Gov’t at risk of GH¢200 million judgment debt over UG failure to pay contracted loan

Tracking government expenditure

The government of Ghana is at risk of payment of over GH¢200 million judgment debt as a result of failure of the University of Ghana Enterprise Limited to pay a loan contracted in 2008.

The University of Ghana Enterprise Limited (UGEL), which is a wholly owned company of the University of Ghana responsible for hospitality activities contracted a loan of GH¢43,000,000 from a consortium of six banks with the University of Ghana as a guarantor of the loan in February 2008 but has since failed to repay the loan.

iWatch Africa review of the Auditor General’s report published in 2017 revealed that the lenders have instituted a suit against the University to recover the amount owed by UGEL. The outstanding balance on the loan as at 31st December 2015 was GH¢211,718,663. The case has not yet been determined according to the report.

Our checks also indicated that UGEL financial statements as a company registered under the Ghana Companies Act, 1963 (Act 179), has never been audited to establish its state of affairs and to assess its ability to generate sufficient revenues.

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The Auditor General has indicated that the University of Ghana and for that matter the Government of Ghana risks being liable for the repayment of loans guaranteed, and this could have a material impact on the cash flow of the University of Ghana.

Report by Gideon Sarpong |  iWatch Africa

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Gideon Sarpong

2017 Thomson Reuters Foundation Fellow: Gideon Sarpong (G. K. Sarpong) is a media practitioner with over six years of experience in content development and management, data and investigative journalism, policy analysis, production and e-commerce strategizing. Gideon is currently Director of Policy and Content Analysis at iWatch Africa. He is also the Brands and Communication Manager for Football 360, Kwese SportsXtra, on KFS and Celebrity Fanzone, The Tonight Show, and After Hours. Gideon is an e-commerce consultant for Department of Geography & Regional Planning and Department of Religion & Human Values at the University of Cape Coast. He is also a farmer and columnist for several local and international news portals. Gideon holds a Post Graduate Diploma in Policy Journalism and Illicit Financial Flows and is committed to promoting transparency and accountability using investigative & data journalism. Gideon is an author with over eight publications and a fellow of the Young African Leadership Initiative (YALI), Thomson Reuters Foundation (Wealth of Nations Program) and Bloomberg Philantropies (Data for Health).

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