AGI CALLS FOR HOUSING & CONSTRUCTION BANK
The Construction Sector of the Association of Ghana Industries (AGI) has backed moves by the Minister of Works and housing, Samuel Atta-Akyea to bring back a specialised bank that will be dedicated to the financing of the housing and construction business.
Its sector chair; Mr. Rockson Dogbegah, said the measure was welcoming and the association would play its role to help make it a reality.
He was commenting on recent concerns by Mr. Ataa-Akyea who disclosed that the defunct Bank for Housing and Construction, if reinstated, would help tackle the housing deficit in the country.
The Minister said the bank would do that by creating opportunities for both public and private sector workers to obtain realistic mortgage arrangements with relatively lower interest rates as compared to the commercial banks.
This will help them provide some respite to Ghanaian workers to own houses long before they retire, the minister said.
While commending the minister for decision, Mr. Dogbegah said the return of the Banking for Housing and Construction would help to reduce some of the challenges of finance within the housing and construction sector in the country.
“One of the biggest challenges that indigenous construction companies face is getting banks to extend banking facilities to the construction sector, particularly to contractors working on government contacts”. The reason is that government, which is the major client, is not able to meet the timelines set in the contract for payments and in majority of cases, takes several months to pay”, he said.
He revealed that the government, in most cases, was also unwilling to pay interest on the delayed funds even when it is in the contract.
“Some indigenous contractors also sleep on their rights to enforce the conditions of contract that entitle them for compensation for fear of being victimised by their clients. Where some bold contractors make the attempt, they are blacklisted or branded as litigants”.
“The worse is that there is a requirement in most public procurement contracts that require contractors to indicate litigation history, that, in itself prohibits any attempt by an indigenous company to pursue the path of justice, he said”.
Mr. Dogbegah thus emphasised the need for the government to legislate availability of funds before projects are committed and also to legislate payment of interest on delayed payment as is the case in other countries including Britain, South Africa and Tanzania.
“This will create a conducive environment for developing the construction sector in Ghana and also support the agenda of transformation of the country through the private sector”, he added.Back to all News Items