PHCN’s hidden N14.7bn

NIGERIANS must by now be exasperated by stories of mindless robberies, corruption and fraud in the Ministries, Departments and Agencies (MDAs) of the Federal Government. And they would be quite justified in their reaction because the stories are benumbing and unceasing, exposing the rotten underbelly of governance in the country. Just last week, the Senate Committee on Public Accounts commenced investigation into the status of  the ₦14.7bn privatisation proceeds of the defunct Power Holding Company of Nigeria (PHCN) allegedly hidden in commercial banks by the Bureau of Public Enterprise (BPE).

The Senate committee’s action was consequent upon the report by the Acting Auditor-General of the Federation, Adolphus Aghughu, presented to the Clerk to the National Assembly, Ojo Amos, on September 15 last year. The Auditor-General said in part: “Audit verification and reconciliation revealed that the sum of N14,720,396,432.43, being proceeds from the privatisation exercise of the Power Holding Company of Nigeria, was reported in the bureau’s trial balance to be in commercial bank accounts as of 31st December 2016. Whereas the privatisation of the PHCN was concluded in 2013, the proceeds are yet to be remitted to the Central Bank of Nigeria Privatisation Proceeds Accounts. The issue has been communicated to the Bureau via letter reference No. OAuGF/RESAD/05/2016/07 dated 19th April, 2018 and no response has been received. Unauthorised funds kept in commercial banks may be diverted for other purposes, thereby leading to loss of revenue available for government programmes.” Aghughu therefore instructed the Director-General of the BPE to recover the said sum, remit it to the appropriate account, and forward evidence of remittance to his office for audit confirmation.

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Responding to the report, the BPE was quoted as offering the following line of defence: “Two separate sums of N3.231,984.73 and N18.199,520.87 are unaudited bank balances that were actually no longer in existence as of the date of the audited financial statements. The correct balance in a bank as of 31/12/16 was NIL as the bank had transferred a swelled balance of $34.1 million to the CBN’s domiciliary account. The bank had initially been unable to make the transfer in September 2015 as required under the TSA policy, owing to the inexistence of designated USD Treasury Single Account for dollar balances.  The balance in a bank as at 31/12/2016 was only $36,053.55 following the transfer of $65,088,198.53. The residual balance remained until 18/9/17 due to the inability of the bank to remit as required under the TSA policy owing to initial unavailability of designated TSA for USD balances as required under the then newly introduced policy.”

To say the least, it is galling that public funds which ought to have been remitted through the statutorily designated channels has spawned the latest controversy. To all intents and purposes, the Auditor-General of the Federation has performed the demands of his office. It is now left to the Senate committee to subject the defence offered by the BPE to scrutiny and come up with a report as soon as possible. Without prejudice to the outcome of its investigation, we find it troubling that due process has been wilfully trampled upon in this case. Going by the Auditor-General’s account, the issue of the missing fund was communicated to the BPE via a letter dated 19th April, 2018 but no response was received. If that is the case, then it raises fundamental questions about how the MDAs operate, and whether they set any store by the public service rules. The fact that a query on such a humonguous sum went unreplied shows that the country is afflicted with a system where everyone does whatever they like regardless of the cost to the society.

We recall that two years ago, the Ondo State government uncovered the sum of N4.3bn that had been kept in a secret account since the Olusegun Agagu administration. According to reports, the money was lodged in a third generation bank without due process. The account was uncovered by the state’s Commissioner for Finance, Mr. Wale Akinterinwa. Thus, money that could have been used to better the lot of Ondo people sat pretty in a bank account for over a decade. Apparently, the brains behind the account successfully hid it from the Olusegun Mimiko administration, which succeeded the Agagu government.  Usually, civil servants, working with corrupt politicians, are involved in such monumental frauds. It is certainly unconscionable that banks would hide government money, but would they be able to do so in a clime governed by due process and swift recompense for infractions?

We commend the Senate for taking up the PHCN issue and urge it to do a thorough job. Nigerians deserve to know the full details of  the transaction.