2019 audit queries: Reps quiz NDDC over N70.495bn awarded contracts

•As 1,773 contractors allegedly absconded after collecting mobilization fees •Summon Bank Chiefs over ABG status •As NDDC puts outstanding ABG to be recovered at N19bn

The House of Representatives at the weekend flagged off its investigation into the N70.495 billion allegedly paid by Niger Delta Development Commission (NDDC) to 1,773 contractors as mobilization fees without resorting to site, between 2008 and 2012.

Chairman, House Committee on Public Accounts, Hon. Wole Oke who presided over the investigative hearing into the audit queries from the Auditor General for the Federation (AuGF) for the period under review, underscored the need for the NDDC acting Managing Director, Prof. Pondei Kemerbrandikumo to provide details of the projects and list of all defaulting contractors along with a statement of accounts showing the recovered funds as alluded to by the NDDC acting Director of Internal Audit, Mr Itu Eno Ubi who argued that only the sum of N19 billion ABG is yet to be recovered from the contractors.

According to the Auditor General of the Federation, 219 audit queries were issued by the oAuGF against NDDC.

As stipulated in the audit report, 90% of the contractors collected the mandatory mobilization fees without resorting to the site between 2011 and 2012, for contracts that ought to be completed within 6 months.

However, 60% of the contractors had during the Auditor General of the Federation’s investigation, argued that they have completed the projects, adding that these claims are frivolous and cannot be verified.

While noting that the same contractors were being recycled by the Commission, the AuGF, maintained that the action taken by NDDC management has done more harm to the system over the years.

To this end, the AuGF in its recommendations urged the House Committee on Public Accounts to ensure that NDDC management explains the rationale behind the contractors’ failure to execute the projects after collecting the mobilization fees, the status of the bonds signed by the contractors and explain why appropriate actions should not be applied to the contractors.

In his response, the NDDC acting Managing Director who was represented by Acting Director of Internal Audit, Mr Itu Eno Ubi, argued that the funds were released to the banks that guaranteed the contractors.

He added that the funds have been recovered from some of the erring contractors leaving the balance of N19 billion outstanding ABG against the N70 billion outstanding alluded to in the audit queries.

He maintained that the management of NDDC made frantic efforts to recover the outstanding ABGs from the banks, adding that some of the contractors were unable to complete the projects due to the general insecurity situation in the oil-producing region.

In his remarks, Hon. Oke who frowned at the failure of the Commission to address various issues raised in the audit queries between 2008 and 2012, said: “what the Auditor-General did was to invoke section 4 of the Audit Act to discover the anomalies in the NDDC.

“The main issue is whether the Interim Management Committee has rendered the account up to 2018. We stopped at 2018 due to the coronavirus pandemic, but clearly there are issues here and there.”

While stressing the need to ensure accountability of all public funds accrued into the coffers of the Commission, the lawmakers directed NDDC management to provide the letters of award of all the contracts, the Commission’s statement of accounts showing the refund of more than N50 billion as claimed by the acting Director Internal Audit.

The lawmakers also unveiled resolve to embark on physical inspection of all the projects with the view to ascertain the veracity of the claims made by NDDC.

On the other hand, the Committee resolved to formally direct all the banks being operated by NDDC to submit documentary evidence on the status of the ABG tendered by the contractors with the view to ascertain whether the ABG has expired or reviewed before taking further legislative action.

To this end, Hon. Oke directed that the NDDC management and other stakeholders should appear on Monday by 11 am for further scrutiny to issues raised in the audit queries.


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