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Promoting Good Governance.

SPOTTED: Defence Ministry asked to ‘pay itself’ N1.1b to renovate, roof buildings in 2017

THE Ministry of Defence literally proposed to pay itself a sum of N1.1 billion in 2017 for the renovation and roofing of buildings over a number of years, The ICIR has discovered.

This is according to the Bureau of Public Procurement (BPP) status report on certificates of no objections for the 2016 fiscal year (i.e. budget implementation calendar), which ran from January 1, 2016, to May 31, 2017.

According to the Public Procurement Act of 2007, a certificate of no objection is “the document evidencing and authenticating that due process and the letters of this Act have been followed in the conduct of a procurement proceeding and allowing for the procuring entity to enter into a contract
or effect payments to contractors or suppliers from the Treasury”.

The BPP document states that the Ministry of Defence requested for a total sum of N1.15 billion for a project titled “contract for the renovation and roofing of buildings”. The BPP subtracted N40.9 million from this sum and reviewed it to N1.1 billion.

Curiously, only N51.3  million — that is 4.6% of the entire project cost — was proposed as the first batch of financing for the 2016 budget. In the 2017 fiscal year, the proposed figure for funding the same project jumped to N150 million, and in 2018 it rose even higher to N400 million. It is expected that more funding will be demanded in subsequent fiscal years until all N1.1 billion is drained from the fiscal basket.

The report further revealed that the project implementation agency is the Nigerian Armed Forces Resettlement Centre (NAFRC), and the project contractor is said to be “direct labour by Nigerian Armed Forces Resettlement Centre“.

Direct labour is defined by the Oxford Living Dictionaries as “labour employed by the authority commissioning the work, not by a contractor.”

The certificate has the serial number, D-126, and was issued on January 13, 2017. Around that period, Air Vice Marshal Augustine Jekenu served as the Commandant of the Centre.

NAFRC: NOT A CONSTRUCTION COMPANY

Not only is it not a registered company, the NAFRC does not have any construction-related mandate nor is it intended to be a contractor. According to information on the Defence Ministry website, the vision of the centre is “to be a world class Training Institution capable of repositioning ex-servicemen and women to cope with challenges of service in their post-service life”.

Its mission, on the other hand, is stated as: “To consistently provide quality training, geared towards preparing Nigerian Armed Forces personnel to face the challenges of re-integrating into civil life.”

Media reports have established its role essentially to be training and ensuring the welfare of retired members of the Nigerian military. In December for instance, the NAFRC Oshodi training centre graduated 403 retiring soldiers after six months of teaching them new skills to ease their reintegration into society.

In April, a similar training, which was to last for two weeks, was flagged off for 39 senior military officers “to refocus the attention of retiring officers that a meaningful life can still be pursued after retirement”.

Last year, the commandant, Air Vice Marshal Augustine Jekenu, said plans were underway to make the centre a degree-awarding institution.

It is thus strange that the NAFRC is named as a project contractor, particularly taking into account documentary requirements for a certificate of no objection to be issued. These, according to the BPP, include evidence of advertisement, letters of invitation to bid, financial bids of pre-qualified contractors, and so on.

NIGERIA ARMY HAS AN ENGINEERING COMPANY

Though the Nigeria Armed Forces Resettlement Centre has neither mandate nor capacity to handle engineering works, the Defence Ministry has as an incorporated company that does. Sappers Engineering Nigeria Ltd (SENL), RC No. 785948, is an engineering and construction firm incorporated in November 2008 by the Nigeria Army (NA).

A subsidiary of the Nigerian Army Engineers (NAE), the company has its corporate headquarters in Bonny Cantonment, Victoria Island, Lagos.

Its projects include construction of roads at NASA, Kachia in 2008; drilling of boreholes in NA barracks; construction of Jato-Aka Bridge in Benue State; Nigerian Army Museum Complex Abuja; construction of a bridge over River Nukai in Jalingo, Taraba State; Kebbi Road construction project; among many others.

It also handled projects at the NAFRC Oshodi Training Centre: construction of the access road in 2005 and design and construction of Officers’ Hostel at NAFRC Oshodi in 2002.

DIRECT LABOUR NOT STRANGE TO MILITARY VOCABULARY

The expression ‘direct labour’, though generally strange in Nigeria’s procurement dictionary, is common in military budgets. In the 2017 appropriation bill of the Federal Ministry of Defence, the expression is used a total of 16 times; and a search for it in the 2018 approved budget returned 37 results. In the latter document, no other ministry is found to employ the term.

Unlike in the BPP document, however, four of the budget items in the 2018 budget specify that the direct labour is to be supervised by the “Nigerian Army Engineers.”

DIRECT LABOUR IS APPROVED BY LAW, SAYS PPDC

Responding to questions from The ICIR, Gift Maxwell, Budeshi Programme Director of the  Public and Private Development Centre (PPDC), said MDAs are permitted to resort to direct labour for many reasons.

According to her: “In the public procurement goods and works regulation 2007, ‘Direct Labour Account’ means the procurement of civil works by a procuring entity using its own internal personnel, equipment and resources

“It is a system where in-house professionals are allowed to be fully involved in the physical execution of government projects. MDAs may choose to engage in direct labour procurement due to several factors like cost, time, quality magnitude and specification of the project. Some MDAs have established units or departments set up within them to help achieve their desired goals of attaining value for money for their projects; for example, the Nigerian Army usually procures its direct labour services through the Nigerian Army Corps of Engineers.

“Direct labour system allows the government to proceed with its works at its own pace. In essence, execution of projects may stop when funds are not available without legal complication resulting in tussles which sometimes take years to resolve and hence delaying the project by as many years.”

She also explained that, depending on availability of resources, a budget implementation may take numerous years to be fully completed. “This would most likely continue for however long until the total project amount has been accommodated in the budget to enable project completion.”

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