Senate Investigates $2bn Rail Line Concession to GE

Probes N9bn CCB project, asks FG to declare emergency on unemployment
Omololu Ogunmade in Abuja

The Senate yesterday mandated its Committees on Privatisation, Land Transport, Finance, Anti-Corruption and Financial Crimes, Special Duties, Trade and Investment and Judiciary to investigate the procedure adopted in the engagement of General Electric (GE) for the concession of Lagos-Kano and Port Harcourt-Maiduguri rail lines by the federal government.

This resolution was the fallout of a motion by Senator Bassey Akpan (Akwa Ibom North-east) during which he alleged that the Ministry of Transport violated the provisions of Public Enterprises (Privatisation and Commercialisation Act) 1999 by unilaterally engaging the services of GE for the concessioning of the Western (Lagos -Kano) and East (Port Harcourt-Maiduguri) rail lines.

Akpan, in his motion, cited an interview granted the CNBC in June this year, where he announced the concession to GE of Western and Eastern rail lines – Lagos to Kano and Port Harcourt to Maiduguri respectively – worth around $2 billion.

He quoted Amaechi as saying “GE is already in; we are trying to get the government agencies to allow us negotiate with GE, ‘Amaechi said: ‘the company is going to bring in over $2 billion in the Nigerian railway sector in which they are going to revive the Lagos-Kano narrow gauge and revive the Port Harcourt-Maiduguri narrow gauge by private investment.

“Due to lack of funds, concessioning appears the method of choice of the President Muhammadu Buhari administration for major projects. Apart from the rail lines, the government has also announced its decision to concession Nigeria’s four major international airports.”

According to him, it is the responsibility of the steering committee and technical committees of the National Privatisation Council (NPC) inaugurated by Vice President Yemi Osinbajo in August this year to negotiate with potential bidders for the concession.

He therefore queried the rationale behind the engagement of GE in June 2016 by the Transport Ministry, two months before the inauguration of the committee by the vice president and called for the probe of the engagement.

Also yesterday, the upper legislative chamber mandated its Committees on Federal Capital Territory (FCT) and Ethics, Privileges and Public Petitions to begin investigation into an allegation that the Code of Conduct Bureau (CCB) abandoned an ongoing N8 billion project for the purchase of a N9 billion building.

Moving a motion on the floor of the Senate yesterday, Senator Dino Melaye (Kogi West) alleged that whereas an N8 billion contract for the construction of CCB permanent site had been awarded and N1.4 billion of the sum had already been spent, the CCB suddenly dumped the project and proceeded to purchase a nine storey building.

He said the action was antithetical to the duties of CCB whose commitment, he said, was to guard against corruption and watch over public finance.

Melaye said: “CCB, after spending over N1 billion on the construction of the office complex headquarters with complete approval by the Federal Capital Development Authority (FCDA) with design by the Federal Capital Territory Administration (FCTA) and supervision ongoing by the FCT, has opted to purchase a completed nine storey building located in the Central Business District of Abuja just as the abandoned one is also located in the same business district.

“The Senate observes that the Bureau, apart from the ongoing construction project of the headquarters, was evaluated and awarded in the sum of N3,509,327,405, out of which a total sum of N1,407,263,884, so far, representing 16 per cent of the contract sum, has been paid while the cumulative job done as at to date is estimated at 10 per cent… CCB in the whole exercise is not expected of an institution that is supposed to protect and watch over the finance of the society by checking corrupt practices in the Nigeria public service.

“The Senate hereby accordingly resolves that the Committees on Federal Capital Territory (FCT), Ethics and Privileges and Public Petitions, should carry out a holistic investigation into the matter and report back to the Senate.”

Responding, Deputy Senate President, Ike Ekweremadu, who presided over the plenary, said the contention was not the right of the CCB to occupy a befitting office but whether an ongoing project was suddenly abandoned for a new one.

“As I said earlier, since it is still an allegation, if we subject this to debate, it may be prejudicing the outcome of the investigation. This Senate recognises the absolute need for the bureau to have a befitting office. I think the issue now is whether there is an ongoing project being abandoned in preference to purchasing an existing one. We are here to ensure that public finances are appropriately spent,” he said.

Also yesterday, the Senate bemoaned the increasing spate of unemployment in Nigeria and called on the federal government to declare a state of emergency on unemployment “with a view to confronting the challenge frontally and radically.”

The upper chamber also summoned the Minister of Labour and Productivity to explain what the government is doing to address the rising spate of unemployment.
It also resolved to organise a one-day retreat to deliberate on the state of unemployment in the country, its causes and effects.

In a motion, Senator Duro Faseyi (Ekiti North) expressed concern over what he described as “scandalous and incredible level of unemployment” as revealed by 13.3 per cent double digit released by the National Bureau of Statistics (NBS).

Faseyi who described it as the worst unemployment situation the country had ever faced, said it was alarming that the number of unemployed Nigerians rose from 24.4 million in the first quarter of 2016 to 26.06 million in the second quarter.

Observing that the economic recession confronting the country would only aggravate the unemployment rate, Faseyi said the trend had created social tension and crisis of monumental proportion as young graduates now engage in crimes such as kidnapping, abduction, armed robbery, insurgency and other criminal acts for survival.

He pointed out that the existence of 370,000 policemen to 170 million Nigerians and nine military personnel to 10,000 citizens, provides the federal government with the window of opportunities to enlist young graduates into the nation’s security outfits and consequently reduce unemployment.

The Senate also lamented the congestion of the Nigerian prisons and advised the federal government to make deliberate efforts to decongest the prison system. The motion was moved by Senator Sam Anyanwu (Imo East).