‘Strengthen procurement process’ — ALL the recommendations of senate on NDDC

The senate approved 16 recommendations after it concluded its probe into the alleged mismanagement of funds by the interim management committee (IMC) of the Niger Delta Development Commission (NDDC).

The probe began in May after George Sekibo, senator representing Rivers east, sponsored a motion on the alleged mismanagement of N40 billion by the commission.

Olubunmi Adetunmbi, senator representing Ekiti north, headed the panel of the upper legislative chamber.

At the hearing, Kemebradikumo Pondei, acting managing director of the commission, said since he assumed office in February, the interim committee has been ofpaying contractors owed for years.

Pondei also defended the N3.14 billion his management committee disbursed to its 4,000 workers and police commands in nine states as COVID-19 relief.

But the senate indicted the interim management and asked it to refund N4.9 billion “extra-budgetary” expenses after it considered the report of the probe panel on Thursday.

Here are the recommendations by the upper legislative chamber reproduced in full;

Reconsideration of executive oversight

For the purpose of consistency and equality of policy, there is a need to review the inconsistencies and differences in the apex control of these development commissions. In retrospect, the original arrangement of putting these commissions in the Presidency should be carefully reconsidered to allow for direct Presidential oversight in view of the huge public resources allocated to them. Section 7 (3) of the NDDC Act already provides for this president supervision.

Appointment of the board of directors

The absence of a Board of Directors at NDDC created a major lacuna of oversight. The Ministry of Niger Delta is culpable of negligent supervision and could not function as effectively as a board would have done. Therefore, the committee strongly recommends that the President should activate the statutory provisions in the Act and the Board of Directors validly nominated and call for fresh nomination for confirmation by the Senate.

Inauguration of other accountability mechanisms

The monitoring committee and the advisory Councils should also be inaugurated along with the Board of Directors as provided in Sections 20 and 21 of the NDDC Act. This is necessary to ensure that there are sufficient checks and balances in the internal affairs of the NDDC.

Improvement of governance/processes

The new Board should be made to undertake a review of the existing governance framework, with attention to upgrading the way and manner the board executes its mandates, with a view to re-establishing a new culture in the organization. The review must bring order to the workings of the management and their control of the organization.

This is necessary for the improvement of the structures and processes of the NDDC especially having witnessed two interim managements with seemingly loss of control on project and staff expenditure.

Restoration of a budget-led system

That NDDC Management must henceforth promote the use of its approved annual budget as the principal instrument and authorization for all its expenditures. The testimonies from Public Hearing gave sufficient insight into NDDC’s disregard for its budget, as several expenditure items were done without reference to budget provisions. As at the time of writing this report, the Adhoc Committee’s request for a report of budget performance from the NDDC has not been provided.

Submission of quarterly and annual performance report

That NDDC be reminded of its responsibility to submit its Quarterly and Annual Performance Reports as and when due as stipulated in Sections 19 and 20 of the NDDC Act. Such submission must also be duly passed to both houses of the National Assembly as stipulated in the law.

Initiation and supervision of forensic audit

In order to ensure that the forensic audit achieves the purpose for which it is set up and inspire confidence in the operational and financial processes of NDDC, oversight of the audit should be transferred to the Office of the Auditor General of the Federation. This will guarantee independence, credibility, transparency and professionalism in the output of the exercise. Furthermore, the Committee recommends that the President with advice from the Auditor General should appoint a renowned, internationally recognized Forensic Auditor to carry out the exercise.

Strengthening of procurement process

That the NDDC must strengthen its procurement department through appropriate staff engagement (e.g. by appointing staff with procurement chartered status), staff training and formulation of appropriate industry rated internal control measure specifics to procurement function to forestall sharp practice in its bids and tender process.

There are assertions of blackmail by NDDC against members of the National Assembly on the subject of the procurement process, this must be investigated by the Senate Committee on Ethics and Privileges.

Refund of extra-budgetary expenditure

That the sum of N4.923 billion payment made to staff and contractors in breach of procurement process and approvals should be refunded to the Federation Account with immediate effect as highlighted below; Overseas Travel to the United Kingdom N85.7 million, Scholarships Grants N105.5 million, union members trip to Italy N164.2 million, Lassa fever kit N1.96 billion, public communication N1.12 billion, COVID-19 relief N1.49 billion

All expenditures on historical contracts and obligation e.g Hotels, court judgement etc should be refunded as payments are not provided for in the budget.

Business Process Re-engineering (BPR)

That NDDC should be made to undertake a thorough and substantial Business Process Re-engineering (BPR) without prejudice to the much- awaited Forensic Audit, covering its areas of operation thus:

Review of operation and processes

Standard Operating Procedure (SOPs) in the Commission must be reviewed, upgraded, reinstituted with full documentation and formal training conducted, then translated into readable materials and manuals for guidance of current and future of the Commission. That NDDC must engage a new governance system around projects and contracts from advert to award and then to delivery. This involves the pre and post-implementation step to be taken for an effective delivery of projects.

Review of financial/accounting processes

That NDDC must review its financial system to ensure its adequacy in terms of controls and flexibilities with a view to ensuring that a robust financial report is produced out of the system at all times. This reform will also ensure that all compliances measures that fosters governance and accountability traits are captured in the system in form of coding of transactions, hierarchy and secured access/control.

Review of human resources policy

That the management must agree a policy to refocus the staff, and management of the NDDC based on its core mandate. This will be a blend of human resource reform and training. This reform must lead to a robust organogram based on staff need, it must also cover the engagement of staff, staff orientation mandate, appraisal systems and eventually severance of work relationships.

Instituting performance based organisation

For NDDC to deliver on its mandate, it must immediately imbibe some of the processes associated with high performing organizations. These include target setting for employees, performance appraisal linked to a reward system and the evolution of a new corporate culture. Present attitudes that tend to view the NDDC as a source of easy money must be discouraged. This attitude is also closely tied to the narrative that has characterised succeeding management.

It is akin to a self-fulfilling prophecy that has in itself led to a vicious circle that seems to suggest ‘we are financially imprudent because we operate in an environment of siege where we must continuously appease our stakeholders’. But doing this as they deprive the region of the needed development which also reinforces restiveness and creates the siege environment. This circle must be broken through a new culture and awareness by which the Board and Management of NDDC understands its responsibility to engender a new thinking and strong focus on infrastructural development of the region. A new approach to human resource management is desired.

Enhancement of internal and external audit capacities

That management must review the service level agreement they currently hold with their external auditor with a view to making a change of auditor. There are a lot of merits in our opinion, to change the external auditor, given the level of systematic failures already listed in this report some of which should have been resolved by an effective audit regime.

Review of Corporate Social Responsibility policy (CSR)

That the management embark on a CSR review to restructure and reshape NDDC’s social responsibility to its staff, community and the public at large in order to properly ensure an equitable and responsible delivery of these responsibilities without losing focus of its corporate mandate. The scope of this review should include condolences, community relations and stakeholders engagement.