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

Gideon Sarpong is a policy analyst and media practitioner with close to a decade of experience in policy, data and investigative journalism. Gideon is a co-founder of iWatch Africa. He is an author; a fellow of the Young African Leaders Initiative (YALI), Thomson Reuters Foundation, Commonwealth Youth Program ,Free Press Unlimited and Bloomberg Data for Health Initiative. Gideon is the founder of Sustainable Ocean Alliance Ghana. He was a 2021 Policy Leader Fellow at the European University Institute, School of Trans-national Governance in Florence, Italy and 2020/21 Open Internet For Democracy Leader. Gideon was also a 2022 Visiting Scholar/Reuters Fellow at the University of Oxford, UK and was selected as a 2022 TRF/Trust Conference Changemaker. He is currently the Africa Regional Cordinator for Environmental Justice Foundation and a 2023 Pulitzer ORN Fellow. Email: gideonsarpong@iwatchafrica.org.
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