Posted on December 20, 2016
By Segun Adebowale, The Eagle Online
The Civil Society Network Against Corruption, which is a coalition of over 150 anti-corruption organisations, has urged the Economic and Financial Crimes Commission to investigate the Nigerian Ports Authority over an alleged by-passing of procurement laws on contracts worth N717 billion.
In a petition signed by the coalition’s chairman, Olanrewaju Suraju, CSNAC said it is demanding an urgent investigation into the matter in order to entrench corruption-free Ministries, Departments and Agencies in Nigeria.
Taking its lead from the November 29, 2016 publication of an online newspaper, Premium Times newspaper, the coalition said the month-long investigation by the medium revealed how officials of the Nigerian Ports Authority allegedly by-passed procurement laws to corner N717 billion worth of contracts.
It said that the investigation also detailed how NPA officials were allegedly found to have brazenly and fraudulently by-passed Nigeria’s public procurement law in awarding multi-billion Naira contracts to handpicked contractors.
CSNAC said: “It was discovered, according to the Newspaper, that at least N717 billion in juicy contracts have so far been illegally awarded to a single contractor, violating the provision of the Nigerian Public Procurement Law (PPA) that says contracts of such magnitude should go through open competitive bidding.
“The PPA Act, enacted in 2007, prescribes principles by which public procurement entities within the various Federal Government Ministries, Departments and Agencies should conduct their affairs.
“Despite the PPA Act, PremiumTimes disclosed how NPA officials carried out unparalleled impunity by ingeniously creating a way of circumventing Nigeria’s procurement regulations through carefully engineering what appears to be a fraudulent process of disguising contracts as Joint Venture projects between the authority and companies of their choosing. Whereby, the processes of choosing the joint venture partners are never thrown open as well as the procedures for awarding contracts to them.
“PremiumTimes further disclosed that the one company featuring prominently in the so-called joint venture arrangement was Bonny Channel Company Limited. In its own official document, Bonny Channel Company Limited (BCC) describes itself as a Public Private Partnership (PPP) arrangement between the NPA and The Channel Management Company, through a joint venture agreement signed on June 23, 2014. While the Channel Management Company, TCMC, is described as a technical consortium made of Dredging International, Vinci and IPEM, the share structure arrangement gives 60 per cent to NPA and 40 per cent to TCMC.
“It was revealed that BCC is to ‘create and maintain a safe navigational passage for all marine users to and in the eastern ports of Bonny Island, Onne, Okrika and Port Harcourt’. It is alleged that for the past ten years, beginning from 2006, BCC carried out two major contracts a year; one in Rivers Port and the other in Onne Port. In 2006, the contract sum allegedly awarded without passing through the standard procurement process was 127 million dollars.Total contract figure were 163.2 million dollars,195.4 million dollars, 143.4 million dollars, 192.1 million dollars in 2007, 2008, 2009, 2010 respectively. And in year 2011, the sum of contracts awarded to BCC for projects in Rivers and Onne ports was 327 million dollars. Total contract sum was 300.2 million dollars in 2012; 296.3 million in 2013; 328.6 million dollars in 2014 and 286.2 million in 2015.
“Surprisingly, it was also discovered that the same contract of “Capital and Maintenance Dredging” is awarded to the BCC Joint Venture year after year, leading to BBC being awarded a total of $2.4 billion (or N717.3 billion) contracts over the past 10 years, in disregard for the nation’s procurement law.
“PremiumTimes further allegedly gathered that this ‘deal’ of joint venture partnership is not limited to BCC in NPA’s circumvention of the nation’s procurement laws. Investigations by this newspaper showed that the agency arbitrarily awards N750 million worth of contracts annually to SeaView Properties Ltd, another so-called joint venture, to provide various categories of environmental services.The company in turn awards these contracts in batches of N2 million to sub-contractors. And the contract award by the sub-contractor is done through an internal advert process that is not subjected to the public procurement law. Premium Times reported that a top official of the authority disclosed that the threshold is maintained at N2 million to retain the award threshold to domicile with the MD of the company and below what is required for public tender. These small lots of N2 million are found to be inefficient and cumbersome as the scope does not seek to maximize value for money but just to ensure that the contract award is not subjected to public tender.
“It was further revealed that the NPA also set up joint venture structures that gave birth to companies such as Lagos Channel Management (LCM) and Calabar Channel Management Limited (CCM). PremiumTimes investigation allegedly discovered that the same CCM has a working relationship with another company called Nigeria West Minister Dredging Marine Limited. It is these handpicked companies, some of them amorphous, that NPA parades to give a semblance of compliance with the Procurement Act under its restrictive tendering. Other times it is just single bid process involving only one company. The Lagos Channel Management Company manages the Lagos Pilotage District (incorporated in August, 2005 by NPA with an equity shareholding of 60 percent and 40 percent equity to the Joint Venture partner, Depasa Marine International).
PremiumTimes also disclosed that in August 2016, the new Managing Director of NPA, Hadiza Bala Usman, was quoted by the News Agency of Nigeria (NAN) as saying there was need to look at some of the funds expended on capital and maintenance dredging. She said the funds used for such dredging projects in the past ‘should not be that high’. ‘She stated that it’s good time for NPA to compare capital dredging and maintenance dredging’. When Ms. Bala Usman was contacted, she said she had been taking stock of affairs at the NPA since she assumed duties in July, and that one of the areas her team was scrutinising was the procurement system in the agency. She further stated that the procurement system will surely be overhauled to ensure it complies with the PPA and Bureau of Public Procurement’s regulations.
“For instance, at the second board meeting of Seaview Properties last week, it was directed that henceforth, contracts will be classified into lots that are efficient and the authority will advertise them in line with BPP and if the subsidiary or joint venture wants to bid, they can, alongside other companies. NPA will commence the process of the new lot sizes and scope and will have a public tender process of awarding the contracts.
“She also mentioned that by 1st quarter of 2017, the process will be completed and new contractors that have gone through a public tender process will emerge and take over and this will also apply to other joint ventures and subsidiaries as a way forward,” the petition read.”
Source: The Eagle Online
