PDS Deal Collapsed Due to Mismanagement and Personal Interests –  President Mahama

President John Dramani Mahama has attributed the collapse of the controversial Power Distribution Services (PDS) deal in Ghana not to the concept of private-sector participation in electricity distribution, but to the “mismanagement and personal interests” that surrounded it.

Speaking during a public engagement, President Mahama underscored that the structural framework underpinning the PDS arrangement was fundamentally sound and aligned with industry best practices, but the way it was handled derailed its success. “It was not a bad concept; what went wrong was the execution, the orientation of some key players whose personal interests superseded public interest,” he stated.

The PDS deal, initially signed in June 2021 between the Ghanaian government and a consortium led by PDS, was aimed at a long-term concession to manage and upgrade the country’s electricity distribution network. Under this arrangement, the consortium would have been responsible for electricity supply to over nine million consumers across the Eastern, Northern, and Volta regions, as well as parts of the Ashanti Region. The agreement included major commitments to infrastructure investment, network rehabilitation and improved service delivery.

However, the contract was terminated in October 2022 by the government of then-President Nana Addo Dankwa Akufo‑Addo, citing concerns over lack of transparency, inadequate performance by the contractor and alleged breaches of the deal’s terms. Critics have since pointed to the deal’s failure as emblematic of deeper governance issues in the power sector.

In his remarks, President Mahama made clear that his concern is not with private-sector involvement in utility provision per se, but with how such partnerships are managed. “We are open to public-private partnerships in key sectors, but if you bring in private partners who view the arrangement as a way to serve narrow interests, then you undermine governance and you reduce value for the country,” he said.

He added that personal enrichment, lack of accountability and failure to meet performance benchmarks undermined both investor confidence and public trust. The President said that the misalignment of interests between the government, the contractor and other stakeholders distorted the incentive structure of the contract.

The government has since instituted new reforms in the electricity sector aimed at strengthening due diligence, enhancing transparency and holding private partners to higher standards. President Mahama made reference to an ongoing review of major distribution contracts and the establishment of a monitoring framework to ensure that similar deals will not falter in the future.

The PDS deal’s collapse generated significant public concern, particularly given the vital nature of electricity supply in driving economic growth, industrial development and household welfare. At the time of termination, the Minister for Energy raised concerns that the contractor had not achieved agreed performance milestones and that investment pledges were not being honoured. The abrupt end of the deal triggered a renegotiation of distribution arrangements and raised questions about risk allocation, contract governance and institutional capacity in Ghana’s energy sector.

Following President Mahama’s remarks, industry commentators noted that the issue goes beyond PDS and reflects structural challenges in large-scale infrastructure contracting in Ghana. These include ambiguous contractual terms, weak oversight, political interference and limited capacity within state institutions to monitor complex performance-based deals.

President Mahama’s public statement may signal an orientation shift for his administration’s approach to public-private collaborations, placing greater emphasis on the quality of governance rather than the mere act of privatisation or concession. His pledge to address past failings and improve future frameworks has been welcomed by reform advocates, though they caution that implementation remains critical.

The full implications of the President’s comments are yet to be seen. Whether the reforms announced will deliver more effective outcomes or simply repeat past mistakes, will depend on how rigorously institutions follow through on oversight, enforcement and transparency.

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