The North Tongu MP, Samuel Okudzeto Ablakwa, has advised the Social Security and National Insurance Trust (SSNIT) to adopt the turnaround strategy that saved Labadi Beach Hotel years ago to rescue its other struggling hotels.
According to him, the current issues with SSNIT-owned hotels like La Palm Royal Beach and Elmina Beach Resort, which were once thriving, are due to poor management.
Speaking on PM Express on JoyNews, Mr Ablakwa, who strongly opposes SSNIT’s plan to sell stakes in its hotels as a strategy to raise capital, argued that selling is not in the state’s best interest.
“So Labadi Beach Hotel was struggling about some 13-14 years ago, then a wise board decision was taken at the SSNIT level that let’s bring in new management. They brought in Liberty from South Africa. They had an expert, a Dutch manager and signed a 10-year contract.
“Then they had strong local content for the locals who understudy this international best practice company and then after 10 years, the Ghanaians took over.
“It’s almost four years or five years now [since the Ghanaians took over] and they are even doing better than when the experts were there,” the North Tongu MP said on Tuesday.
He indicated that Labadi Beach Hotel is poised to pay more than the GH¢25 million dividends it paid to the government in 2023.
He suggested that if SSNIT is concerned about its investments due to the losses recorded by some of its hotels, it should adopt the same model used for Labadi Beach Hotel instead of selling its majority stake to Rock City, a “loss-making hotel.”
“Labadi Beach Hotel has given you a classic example of the intervention that you need to make, the medicine that is required. So selling, and divesting yourself of 60% shares cannot be an option. It cannot be the best consideration in the circumstance,” Mr Ablakwa said.
“Let us adopt a different leadership paradigm. I’ve already told you about what happened in the case of Labadee which has served us well, which is yielding fruit,” he further advocated.
Background
In May, Mr Ablakwa lodged a formal petition with the Commission on Human Rights and Administrative Justice (CHRAJ) to investigate allegations surrounding the sale of six hotels.
The hotels under scrutiny in the petition include Labadi Beach Hotel, La Palm Royal Beach Resort, Elmina Beach Resort, Ridge Royal Hotel, Busua Beach Resort, and the Trust Lodge Hotel.
Mr Ablakwa’s petition to CHRAJ seeks an investigation into various allegations, including conflict of interest, abuse of power, lack of due process, procurement breaches, cronyism, and graft.
Mr Ablakwa in his petition highlights what he views as a violation of constitutional provisions, citing Articles 78(3) and 98(2) of the 1992 Constitution.
However, SSNIT denied any foul play in its decision to sell a 60% stake in its hotels to Rock City Hotel owned by the Food and Agriculture Minister, Dr Bryan Acheampong.
According to SSNIT, this is a strategy to partner with an investor to raise capital to invest in their hotels, and also assist in their management.
SSNIT assured it will submit itself to the investigation by CHRAJ following Mr Abalwka’s petition.
Backlash
However, the news of the hotels’ sale drew massive backlash from stakeholders and organised labour.
The General Secretary of the Ghana Federation of Labour (GFL) expressed disappointment in their representatives on the board overseeing the sale of the hotels.
According to Mr Koomson, the representatives should have provided the union with first-hand information about developments at the board level that were not in their favour.
Organised Labour called for a restructuring regarding the use of workers’ funds by SSNIT. They argued that recent actions and inaction of SSNIT have been unsatisfactory.
They followed up with a petition to the president to halt the sale of the hotels to Rock City Hotel.
In response, President Akufo-Addo directed the Employment and Labour Relations Minister, Ignatius Baffour Awuah to engage in discussions with labour leaders.
The president’s goal is to find a mutually acceptable solution to the dispute, ensuring that the interests of all stakeholders are considered.
Also, the Trade Union Congress (TUC) revealed that SSNIT had not yet decided on selling 60% of its shares in four of its hotels to anyone.
Interacting with the media after a closed-door meeting with the SSNIT board on Thursday, May 30, TUC’s Secretary-General Dr Anthony Yaw Baah, said that the Trust is still considering proposals.
Nonetheless, he reiterated the union’s non-negotiable position that the transaction must be cancelled for broader consultations.
Demonstration
However, these interventions and assurances have seemingly not been satisfactory for stakeholders.
On June 18, hundreds of demonstrators gathered at the Labadi Beach Hotel for the “Hands Off Our Hotels” demonstration.
The main objective of the protest was to exert pressure on government to immediately halt the proposed sale of a 60 per cent stake in the four prominent hotels.
Mr Ablakwa who led the protest argued that the sale of state-owned properties to government officials constitutes a clear abuse of power that should not be tolerated.
The group submitted a petition to the president urging him to call off the deal completely.
Way Forward
To prevent Ministers of State and government officials from purchasing state assets in the future, Mr Ablawka assured the public that he is working round the clock to introduce a private members bill to prevent legislators and government officials from buying state assets.
According to him, these public officials are elected to manage state assets; therefore, they should not be the very individuals benefiting from such sales.
The legislator added that although the current law prevents these officials from engaging in conflicts of interest, many legislators still find loopholes.
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