An exclusive report on how over N60 billion was stolen from the pension funds of the Office of the Head of Service

This is the second in the series of our best investigative reports from last year. We are revisiting four of our best investigations in 2012 throughout January. This week, we revisit our story on the mindless pillage of pensioners’ money at the Pension Office of the Head of Service of the Federation.

The story, which was published on March 8, 2012, was the first in our series on pension fraud in Nigeria. Reports on fraud at the Police Pension Office and an attempt to cover up the scams have also been published.

Investigations into the fraud at the pension office of the head of service show that the director of the office, Sani Teidi Shuaibu, and his deputy, Phina Ukamaka Chidi colluded with bank officials and siphoned more than N60 billion of the funds meant for pensioners.

This they did by opening several illegal accounts into which they moved funds form the pension office. Thereafter, by a cobweb of dubious means including payment of ghost workers, award of bogus contracts, payment of collective allowances and outright stealing, the crooks at the pension office depleted monies meant for payment of pension and gratuity of retired civil servant.

At the time our story was published Shuaibu, Chidi and 30 others had just been charged to court on a 134 – count charge of conspiracy, fraud and corruption before Justice Adamu Bello of the Federal High Court, Abuja.

The monumental fraud had been discovered by the Pension Reform Task Team, PRTT, set up by former head of service, Steve Oronsaye, to reform the pension office. The PRTT, headed by Abdulrasheed Maina, reported its findings to the Economic and Financial Crimes Commission, EFCC, which investigated the matter and subsequently charged the culprits to court.

Our report was based on the EFCC investigation and our own independent enquiries. The findings were, indeed, mind boggling. Shuaibu alone was discovered to have more than N12 billion in his accounts. This is apart from assets worth several billions. All have so far been seized.

Also, investigators discovered more than N2.5 billion in Chidi’s house while over N35 billion was found in the illegal accounts opened by her and her boss.

One of the ways by which they pilfered pension funds was by putting ghost workers on the payroll of the pension office. The task team discovered that of 141,000 pensioners on the payroll, more than 71, 000 were ghosts.

The office had been collecting N5 billion every month for payment of pensions and gratuities but it was discovered that only N825 million was required for the purpose.

Read also:

• Justice Gladys Olotu Stirs Judicial Controversy
• ICIR Investigations of the Year: A Failed Romance
• Uniabuja Remains Shut, Now Home To Refugees

To perpetrate the fraud, Shuaibu, Chidi and others recruited several unscrupulous bank managers who helped them to open accounts without proper documentation so that the funds would not be traced to them.

The ICIR story gave details of several bank managers and how they helped register fake businesses and bank accounts for the pension crooks without the necessary know Your Customer, KYC, documentation.

Some of the bank managers even recruited other account owners they managed to pose as pensioners in order to receive illegal payments from the pension office, monies which were then paid back for a fee.

For their many illegal acts the bank managers were handsomely paid.

Curiously, though, while all the others involved in the scam have so far been charged to court, none of their collaborators in the banks without which the scheme would have failed has been brought to book. Officials of the EFCC keep telling our reporter that they are working on the case. The ICIR is set to do another story on the bankers who helped defraud the pension office.

IMPACT

There were four stories in the series on pension fraud in Nigeria and their impact can only be assessed collectively. The stories in the series included The Big Cover up, an expose on the attempt to cover up the pension scam; Looting Spree At Police Pension Office, a report of the pilfering of nearly N20 billion at the Police Pension Office and Pension Scam: How the Senate Betrayed Nigerian, which examined the Senate probe of the fraud.

First, the stories helped focus media attention on the pension fraud running into billions, thereby preventing a cover up. Investigation had actually shown that the stealing from pension funds had gone on for many years and the proceeds had been spread round to benefit civil servants, influential government officials, including those in the Presidency, as well as political parties. Infact, one of the pension rogues confessed that some of the stolen funds were used as slush funds for the election campaign of a major political party.

This informed why very powerful persons in the corridors of power tried to snuff life out of the investigations into the monumental scam.

Our story also helped to expose the bogus investigation carried out by the Senate, Some of the accused persons being tried in court had alleged that that the Senate committee on pensions and establishment collected a bribe of N3 billion from the money they stole. Although the chairman of the committee, Aloysius Etok, denied the charge, it had put a credibility slur on the body’s work. But the committee continued with its stained investigations.

In a cruel irony, the Etok – led committee appeared to want to protect the interest of the pension thieves but it has so far failed.

Read ICIR’s original story on how N60 billion was stolen by civil servants here

Gladys Olotu, an Abuja High Court Judge, overreaches herself in taking on an election petition about which the Supreme Court had ousted its own and any other court’s jurisdiction

The Federal High Court 4, Abuja,  is about to stir controversy and debate as its presiding judge, Gladys Olotu, is set to deliver judgment in an election petition case which the Supreme Court has said no court has jurisdiction to entertain.

Lawyers on both sides as well as other members of the bar and bench and other stake holders are watching keenly and waiting to for the outcome of Olotu’s ruling, but, it appears, no matter whom her judgment favours, there will be recriminations and controversy.

Feelers from both counsel to both respondents and defendants in the case, indicate that whoever loses in this case that has seen several dramatic turns and twists, will head for the appeal court, signaling another round of judicial shadow boxing.

On Tuesday, January 8, Justice Olotu will give her ruling on a case filed by Senators Abdu Umar Yandoma and Ahmed Sani Stores and nine other members of the Congress for Progressive Change, CPC, who contested the National Assembly elections in Katsina State.

The suit challenges the compliance by the Independent National Electoral Commission, INEC, the Senate President and the Speaker, House of Representatives, with a Supreme Court ruling delivered by Justice Walter Nkanu Onnoghen (JSC) and unanimously supported by five other justices on December 16, 2011.

The Case before Justice Gladys Olotu

In the suit instituted pursuant to Sections 68 (1) and 75 (1) and (2) of the Electoral Act 2010, the appellants are asking the court to determine whether INEC had any power to withdraw the certificates of return issued to all the ten plaintiffs as senators (two) and members of the House of Representatives (8) and  whether INEC has the right to issue new certificates of returns to another set of persons as winners in the election.

The plaintiffs also asked the court for seven declarative orders that INEC lacks the power to  “cancel, nullify, review, withdraw, void, invalidate” the certificates issued to 10 of them; that the electoral body lacks the power to issue new certificates to the 5^th – 14^th defendants; that the certificates originally issued to the plaintiffs are still valid; and that the Senate President, House Speaker and Clerk, 2^nd, 3^rd and 4^th defendants respectively “ought not to have sworn in the 5^th – 14^th defendants”.

The appellants also sought orders nullifying the certificates of return issues to 4^th – 14^th defendants as well as an order directing the 5^th – 14^th defendants to vacate their seats at the National Assembly.

However, all these issues had been trashed out and decided by the Supreme Court ruling of December 2011 and ought not to be entertained by any law court in the country by virtue of the fact that it is the highest court of the land.

In a case that had gone to the Federal High Court and the Court of Appeal before coming to the apex court, the Supreme Court on December 16 2011, in a ruling read by Justice Walter Nkannu Onnoghen and unanimously agreed to by Justice Dahiru Mustapha, Justice John Afolabi Fabiyi, Justice Mary Odili and Justice Olufunlola Oyelola Adekeye decided that the issue in dispute was the determination of who was nominated to contest an election which is the preserve of political parties.

The apex court ruled that it had no jurisdiction in the matter of who a political party nominates to an election and that the Federal High Court and Court of Appeal ought not to have assumed jurisdiction too.

Background to the cases in court

In January, 2011, in accordance with Section 85 (1) of the Electoral Act 2010, which requires a 21 day notice for political parties that want to conduct elections, the CPC national headquarters wrote INEC on Dec 24th 2010 giving notice of its primaries for the 2011 general election.

In the letter, the party said it would conduct all primaries on January 13 and submit lists of candidates to contest the April 2011 elections on January 14. The letter also intimated INEC of the constitution of a committee under Jibril Mohammed Hassan, a retired colonel, saddled to organize the Primaries.

The election was held as scheduled on January 13 and Aminu Bello Masari emerged the governorship candidate, Yar A’dua and Sirika were nominated as Senate candidates and others for other positions. The Board of Trustees of the CPC ratified the list of candidates from Katsina and on January 14, the party submitted the names of the candidates to INEC.

However, Yandoma and Stores who were defeated in the primaries protested the outcome of the election and, supported by the Katsina State chairman of the CPC, the duo formed a group which conducted another primary on January 15 and submitted a fresh list of candidates for CPC to INEC on January 16. INEC rejected this list because the national headquarters had submitted a list to it and the fresh one came a day later that stipulated in the timetable. In face, voter registration had already started by the time the Yandoma group gave its own list to INEC.

To fight INEC’s rejection of their list, Yandoma, Stores, Senator Yakubu Lado and 42 others sued the electoral body at the Federal High Court, Abuja. Joined in the suit were the CPC, its national chairman, Tony Momoh and Masari, its governorship candidate.

The suit instituted in pursuance of Sections 221, 222, and 223 of the 1999 Constitution and Sections 85 and 86 of the Electoral Act 2010 (as amended).

In the suit, the plaintiffs asked the court to determine four issues including whether the CPC is not bound to submit the names of the candidates that emerged at the January 15 primaries to INEC; whether INEC had the powers to disqualify or reject the last so submitted; whether the CPC had the powers to reject or substitute the names of the plaintiffs and, finally, if the plaintiffs should not be declared the flag bearers of the party in the general elections.

In his ruling on the matter on Jaunary 15, 2011, Justice Abdu Kafarati of the Federal High Court, Abuja upheld the arguments of the plaintiffs and granted their prayers, observing that “the plaintiffs have sufficiently proved that they are the candidates of the CPC IN April 2011 general election.”

Holding that there was nothing to show that any other primary election was conducted by the CPC in Katsina State, Justice Kafarati granted all the declarative and injunctive orders sought by the plaintiffs.

Based on this court ruling, Yandoma, Stores, Lado and others contested the elections on the platform of the party and interestingly many of them won their seats, including the three senatorial seats.

However, the CPC went to the Court of Appeal sitting in Abuja to contest the Federal High Court ruling. In the suit filed by the party, Masari and Momoh, on February 3, 2011, the plaintiffs asked the court to determine four issues and grant 12 declarative orders.

The issues they wanted determined were that whether the party was not bound to submit the names of candidates that it screened to INEC for the general election, whether it had the right to reject or disqualify the candidates who so emerged and whether the candidates on the list it submitted to INEC were eligible to contest the general elections.

The orders which the plaintiffs sought included declaration that its candidates be recognized as duly elected to represent the party, an order of perpetual injunction restraining the 1^st and 2^nd defendants  from presenting any other names to INEC for the election and an order of mandatory injunction compelling INEC to place its own candidates on the ballot.

In its ruling delivered on April 20, 2011, the Court of Appeal upheld the arguments of the CPC and consequently set aside the judgment of the Federal High Court. In a unanimous decision delivered by Justices Mohammed Lawal Garba, the court held that by the provisions of the Electoral Act 2010 (as amended) and the 1999 Constitution, the party at the national headquarters is the one statutorily empowered to organise primary elections, not any of its branches. The court averred therefore that the Katsina State Chairman of the CPC cannot usurp the powers conferred on the National Executive committee of the party.

“The issue of who should be a candidate of a political party in an election is an intra party matter which should be determined by the rules, constitution and provisions in the Electoral Act”, the court noted, adding that a court would only be involved ”where the provisions in the Electoral Act or the party’s constitution has not been complied to”.

The court held further that “the trial court was wrong in relying on the primary elections of 15th January, 2011 to hold that the 1st to 43rd respondents have sufficiently proved that they are the candidates of the CPC in Katsina State for the April 2011 general election. The decision of the trial court was not based on the overwhelming documentary evidence that the 13th January, 2011 primaries were sanctioned by the Board of Trustees of the appellants”.

Significantly, the appellate court held that “The primary held on 13^th of January, 2011 was properly conducted in accordance with electoral laws: and that “the grant of injunctive relief in favour of the 1^st to 43^rd respondents in the circumstances was wrong.”

It said further that “the trial court failed to determine the questions that were raised in line with the law’.

Based on all these the appeal court set aside the Federal High Court judgment.

The Supreme Court Case

Not satisfied with the turn of events, the Yandoma group headed for the Supreme Court to challenge the ruling of the Court of Appeal and the subsequent withdrawal by INEC of their certificate of return and their replacement in the National Assembly.

For the Supreme Court, it decided that the fundamental issue for determination was which of the two lists of candidates emanating from two primaries can be regarded as genuine.

The court agreed with the argument of Ahmed Raji, counsel to INEC, the 5^th respondent, that under Section 87 (9) of the Electoral Act where the issue is as to whether there was a primary election or not or which of two different primary elections was valid, then the court would have no jurisdiction in the matter.

On this matter, the court declared that the responsibility of choosing candidates for election was that of the political party and that a court of law cannot perform that role. The Supreme Court ruled that it did not have the jurisdiction to hear the matter; neither did the Federal High Court nor the Court of Appeal.

“In the instant case, the jurisdiction in question is statutory and very limited in scope. On the face of the claim it would appear that the courts have jurisdiction under section 87 (4) (b) (ii), (c) (ii) and (9) of the Electoral Act 2010 (as amended). If the right being claimed by the appellant and in dispute between the parties arose from the primaries of 15th January 2011 alone,” it ruled.

Once there arises a dispute as to which of the two primaries a right of candidature on the parties to represent a political party in an election, the matter is taken outside the purview of Section 87(4)(b)(ii),(c)(ii)(9) of the Electoral Act 2010 (as amended).”

In conclusion, the court held that “the courts have no jurisdiction to determine the matter in dispute. Consequently, suit no. FHC/ABJ/CS/126/2011 and appeal nos CA/A/133/2011, SC/157/2011 and SC/334/2011 are hereby struck out for lack of jurisdiction.”

In essence, what the Supreme Court ruled was that the candidate whose names the CPC decided to forward to INEC were the lawfully elected representatives of the party in the 2011 election.

Based on the Supreme Court ruling INEC withdrew the certificates of return issues to Yandoma and Stores along with 8 members of the House of Representative and re – issued same to candidates sponsored by the CPC national headquarters.

Based on the certificates presented to them, the Senate President and Speaker of the House also immediately swore in Yar A’dua and the others.

It is these actions predicated on the ruling of the Supreme Court that Yandoma and Stores and others have gone before Justice Olotu to challenge. The issues raised in the suit before Olotu are the very same previously brought the courts and which the apex court has declared cannot be entertained by them because they lack jurisdiction.

Some legal experts believe that the contention of the appellants is that the Supreme Court did not grant declaratory orders to warrant the withdrawal of the certificates issued to Yandoma and others, but point out that the apex court could not have granted any orders in a matter it has said it has no jurisdiction. Besides, it is said, the court’s ruling could not have been effected without that action being taken.

Why the private sector shuns public infrastructure financing in Nigeria

The International Centre for Investigation, ICIR, this weeks, starts the republishing of some of our biggest investigative reports of 2012. Every week, this month, we would be going back to one great investigative done in the last twelve months, talking about the process of reporting, providing updates and examining any possible impact our work has had.

We start the series with the story of the failure by the federal government to get the private sector interested in financing public infrastructure, a situation that threatens the much vaunted goal of being one of the best 20 economies in the world by 2020.

Our investigations showed that, at that time, the projects so threatened included “a light rail system and the Kuje water works both in Abuja; Sagamu – Benin – Asaba highway; Abuja – Kaduna – Kano road; Lagos – Kaduna – Kaura Namoda – Nguru rail line; the Port Harcourt – Kafancha – Maiduguri rail line and the Kiri Kiri Lighter Terminals 1 and 2.”

They also include projects in the health and housing sectors slated for private sector financing.

This failure arose  from the experience of previous partnerships between government and the private sector which crumbled woefully. The federal government had courted the private sector for years to help fund some key infrastructure in the country.

The efforts yielded fruits with the concessioning to private sector players of of the nation’s 26 seaports, the airports, the MurtalaMuhammed Airport Terminal 2, MMA2 and the Lagos – Ibadan expressway.

However, the romance quickly soured as virtually all these concession agreements either ran into serious trouble, ended up in court or just simply failed.

The idea to do the story actually started with concerns over the diplorable condition of the Lagos – Ibadan expressway and a close look at the concessioning agreement granted Bi Courtney Highway Services to reconstruct the road. But eventually, we decided to use the particular project and the embarrassing story of its failure to examine the bigger phenomenon of public private partnership debacle in the country.

In 1999 then minister of works, Lawan Hassan, who is now facing corruption charges in court and Wale Babalakin, chairman of Bi – Courtney, who is also  on trial on money laundering charges, announced with pomp and pageantry that the very important road was to be given a new lease of life in four years.

The N89.5 billion concession agreement granted Bi – Courtney which covers 105 kilometres of the 126 kilometre road, gave the company rights over the expressway and its access points and a 60 metre right of way throughout the length of the expressway. By the agreement, the company had rights over every commercial activity on the road including granting of land rights to commercial petrol stations and outdoor advertising and billboards for a period of 25 years.

The design, build, operate and transfer agreement meant that the company would source funds to reconstruct the road, turning it into an 12 – lane expressway with world class infrastructure, manage and collect toll on it and after 25 years return the project to government.

However, it soon became obvious that Bi – Courtney could not muster the resources to finance the project. Until last year when the federal government revoked the agreement, Bi – Courtney which had four years to complete the project was still deceiving Nigerians that it had gotten finance to execute the project

The federal government finally revoked the concession agreement with Bi – Courtney on November 2012 three and a half years after it was signed.

However, beyond revoking the contract, the government has not strictly followed the letters of the agreement.

Several sections of the agreement spell out penalties for default. For example, Article 3.1 (d) of the agreement says that “Upon termination of this Agreement under Article 3.1 (c) and (d), the Grantor (the federal government) shall be entitled to encash the Performance Bond to the extent of the damage caused to the Grantor.” The government cannot execute this clause because Bi – Courtney never provided a performance bond on the contract. But rather than the government suing the company, it is Bi – Courtney that has threatened to take the matter to court.

IMPACT

The ICIR report was published on February 1, 2012 and it helped focus media attention on the continuing deplorable condition of the road and generated follow up stories in other media. Several newspapers subsequently picked up and followed the story of the failed concessioning of the Lagos – Ibadan expressway.

The media kept up the reportage of the failed concession until the te government revoked the agreement only a few days after President Goodluck Jonathan threatened to do so after a Presidential Media chat where he was asked why his government had not thought of dealing with the problem of the road.Finally, the findings of our investigation – that  Bi – Courtney lacks the capacity to execute the project – has found support in thhe government’s action..

Read ICIR’s original investigative report here

Tongues wag at the NNPC over Oil minister’s disruptive management style

Nigeria’s controversial oil minister Diezani Alison – Madueke’s management style which is disrupting the governance structure of the Nigerian National Petroleum Corporation, NNPC, is causing concern in the state oil giant and the industry.

The powerful oil minister has rendered some administrative structures and personnel, including the position of permanent secretary, redundant with her penchant for using personal assistants in her office to conduct high level official duties.

Alison – Madueke rules the rich oil ministry like a personal estate, with lax work ethics, ignoring laid down rules and procedures and bypassing hierarchical order to achieve her goals.

In the process, staff of the corporation allege, the minister has compromised professionalism and undermined discipline.

One of the most worrisome of the minister’s disruptions in the oil ministry is her style of working from home. Alison – Madueke has developed a knack for working mainly from her official residence in Asokoro District in Abuja, visiting the office only very infrequently.

Even a perfunctory observation of activities at her residence shows that she runs things from there as the ceaseless activity and security presence show.

It was gathered that the minister goes to her office at the NNPC headquarters in the Central Business District in Abuja mainly on Wednesdays, after the Federal Executive Council, FEC, or when she has to meet foreign dignitaries or important Nigerian oil industry executives.

Concerned sources confided that because of her ‘operate from home policy’, she forces a lot of ministry – related meetings to be held in her house, thus disrupting official schedules of key personnel.

She holds such meetings up to three or four times a week in her residence, usually making key personnel, including the group managing director of the NNPC, and even whole departments of the corporation, to relocate to her house.

Many of the senior staff of the oil corporation who are forced to attend such meetings are fed up with the situation but dare not complain about it.

Apart from the administrative toll and man hour lost to having to move the corporations operations to her house, even more burdensome is the financial cost of the minister’s decision to operate from home.

Each time she holds her usually big meetings in the house, the minister gets the catering department of the Transcorp Hilton Hotel, Abuja to serve a buffet.

Our enquiries indicate that the hotel does not engage in such outdoor catering services for a client with less than 50 guests at a time.

With a total of three or four meetings a week, by our calculations, the minister spends between N2.5 million to N4million on food and drinks sweetly at official meetings held at her residence.

In a month, that costs between N10 million to N 16 million. And in a year, Alison – Madueke blows between N120 million and N192 million on such indelicate culinary  extravagance.

The bills are entirely picked up by the NNPC, meaning that the burden for such mindless spending is borne by Nigerian tax payers.

Another worrisome aspect of the minister’s style is her utter disregard of rules, guidelines and official protocols and procedures, bothering on highhandedness. Nothing more aptly explains this than her employment of Eric Ufo as a senior special adviser/consultant.

Ufo is the oil minister major domo, a veritable man Friday who does all kinds of odd jobs for his principal. With no experience in the oil and gas industry, his employment has all the ingredients of Diezani – Madueke’s disdain for administrative rules and protocols.

The minister initially signed on Ufo on as a special adviser however, out of the blues she changed his engagement and rather engaged the services of the young man’s company to offer consultancy services for a fee of N37 million annually. This bill was hung on the NNPC, though Ufo in practice, works for and ought to be paid by the petroleum ministry.

As if the controversies surrounding his employment were not enough, Ufo has become a tin god in the oil corporation, calling the shots and undermining the positions of senior management staff, including the group managing director to whom he routinely issues directives.

Information by sources inside NNPC show that Ufo, bandying the minister’s name around,  tried his executive high handedness with former group managing director of the corporation, Austen Oniwon, who rebuffed him.

The former GMD is said to have seriously warned the special adviser to the minister never to write him directly but through proper channels, which is to go through the minister’s office.

Using his closeness with the minister, Ufo subsequently caused some tension between the oil giant’s chief executive and the oil minister which persisted until the former was replaced in June.

However, the new GMD of the NNPC is said to be less assertive, thus allowing Ufo to have more than an elbow room to interfere in the daily running of the corporation.

A classic example of the enormity of the power Ufo now wields on account of being “madam’s errand boy”, is his overriding of the routine directive to transfer an employee of the NNPC from one department to the other.

The employee, Uzoh Ejidoh, had been sanctioned for some misdemeanor and transferred from the public affairs department to the human resources department but Ufo overrode the transfer directive and instructed that she should instead be transferred to his office, a directive that was immediately carried out.

Ejidoh was employed in 2005 into the public affairs department on NNPC on grade SS 3 having claimed to have had some experience. It was gathered that NNPC employs two categories of staff at this level – fresh from school, for new graduates who are placed on grade SS6 and experienced higher for persons with at least five to 10 years’ experience who come in on level SS3. It is said that it takes about 10 to 15 years to move from SS6 to SS3.

A few years into her employment, Ejidoh wrote a petition to the corporation’s human resources department complaining that she was not properly graded. This, she did, after some other persons with longer years of experience had been employed and placed on SS 2, higher than hers’

Investigations into her work history however revealed to the management that having graduated only a couple of years before her employment she did not possess the experience she claimed to have.

Rather than elevate her above those she complained had been wrongfully promoted above her, she was demoted to SS 5 and redeployed from public affairs to human resources department. However, former head of the public affairs department, Livy Ajuonuma, who died in the Dana air crash in June, refused to release her.

However, after Ajuonuma died, Ejidoh ingratiated herself with Ufo, the minister’s trusted and powerful aide who  got her transferred to the minister’s office to work under him.

To effect Ejidoh’s transfer, Ufo actually brazenly and against all rules of hierarchy and protocol, wrote a memo to the GDM of NNPC requesting him to redeploy her to the minister’s office where she now works with and reports to the special adviser.

Many senior management staff of the corporation are angry at the manner Ufo goes about dropping the minister’s name to get favours but they are scared to complaining because of the young man’s closeness to his boss.

Another evidence Alison – Madueke’s high handedness and absolute disregard for rules is her employment of domestic staff on the bill of the NNPC. The minister has a retinue of domestic staff who work in her residence.

Ordinarily, with her position as minister, she is allowed about two domestic workers in her residence. But Alison – Madueke has several domestic staff but rather than pay them from her pocket, she found a way to include them on the payroll of the NNPC.

Apart from this, the flamboyant minister also has a penchant for travelling abroad with her retinue of personal aides, including several domestic staff. When she goes on her frequent foreign trips, the NNPC is made to pay for the flight tickets and accommodation of these domestic staff.

What is more, she also make the corporation pay estacode to the domestic servants each time she travels abroad.

Attempts by www.icirnigeria.org to get the minister to react to our story were unsuccessful. The public affairs manager of the NNPC, Fidel Pepple, who also doubles as the minister’s spokesman refused to speak to us.

Our reporter spoke to Pepple last week and it was agreed that questions relating to the story be mailed to him. However, since last week, the minister’s spokesman has refused to respond to the e mail or answer the questions. Also, reminder text messages sent to him have been ignored.

There is not much to show for all the money spent on the Abuja – Makurdi road

Sani Musa, Adamu Yahaya are men who confront death virtually every day. But they are not martyrs or militants fighting a cause. The duo are ordinary Nigerians who eke out a living as commercial motor drivers.

That profession, in Nigeria, where roads are death traps, must rank as one of the most dangerous in the country. However, this is more so for the Makurdi-Lafia-Akwanga stretch of the Makurdi – Abuja road where motorists and commuters literally daily stare death in the face.

This is due mainly to its deplorable state and its meandering nature, particularly at the Akwanga hills.  But as  commercial drivers who convey passenger from Lafia to Abuja in their taxis daily, Musa and Yahaya do not have a choice but to brace up for the fatal possibilities that the road offers.

Thomas Anajav is not a driver but a public servant who lives and works in Abuja. However, he faces the same risk as he travels to Makurdi almost every weekend to spend time with his family

The three men as well as many other Nigerians constantly stand the risk of losing their lives on this road particularly the Akwanga axis, which has been tagged the “many have gone” stretch, due to its hilly and dangerous curves and the number of lives lost in accidents.

In a bid to reduce the danger to human lives, the federal government, in 2009, awarded a 13.3 kilometer stretch of the road to ENL Consortium at a sum of N3.3 billion for the re-alignment and straightening of the hilly and dangerous curves between Akwanga and Lafia with a completion time lime of 18 months.

As it happens with such projects in Nigeria, three years on, the job is yet to be completed and the people continue to bear the brunt of government inefficiency.

It has become increasingly more dangerous to ply this road now with the many diversions and roadblocks everywhere mounted by the contractor working on it. Indeed, in the last three years, it has become the drivers’ nightmare as it poses great danger to both human and vehicular traffic, Sani laments.

 
But, in spite of this obvious danger to both his life and that of his vehicle, Sani, who is an indigene of Gako, a small village close to the Akwanga hills, has no choice but to continue to do the only job he has in order to feed his family of six and an aged mother.

He expressed worry why the work on the road is taking so long to complete.

Like Sani, many Nigerians including members of the House of Representatives are raising eyebrows as to why the road contract is taking so long to be completed.

Some even allege that the contractor has abandoned the original job and concentrated efforts at crushing and selling the rocks found at the Akwanga hills to the detriment of some sections of the road that have been cleared but are now been threatened by erosion.

A visit to the site by our reporter revealed that while some sections of the road have actually been completed, others, particularly along the hills and Gako village, are begging for attention as erosion is seriously threatening them.

In an interview with our reporter, the project manager of the contract, Femi Ojo, an engineer, actually admitted the delay in the completion of the job but attributed this to problems the contractor, ENL Consortium, has encountered in the course of executing the contract.

According to him, the first of these was the difficulty of setting out with the drawings they got from the consultant who deviated from government’s brief by about five kilometres. This, of necessity, had to be corrected but they had to get approval from the federal ministry of works in Abuja which took time.

Having overcome the problem of drawings, the company also encountered delay in arrival of the needed equipment which, according to Ojo, was ordered from China.

“This delay was so prolonged that we had to reorder some of these machinery from Ghana but that too had to be delayed at the border between Ghana and Nigeria for almost three months waiting for clearance,” Engineer Ojo stated.

He further noted that at the time these initial problems were overcome, the rainy season had set in so it was not possible to do any serious construction.

“Then there is the problem of the rocky nature of the area and we know that you cannot make as much progress when working on rocks as when working on flat ground.”

But as with similar projects, perhaps, the biggest problem the road construction has faced is the non-release of funds to the contractor by the federal government. Engineer Ojo confirmed the issue of late payments which he said has been a serious drawback to their work.

Giving an example of how non release of fund affects the job, Ojo said that the valuation certificate raised for payments since 2011 was paid only in June 2012.

“So, it is not possible to move as fast as people expect us to yet we are making steady progress,” he lamented.

Asked to state how much of the contract sum has been released so far, the project manager said N1.3 billion out of the total contract sum of N3.3 billion had so far been paid to his company. He, however, observed that by the time the money came it was in the middle of the wet season, so not much could be done.

He, however, gave the assurance that with the weather now becoming more clement, concerted efforts will be made to complete the job even if it means working in the night.

On the allegation that the company is busy crushing and selling the rocks at the site, Ojo denied this saying that it was not true as the rocks along the road cannot be used as they are soft and muddy. He pointed out that the heap of chippings seen at the site was brought from their quarry at Mpape.

This was confirmed by sources from the ministry of works zonal office in Lafia.

Engineer Ojo, however, acknowledged the concern of the House of Representatives committee on works on the road contract adding that both the committee and the ministerial task force on contracts have visited the site to assess the progress and quality of the job.

Sources at the Zonal office of the federal ministry of works in Lafia who would not want to be named confided that only 48.17% of the work paid for had been done by the contractor, which they said is not encouraging.
With regards to the quality of the work done, the source maintained that it met all the required standard and specifications and attributed this to what is called “preventive supervision.”

Meanwhile commuters and youths of Gako including Huseni Muhamed and Moses Daniel Maga who spoke to our reporters are not impressed with what they termed “excuses”  and they  expressed displeasure at the slow pace of work while calling on the government to find a more competent contractor to handle the road.

They based their argument on the paucity of equipment owned by the contractor. “There is no time you will find more than a few earth moving machines on site,” Maga stated.

A visit to the site camp of the construction firm seemed to confirm Maga’s misgivings as only a few earth moving equipment were seen parked there while two excavators and three tippers were seen working at the most critical section of the road at Akwanga hill.

At the company’s Abuja office, ENL House at AMAC PLAZA in Wuse Zone 3, only a few staff members were seen milling around at the time our reporter called. The senior general manager who received our reporter but declined giving his name said the managing director had travelled out of the country and directed all enquiries to the project manager, Engineer Ojo.

Investigations by www.icirnigeria.org, however, revealed that part of the reason why work on the road has been slow is because the contractor had moved most of its equipment to Lafia, the Nasarawa State capital, where it has a contract to construct many of the major streets in the town.

Several visits to the federal ministry of works to find out why the contractor is taking so long to execute the contract, what government is doing about that and how much the contractor had collected so far failed as the deputy director of highways, North Central, who was said to be the right person to talk said he did not have time to talk.

The last time our reporter tried to speak with him, he was on his way to Lokoja to help create a way around the flooded Lokoja-Abaji-Abuja road.

Information on how much has been spent on the road over the years was difficult to come by but checks showed that  N530 million was appropriated in 2012 to the project out of which N170millon has been accessed by the contractor.

While commuters and drivers that ply this road are desperate and cannot wait to see this road project completed, Engineer Ojo told our reporter that the contract completion date has been extended to October, 2013. Independent checks at the supervising ministry, however show that the deadline was only extended to September 2013.
This means those drivers and commuters who ply the road have to endure until 2013, if not beyond, to see an end to their agony.

The National Housing Fund, NHF, has failed to help solve Nigeria’s housing problems

Emmanuel Akinola Omoyeni, is an angry man. A retired civil servant, he served his fatherland for 35 year. In 18 of his years of active service, he made monthly contributions to the National Housing Fund, NHF, through the Federal Mortgage Bank of Nigeria, FMBN.

By the time he retired from the ministry of internal affairs – now renamed ministry of interior – Omoyeni probably thought he would have saved enough money to qualify to obtain a loan to build a house.

But to his chagrin, the retiree who is also the national chairman, Association of Retired Federal Public servants, has not been able to get a loan from the mortgage bank to build a house.

But what has got the man really riling is the fact that, having denied him access to a loan, the NHF and FMBN have also refused to refund the money he contributed over the years.

He, along with thousands of others Nigerians, has been told that he cannot collect back his money until he is 60 years old. That is what the law says, they have been told.

“What is more terrible about the scheme is the fact that the government and the people managing it are not ready to pay the retired workers even their contributions,” he moaned.

“We have written several letters to the institution concerned to no avail. The last time we went to FMBN, they told us that until one clocks 60 years in age, one is not qualified for even one’s contributions,” Omoyeni lamented further.

“My candid opinion therefore is that, this scheme should be scrapped as it has no benefit for the workers. Rather it is a way of siphoning money from serving officers,” he concluded in anger and frustration.

Like Omoyeni, Pius Ukeji, a retired school principal, is also a perceptibly bitter man. He is bitter against a Nigeria he served for years which now appears to have left him in the lurch after sucking him dry of the energy of his productive years.

The embittered educationist, who contributed N600 to the NHF every month for close to 10 years, is lamenting that he is unable to raise a N4 million loan to build a house because no viable primary mortgage institution, PMI, exists in his area to grant him a loan.

Cornelius Moedi, also a retiree, cannot understand why all of a sudden, he is being told that he cannot access his contributions to the NHF until he is 60. He retired from the federal civil service in 2007 after working and contributing to the scheme for five years.

However, having left service he has asked for a refund of his total contributions only to be told he has to wait until he is sixty years old.

“This is unfair because we were contributing to the scheme in the hope of getting houses, but since that failed they should refund our money now that we are retired and still alive,” Moedi pleaded.

But he asks an important question when he queries: “What happens to those who do not reach 60 and die? Will their families be able to collect their contribution when they are dead when the retired civil servants themselves could not do so when they were alive?

The story of Caroline Abang is not any different. As a serving level 9 officer in the federal civil service, she too is not impressed by the Federal Government’s Housing Scheme for its workers.

Having been a contributor to the NHF for over a decade, she told our reporter that when she applied for a loan to build a house, she was told that she must have a certificate of occupancy, C of O. After struggling for months to get one, she went back for her loan but has been unable to get it even after a year.

Abang is mystified and at a loss explaining what really is going on.

“As a grade 09 officer, my money is supposed to be N3.5 million. The question I keep asking myself is ‘when are they going to give me the money?’” she wondered, adding listlessly, “I need the money”.

Although housing is not one of the millennium development goals, MDGs, it is accepted all over the world, along with clothing and food, as one of man’s basic needs without which he cannot survive.

But in Nigeria, providing housing for citizens has always been a problem that has defied solution. The country currently suffers from a deficit of 16 million houses, which requires no less than N56 trillion to finance at an average cost of N3.5 million per house.

Nigerian governments since independence in 1960 have vowed to make the best out of this very ugly housing issue without success. Each government, either military or civilian, has set panels, commissions, or agencies to recommend ways of improving and highlighting it as a major priority, yet in over 52 years, Nigeria has not developed a vibrant housing policy.

Houses have continued to be provided through the rigorous traditional method of buying land and building over some years, which could be in an individual’s entire life time. In most cases, the buildings are left uncompleted, becoming a burden for children and family of the deceased.

It was in an attempt to deal with the housing problem that the FMBN was set up in 1956. The bank has the overall mandate of promoting the delivery of affordable and modern houses to Nigerians.

The bank started the management and administration of the contributory savings scheme, the NHF, established in 1992 as a pool that mobilises long – term funds from Nigerian workers, banks, insurance companies and the federal government to advance loans at low interest rates to its contributors.

However, an overwhelming number of contributors to the scheme, serving and retired, who spoken to our reporters have tales of woe to tell. Many claim that they have neither benefited nor seen any one that has taken a loan directly from FMBN to build or buy a house since its inception.

Many of them also complained that they are made to go through PMIs to access at high interest rate – usually 21 per cent – the funds which they contribute at low interest rates. Thus, they see the scheme as a conduit pipe designed to drain the meagre resources of the civil servants.

Very few people, however, still believe that the NHS has helped to solve some of the housing problem faced by Nigerians. One of them is director of personnel services in a federal ministry who does not want to be named.  He does not agree that the FMBN should be scrapped either.

According to him, the mortgage bank has been able to mobilise funds into a common pool from which individuals, organisations, and state governments can draw through the PMIs to provide affordable houses for the citizens.

He cited the example of Gombe State which he said accessed funds from NHF and has used it to build a housing estate for its civil servants. He therefore advised other state governments to buy into the scheme to provide decent accommodation for their citizens.

Another believer in the NHF initiative, understandably thought, is Balami Yerima, the group head of public sector, home finance division of Aso Savings and Loans Limited. He believes that it is a good way of getting long term funds to provide affordable houses for Nigerians.

“It is a laudable scheme geared towards mobilising long time funds from Nigerian workers and other agencies to advance loans at soft interest rates to its contributors. Given the challenges and huddles that confront the scheme, I would say it has done fairly well,”Yerima stated.

But even in his enthusiasm, he concedes that “The scheme too has its challenging huddles and barriers, adding that “we cannot deceive ourselves that it has been a complete success.”

But none of the supporters of the government housing programme could explain why many civil servants who individually contribute to the scheme cannot access loans to build houses.

Beside this, Nigerians in the informal sector also stand little chance of benefiting from the NHF scheme. This was attested to by Shola Ade, a motor mechanic in Area 1, Garki, Abuja, who lamented that they are neither allowed to contribute to the housing scheme nor draw from it, in spite of their willingness to be part of the scheme if given the chance.

He wants FMBN to design a more inclusive scheme that will take care of artisans and those in the informal sector as they too deserve decent shelters over their heads.

Several attempts by our reporter to speak with Gimba Ya’u Kumo, the managing director of FMBN failed as he, according to Agada Simeon, head, corporate affairs of the bank, prefers doing his work to talking about it.

Simeon, who initially directed our reporter to the housing minister to seek answers to the list of questions earlier sent, later sent three documents which were meant to address the issues raised.

The documents include a paper by Kumo titled: ‘Funding Options for Housing Delivery in Nigeria’ presented at Potomac Workshop on ‘Recharging Government Contract Administration and Project Management Processes,’ held at the International Conference Centre, Abuja in June 2012.

Also included were two press releases, one titled “FMBN Introduces E-Collection Platform for National Housing Fund” and the other titled ‘FMBN Offers N2bn Mass Housing Loan to Enugu State.’

In the paper, Kumo observed that “essentially, the FMBN is statutorily mandated to pool resources for delivery of mass housing in Nigeria.” This responsibility, he acknowledged, is by no means an easy task.

He noted that NHF is a government – backed funding scheme which pools small contributions from workers (2.5 per cent of their basic salaries) both in public and private sectors of the economy for the purpose of delivering decent and affordable houses for the masses. Since inception in 1992, he said, the scheme had registered 3.7 million contributors as at May, 2012.

The MD further stated that under the scheme, a total of N88.43 billion has been collected as at May 2012 out of which N86.93 billion housing loans have been disbursed while 68,712 housing units have been financed.

Listing the challenges faced by the scheme, Kumo said, “One is that some employers of labour do not comply with the law establishing the NHF which mandates them to deduct 2.5 per cent of their workers’ basic salary and remit same to the NHF Account.”

Also, he disclosed, some employers make the requisite deductions but fail to remit the full amount with a schedule of their contributing employees to FMBN, while other employers deduct but fail to make any remittance to the NHF Account.

This, he noted, partly explains why the number of contributors to the scheme has remained significantly low at about 3.7 million persons as against the over 50 million targeted at inception meaning that only 2.46 per cent of the nation’s projected 150 million people are contributing to the scheme.

Another formidable challenge faced by the scheme as identified by the Kumo is that all the banks and insurance companies which are required by the NHF Act to invest a percentage of their funds in the scheme have, over the years, failed to comply with this requirement just as the Central Bank of Nigeria, CBN, which is the regulator of the financial institutions, has also failed to compel the banks to comply with the provisions of the law.

What all these means is that more than N100 billion of the estimated NHF contributions are trapped in government ministries, departments, agencies and other organisations.

Checks by our reporters show that to tackle some of the challenges, the FMBN recently introduced an e-collection platform for the housing scheme. The platform makes it possible for NHF deductions, collections and remittance to be done electronically by all the designated commercial banks in Nigeria through their existing information technology structures.

With this e-collection platform, NHF components of employee’s salaries are not only automatically deducted and instantly channelled into a dedicated NHF account but also a payment schedule indicating the identity of each employee and the amount contributed is automatically generated and FMBN immediately credits each contributor’s NHF account with the corresponding amount remitted for that month.

The e-collection platform is not only designed to curb the sharp practices that enable some unscrupulous employers to misappropriate NHF monies or even embezzle such funds but to also help promote transparency and accountability in the collections as well as make it possible for more eligible Nigerians to access NHF loans for building, renovation or purchase of residential houses.

The platform also makes it possible and easy for contributors to check their NHF accounts using the NHF e-cards on any ATM nationwide, not only to ascertain the amount they have contributed but also to be in a position to know if their employers are making the appropriate remittances as and when due.

Indeed, the system instantaneously sends an SMS alert to the contributor’s mobile phone once the deduction hits the NHF collection account. The e-collection platform is thus embedded with features that seek to secure contributors’ contributions in order to restore their confidence and bring more credibility to the scheme.

The snag, however, still is that no withdrawals can be made from the NHF account until the contributor retires from service and reaches the age of 60 years. This has generated a lot of bad blood between the FMBN and NHF contributors, particularly retired public and civil servants.

While the contributors are keen on collecting back their contributions since they did not benefit from the scheme, the FMBN insists that the contributors must satisfy the requirements for refund as specified by the NHF Act 1992.

While the new management of FMBN has begun the process of cleaning the Aegean Stables through the repayment of contributions with interest and the publication of same in national dailies, many civil and public servants who spoke to this website insist that the mortgage bank should waive the 60 year age requirement for retired contributors to enable them look for their housing requirements elsewhere.

Our investigations however show that one of the greatest problem that work against ordinary Nigerians owning affordable houses is the Land Use Act which vests all land in the country in the government.

This invariably makes state governors the only approving authority to issue certificates of occupancy. This singular fact impacts negatively on citizens’ access to housing in so many ways.

This much Yerima agrees to when he said that “the problem however is with the Land Use Act,” adding, “the land use act as presently constituted makes it very difficult, even near impossible, to transfer title from one party to another and this one party could be a private mortgage bank offering the mortgage or just an individual from whom one wants to buy a property.”

For many experts, Yerima actually hit the nail on the head because many of them identify the difficulty in securing or transferring land title deeds as a major problem facing those who want to build houses. And it does not exclude even civil servants and other NHF contributors who want to obtain loans to build houses.

As Abang observed, one of the conditions of granting housing loans under the NHF is that an applicant must have a C of O, as proof that he or she has a land to build on. However, this condition constitutes a roadblock for many as such permanent land title deeds are not easy to come by.

“The barriers to transferring titles are too formidable and invariably impinge on the cost of housing. It usually takes a long time for even executive governors to sign Certificates of Occupancy (C of O). Even after the signing, there are the problems of stamp duties and payments, which are enormous for any would-be mortgage,” Yerima observed.

He explained further that because of the barriers created by the Land Use Act, many of the titles available for mass housing are development leases which are ad hoc arrangements between developers and state authorities. The snag is that they fall short of the real thing and banks are wary of such temporary titles, preferring the root title, the C of O.

“Any bank, and this includes FMBN and Aso Savings, would want the root title of any land to be certificate of occupancy (C of O) because that is the only perfectible document that one can hold up in court in the event of a default and when the need to carry out a foreclosure between a mortgage bank and a mortgagee arises,” Yerima noted.

He said further: “a lot of banks will not touch these weak titles including the development lease. Moreover, we cannot float a bond to raise long term funds for mortgages on these weak titles.”

More worrisome, he noted is the fact that these imperfect title documents also discourages foreign investors interested in the  housing sector from bringing in needed funds to develop it.

The Aso Savings and Loans manager’s damning verdict is that “affordable housing will be very difficult to achieve if the present Land Use Act is maintained.”

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