to be the core mandate of the GRA.

“But there is also a fundamental question of whether in the face of limited and shrinking financial resources this was the best way to spend public money, even under competitive bidding: Contract a company to do what the GRA’s audit department is mandated to do and has been doing anyway.

Indeed, auditing is an integral part of any tax agency worth its salt, and the fact that government would pay a company millions of cedis to do what it already does gives the impression that the contract was contrived to siphon money from the government fiscus into private pockets. There is no other way to look at it, given the facts as they are.”