The upper chamber of the National
Assembly has begun an investigation into the Nigeria Port Authority (NPA) over
irregularities in the award of the N7.5 billion contract.
The contract, according to the Auditor
General of the Federation’s report submitted to the Senate for consideration,
was for shore erosion control work at Akipelai, Ayakoro and Otuoke in Bayelsa
state.
The Senate Committee on Public Account chaired by Senator
Matthew Urhoghide hinged the Investigation on 2017 Auditor General’s report
submitted to the Senate. The contract was in March 2012 with 14 months completion
period. But, as at November, N4.2 billion has been paid, which represents 56.61
percent of the contract sum to the contractor.
However, review of quantities (BOGs) under
No- 1 attachment revealed that mobilization fee of N1.1billion paid to the
contractor was supported by a conditional bank guarantee from Zenith Bank Plc
with validity for 365 days, which expired on the 2nd March 2013, contrary to
the Provision of section 35 ‘1’ of procurement Act 2007 and Financial
Regulations 2933 “1” (2009) which only provide for submission of an
unconditional bank guarantee or insurance bond.
But, NPA in a written response to the
allegation claimed that enbloc recovery of mobilization fee may create a
financial strain to the project hence the need to recover the fee in piecemeal.
Also, it was revealed that the sum of N19.5
million was paid for Toyota Hilux double cabin petrol engine; however, there
was no evidence to confirm that these vehicles were purchased.
In the NPA response to the allegation, the
agency claimed that the Toyota Hilux was purchased.
In another observation by the Auditor
General, N128 million provided for insurance against damages to persons and
properties, was certified and paid through certificate No-3 with no evidence
that any insurance was undertaken.
But, NPA in its response said; “Noted for
future compliance. Payment for insurance of the works was carried by the
contractor as required to the tune of the approved amount. The particulars
of the insurance are usually retained by the contractor.”
In addition, the interim valuation
certificate No 4 dated November 11, 2015 showed that the value of works
executed as the period was N3.9billion representing 52.07 percent.
But, the total amount paid to the contractor
was N4.2 billion representing 56.61 percent of the contract sum and it implies
that contractor was paid more than the work executed by N344 million.
The query reads: “A contract for Shore
Erosion Control Works at Akipelai, Ayakoro and Otuoke towns in Bayelsa State
was awarded at a contract sum of ₦7,503,344,599.00 (Seven billion, five hundred
and three million, three hundred and forty-four thousand, five hundred and
ninety-nine naira), vide award letter Ref. No.: HQ/GME/CP/CON/R.16/067 dated
22nd March, 2012, with 14 months’ completion period.
“As at 11th November 2015, four
(4) payment certificates and an advance payment totalling ₦4,247,938,353.26
(Four billion, two hundred and forty-seven million, nine hundred and
thirty-eight thousand, three hundred and fifty-three naira, twenty-six kobo) representing
56.61% of the contract sum, had been paid to the contractor.
“Review of documents and the Bill of
Quantities (BOQs) under Bill No. 1 (General) attached to these payments
revealed that: • Mobilization fee of ₦1,125,501,659.85 (One billion, one hundred
and twenty-five million, five hundred and one thousand, six hundred and
fifty-nine naira, eighty-five kobo), paid to the contractor, was supported by a
conditional bank guarantee from Zenith Bank Plc. with a validity period of 365
(three hundred and sixty-five) days which expired on the 2nd March, 2013,
contrary to the provisions of Section 35 ‘1’ ’a’ of the Public Procurement Act,
2007 and Financial Regulations 2933 ’i’ (2009) which only provide for
submission of an unconditional bank guarantee or Insurance bond.
“More than 4 (four) years after expiration of
the bank guarantee, the contractor fails to renew it and the balance of
unrecovered advance payment stood at ₦539,452,959.95 (Five hundred and
thirty-nine million, four hundred and fifty-two thousand, nine hundred and
fifty-nine naira, ninety-five kobo).
“The sum of ₦19,500,000.00 (Nineteen million,
five hundred thousand naira) was paid for the purchase of 3 (three) Toyota
Hilux double cabin petrol engine vehicles; however, there was no evidence to
confirm that these vehicles were purchased.
“The sum of ₦13,500,000.00 (Thirteen million,
five hundred thousand naira) was made for annual running cost of the project
vehicles, in which ₦6,750,000.00 (Six million, seven hundred and fifty thousand
naira) was certified and paid to the contractor, but there was no evidence to
show what the amount was used for.
“The sum of ₦11,250,000.00 (Eleven million,
two hundred and fifty thousand naira) certified for compensation of properties
to be affected by the project and paid in Certificate No. 3, had no records on
how the money was utilized nor the beneficiaries involved. ₦12,500,000.00
(Twelve million, five hundred thousand naira) provided for Community Relations,
was certified and paid vide Certificate No. 3 with No supporting documents to
validate the payment.
“₦128,000,000.00 (One hundred and
twenty-eight million naira) provided for insurance of the works and insurance
against damages to persons and properties, was certified and paid through
Certificate No. 3 with No evidence that any insurance policy(s) was undertaken.
“The Principal Manager’s (QS) report on
Interim Valuation Certificate No. 4 dated 11th November 2015 showed that the
value of works executed as at the period was ₦3,903,668,868.75 (Three billion,
nine hundred and three million, six hundred and sixty-eight thousand, eight
hundred and sixty-eight naira, seventy-five kobo) representing 52.07% of the
contract sum.
“However, the total payment made to the
contractor was ₦4,247,938,353.26 (Four billion, two hundred and forty-seven
million, nine hundred and thirty-eight thousand, three hundred and fifty-three
naira twenty-six kobo), representing 56.61% of the contract sum. This implies
that the contractor was paid more than the work executed by ₦344,269,484.51
(Three hundred and forty-four million, two hundred and sixty-nine thousand,
four hundred and eighty-four naira, fifty-one kobo).
“During inspection of the project, it was
revealed that the contractor had since abandoned the project site; and the
duration of the project had since lapsed without approval for its extension,”
the query said.
NPA is expected to appear before the
Committee to make oral presentation of the response to the query
(Daily
Independent)
