Alleged irregular contract: Senate to investigate NPA

The Senate has commenced investigation into alleged irregularities in the 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 N4.2bn 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 the 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 ₦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: Mobilisation 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 per cent 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 per cent of 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.”

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

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Alleged irregular contract: Senate to investigate NPA

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