Alleged irregular contract: Senate to investigate NPA

The Senate has commenced investigation into alleged irregularities in award of contract by the Nigerian Ports Authority (NPA).

The contract which was awarded in March 2012 with 14 months completion period was to mitigate shore erosion at Akipelai, Ayakoro and Otuoke in Bayelsa State.

The Senate Public Accounts Committee was, however, peeved that about N4.2 billion had been paid which represents 56.61 per cent of the contract sum to the contractor while the level of work fell short of the sum disbursed.

The Senate Committee led by Senator Matthew Urhoghide upheld the 2017 Auditor General’s report which discovered  that contractor was paid more than the work executed by N344 million.

The Auditor’s General report also revealed that the sum of N19.5 million was paid for Toyota Hilux Double cabin petrol engine but with no evidence  that the vehicles were purchased.

In another startling revelation, the sum of N128 million provided for insurance against damages to persons and properties, was certified and paid but with no evidence that any insurance was undertaken.

The query read in part: “A contract for Shore Erosion Control Works at Akipelai, Ayakoro and Otuoke towns in Bayelsa State was awarded at a contract sum of N7,503,344,599.00, vide award letter Ref. No.: HQ/GME/CP/CON/R.16/067 dated March 22, 2012, with 14 months’ completion period.

“As of November 11, 2015, four payment certificates and an advance payment totalling N4,247,938,353.26 representing 56.61 per cent 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:  Mobilisation fee of N1,125,501,659.85, paid to the contractor, was supported by a conditional bank guarantee from Zenith Bank Plc. with a validity period of 365 days which expired on March 2, 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 four years after expiration of the bank guarantee, the contractor fails to renew it and the balance of unrecovered advance payment stood at N539,452,959.95.

“The sum of N13,500,000.00 was made for annual running cost of the project vehicles, in which N6,750,000.00 was certified and paid to the contractor, but there was no evidence to show what the amount was used for.

“The sum of N11,250,000 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 utilised nor the beneficiaries involved. N12,500,000.00 provided for community relations, was certified and paid vide Certificate No. 3 with No supporting documents to validate the payment.

“N128,000,000.00 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.

“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.”

NPA is expected to appear before the committee to make oral presentation of the response to the query.

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