Ministry of Defence contract scam, local content in oil industry, other highlights from House of Reps

The House, last week, gave a nod to the Presidency’s $5.5bn borrowing plan and passed resolutions on issues including consumer protection, infrastructural development (East-West road, second Niger bridge, etc), an alleged contract scam at the Ministry of Defence and local content in the oil and gas industry.

Details below; 

1. $5.5bn External Loan Request Approved: The House, on Tuesday, approved the Executive’s $5.5bn loan request. During a press briefing, House spokesman, Hon. Abdulrazak Namdas said that this was done because assurances had been given that the country will not sink into recession once more and projects which the loan is meant for, such as the Mambilla power project, are critical to national development. He also said that the legislature would carry out its constitutional oversight functions in order to ensure that the funds are judiciously spent.

“Already, the loan is captured in the 2018 budget. The executive is insisting that the borrowing will reflate the economy, help create jobs and improve the state of our dilapidated infrastructure…..borrowing is part of ways to rejig the economy not only in Nigeria, but all parts of the world. We have no doubt that the loan will be put to good use and lead to creation of jobs”, Hon. Namdas said.

2. Ministry of Defence Contract Scam: Also on Tuesday, Hon. Tajudeen Yusuf moved a motion of urgent public importance on an alleged multimillion Naira contract scam at the Ministry of Defence involving some high-ranking officers in the ministry. He stated that the contract was supposedly for the relocation and refurbishment of a level 2 hospital under the United Nations multidimensional integrated stabilization mission in Mali. The House mandated the Committees on Defence, Army, Finance, Public Procurement and Financial Crimes to investigate the matter and report back to the House within two weeks.

3. Local Content in IOC’s: The House resolved to investigate compliance with local content laws by International Oil and Gas companies. This followed the adoption of a motion by Hon. Daniel Reyenieju on the need to investigate the violation of the Nigerian Oil and Gas Industry Content Development Act (NOGICD), 2010 in the refusal of International Oil and Gas Companies to use local assets and marine facilities owned by Nigerian companies.

Hon. Reyenieju, while moving the motion, said that that the Nigerian Oil and Gas Industry Content Development Act (NOGICD), 2010 was enacted to ensure measurable growth of Nigerian content in the oil and gas exploitation processes, and section 12 of the Act makes it mandatory for first consideration to be given to Nigerian companies in the evaluation of bids for goods and services. He added that although Section 15 of the Act requires all Operators and Alliance Partners to give full and fair opportunity to indigenous contractors and companies, vessels acquired by indigenous companies are lying fallow because their services are not being engaged. The Committee on Local Content was mandated to conduct the investigation and report to the House within 4 weeks.

4. East-West Road: The House adopted a motion (moved by Hon. Betty Apiafi) on the need to complete construction work on the East-West road, particularly the Rumuokwurusi Interchange (Oil Mill Junction) to Onne (Eleme) Section. The road cuts across South-South states and is of strategic commercial importance as those states play host to a number of national and multinational Oil and Gas companies, fertilizer plants, seaports and several other Federal and State Government institutions which are of immense importance to the economy of the nation. She stated that the contract for the construction of the road was awarded in 2006 by the Federal Government to Setraco Nigeria Limited and Julius Berger Nigeria Plc and was initially billed to be completed by 2010, but that could not be achieved, and it was subsequently taken over by the Ministry of Niger Delta Affairs (MNDA) in 2010, at 10% completion.

The total contract sum for the road was put at ₦349.87 billion, out of which about 90% has been paid for work executed on the 338 kilometers dual carriage way that has about 41 bridges along its stretch, and the Federal Government, in 2014 approved a further sum of ₦165.2 billion for the completion of the Road, but so far, only 90% partial completion of the 87.4 kms Warri-Kaiama section 1 in Delta/Bayelsa States has been achieved, the 101 kms Kaiama-Port Harcourt section 2 in Bayelsa/Rivers States has attained 52% completion, while the 51kms Eket-Oron stretch of sections 3 and 4 in Akwa Ibom State have attained 88% and 89% completion, respectively. The House urged the ​Federal Roads Maintenance Agency (FERMA) and the Niger Delta Development Commission (NDDC) to, as a matter of urgency, intervene in the rehabilitation of the failed sections of the Aba Road/Eleme Junction to Onne junction, and the ​Ministry of Niger Delta Affairs (MNDA) to ensure the completion of the East/West Road, particularly the section that links the multi-national investment during the 2018 budget year.

The House also ​called on the Executive to look for alternative funding source for the East-West Road for speedy completion and ​mandated the Committees on Niger Delta Development Commission and Legislative Compliance to ensure compliance and report back within four (4) weeks for further legislative action.

5. SEC Board: The House ​has called on the Executive to expedite action on the reconstitution of the Board of the Securities and Exchange Commission and the appointment of Executive Commissioners to fill vacant positions. This was sequel to the adoption of a motion by Hon. Yusuf Tajudeen, who noted that since the dissolution of the Board of the Securities and Exchange Commission (SEC) by the Federal Government on 16 July 2015, the regulatory agency has not been able to effectively and efficiently carry out its responsibilities.

He further stated that the failure to appoint Executive Commissioners to fill the three vacant positions has slowed down the general administration, operations and monitoring duties of the Commission as the regulator of the Capital Market, and that the non-constitution of the Board for over two years now is posing both regulatory and reputational challenges to SEC, creating delay in approvals from the supervising Ministry of Finance, causing non-formalisation of broad economic, financial, operational and administrative guidelines and targets for the Commission, as well as lacking in streamlined monitoring of performance and evaluation of institutional projects and programmes.

6. Second Niger Bridge and Lagos-Ibadan Expressway: Following the adoption of a motion by Hon. Solomon Bulus Maren on the need to investigate the nature of the contract and/or concession arrangement on the second Niger bridge and the Lagos – Ibadan expressway, the House resolved to ​urge the Federal Ministry of Power, Works and Housing to include funds in the 2018 budget for the completion of the projects and mandated the Committee on Works to investigate the nature of the contracts and concession arrangement.

Hon. Maren, while moving the motion, said that contracts for construction of the Second Niger bridge and reconstruction of the Lagos-Ibadan Expressway have continued to feature in the annual budgets without any seeming signs of their completion or the amount required to do so, and that the Nigeria Sovereign Investment Authority (NSIA) had spent about ₦18 billion on the projects as the financier during their early stages.

He further stated that the completion of the projects is pivotal to national development and expressed concern that the manner of execution of the projects is not in accordance with defined methods for executing projects and /or contracting procedures, and that unless proactive steps are taken to ensure early completion of the projects, the efforts that have been made to ease the transportation difficulties of the people would have been in vain, businesses would continue to suffer heavy losses and operational costs, while the originally intended aim of galvanizing the various interests of Nigerians through the execution of the projects will remain unfulfilled.

7. Non-release of NEEDS Assessment Intervention fund: Hon. Samuel Ikon moved a motion on the non-release of National Economic Empowerment and Development Strategy (NEEDS) Assessment Intervention Fund and the consequences on the nation’s educational development. He stated that between December 2011-January 2012, academic activities at public universities were suspended owing to the non-implementation of the 2009 Agreement between the Federal Government and the Academic Staff Union of Universities (ASUU), and that in a bid to nip a re-occurrence in the bud, the Federal Government set up a Committee on National Economic Empowerment and Development Strategy (NEEDS) Assessment of Public Universities with a view to carefully considering specific and general needs of those Universities.

Upon completion of its assignment, the Committee submitted its report to the National Economic Council (NEC) on 1 November, 2012, leading to the constitution of Stakeholders Committee on National Economic Empowerment and Development Strategy (NEEDS) Assessment of Public Universities, and that at a meeting with the Nigerian Labour Congress (NLC), the Trade Union Congress (TUC) and the Academic Staff Union of Universities (ASUU) on the need to revitalize public Universities, the Federal Government resolved to release the sum of ₦1,300,000,000,000.00 (One Trillion, Three Hundred Billion Naira) only (aside annual budgetary allocations and regular Tertiary Education Trust Fund (TETFUND) intervention).

He expressed concern that till date, only the initial payment of ₦200,000,000,000.00 (Two Hundred Billion Naira) had been paid into the account, leaving the outstanding balance of ₦1,100,000,000,000.00 yet to be released, and that failure to release the funds as at when due has hampered the infrastructural development of public universities and may further disrupt the smooth academic programmes at universities if not quickly addressed.

The motion was adopted and the House resolved to mandate the Committee on Tertiary Education and Services to investigate the non-release of the National Economic Empowerment and Development Strategy (NEEDS) Assessment Intervention Fund to public Universities and report back in four (4) weeks for further legislative action.

8. House moves to curb excessive electricity charges: The House adopted a motion by Hon. Dapo Lam Adesina on the need to curb excessive electricity charges being levied on consumers by Distribution Companies (DISCOs) through prepaid meters, and ​urged the Federal Ministry of Power, Works and Housing and the Nigerian Electricity Regulatory Commission (NERC) to investigate the quality of the new MOJEC prepaid meters being installed by the Distribution Companies and phase them out if they do not meet up with the standard requirements with a view to protecting the interests of electricity consumers.

9. Ogoni Clean Up: Hon. Kingsley Chinda moved a motion of urgent public importance remembering the late Ken Saro Wiwa and other Ogoni activists, and seeking that action be taken on environmental degradation in the Niger Delta region. He urged government at all levels to promote environmental sustainability and avoid degradation and called on the Executive to hasten the clean up of Ogoni land.

10. House Probes N8.6bn SIWES Fund: The House, through the Committee on Industry, also commenced an investigation into the alleged mismanagement of N8.6bn Students Industrial Work Experience Scheme (SIWES) fund by the Industrial Training Fund.

The following bills were presented for first reading;

1. Nigerian Financial Intelligence Agency (Establishment) Bill, 2017 (HB.1210) (Hon. Kayode Oladele)

2. Hate Speech (Prohibition) Bill, 2017 (HB. 1211) (Hon. Aminu Sani Jaji)

3. Nigerian Tourism Development Authority Act (Repeal and Re-Enactment) Bill, 2017 (HB. 1212) (Senate)

4. Hydroelectric Power Producing Areas Development Commission (Establishment, etc.) Act (Amendment) Bill, 2017 (HB. 1213) (Senate)

5. Presidential Inauguration Bill, 2017 (HB.1214) (Senate)