Why Federal Government Must Release Withheld NDDC Funds Now

Tekena Amieyeofori

The Niger Delta Development Commission (NDDC) has been  on the spotlight since President Muhammadu Buhari ordered a forensic audit of its activities in October 2019. Coming on the heels of the Steve Orosanye Report of 2011, the probe ordered by President Buhari to look into the books of the NDDC (from its inception in 2001 to 2019) goes down in history as the most wide-ranging investigation of alleged malfeasance in the system. Expectedly, it was greeted with a wide applause by several groups looking forward to an administrative revamp of an Augean Stable that the NDDC had epitomised in many ways.

  Final report of the NDDC forensic audit was submitted to the presidency in September 2021. Highlights of the report shows that executed projects and programmes were not commensurate with over N6 trillion budgeted for the NDDC from 2001 to 2019. Additionally, over 13,000 projects awarded by the commission had been abandoned over the years. Undoubtedly, the NDDC forensic audit report lends credence to findings in previous reports drawing attention to the fact that the commission was to a large extent, incapacitated by its poor project management culture. This is particularly evident in the award of contracts without carrying out needs assessment of projects to determine how well they impacted communities. The unsavoury outcome of the commission’s poor project management culture had been duplication and abandonment of projects in a region that had grappled with crumbling infrastructure for many decades

 In fairness to the NDDC, it had made significant progress with infrastructure development across the length and breadth of the Niger Delta region to justify its establishment as an intervention agency. One of its legacy projects worthy of mention is the Nembe-Ogbia road. For the first time, the highly celebrated Nembe-Ogbia road construction project has linked Ogbia kingdom to Nembe Kingdom which is located on the Atlantic. Today, many isolated coastal communities in Bayelsa East Senatorial District are directly accessible by road. It is important to note that the NDDC has in the last 21 years of its existence replicated the Nembe-Ogbia road in other parts of the Niger Delta region. As a few commentators rightly point out, the biggest problem confronting the commission has been inadequate funding.

Part five of the NDDC Establishment Act (2000) clearly spells out sources of statutory funds to which the NDDC is entitled to enable it carry out its intervention in blighted communities across the Niger Delta region. Under the Act, 15 per cent of monthly allocations due states comprising the Niger Delta is to be deducted from source to fund the NDDC. The Act also provides that three per cent of total annual budgets of oil companies (foreign and local) operating in the region be deployed to fund the commission.

To further strengthen the financial position of the NDDC, the Act provides that 50 per cent of ecological funds due oil-producing states be domiciled in the account of the intervention agency. These provisions are made to ensure availability of adequate funds required to intervene in the plight of a region with a difficult terrain that makes infrastructure development an onerous task to embark upon. Sadly, the Federal Government and its development partners are found wanting in funding the NDDC required by the law. In July 2019, the Paris Trust Fund ( the firm responsible for the collection of unremitted statutory dues owed the NDDC disclosed that most of the oil companies had been defaulting in the payment of three per cent of the annual budgets to fund the NDDC for roughly five years in the period under review, the Federal Government had equally failed to remit to the NDDC its own statutory contribution of 15% of total monthly allocations due states of the Niger Delta from the federation account as well as 50% of ecological funds accruing to oil-producing states.

In 2019, accumulated remittances owed the NDDC stood at about N1.2 trillion. By August 2021, former Minister of Niger Delta Affairs, Senator Godswill Akpabio disclosed that indebtedness to the NDDC  had risen to over N3 trillion. The rather unjustifiable indebtedness to the NDDC is regardless of the fact that it had financial commitments in excess of N3 trillion as Senator Akpabio observed some two years ago. This is confirmed in the final report of the NDDC forensic audit which puts its indebtedness to contractors at over three trillion Naira.

  While the NDDC forensic audit was ongoing, the Economic and Financial Crimes Commission (EFCC) in 2020 assumed the role of collecting statutory financial contributions made by oil companies on behalf of the commission. Not a few concerned Niger Deltans berated the EFCC for violating the NDDC establishment Act (2000) which in section 14 (2) empowers the commission to receive and manage its statutory funds to ensure even and rapid development in the Niger Delta region. However, other groups saw the need to keep huge funds amounting to trillions of Naira out of the reach of successive interim administrations appointed to run the affairs of the NDDC.

In their reckoning, the EFCC would release the withheld funds to the NDDC as soon as a legally constituted board was appointed. With the benefit of hindsight, it appears the EFCC did not assume the role of collecting statutory funds on behalf of the NDDC on account of financial mismanagement by successive interim administrations appointed to pilot its affairs in time past. It is troubling to note that four months after the new NDDC board was appointed, the EFCC is yet to release to the NDDC funds accruing from statutory contributions made by oil companies operating in the Niger Delta region. As things stand, the non-release of statutory funds due the NDDC is about to make a mockery of a forensic audit under taken to revamp the commission to begin to function properly as an intervention agency.

  Final report of the NDDC forensic audit shows that projects were abandoned as a result of the failure of contractors to mobilize to site after collecting mobilisation fees. There are also indications that most NDDC projects had been stalled due to non-payment of fees to other diligent contractors, some of whom had gone the extra mile to raise bank loans to facilitate their projects. Only recently, the NDDC had cause to terminate failed projects for which contractors were duly mobilised. Acting on the instructions of the presidency, the commission has directed erring contractors to refund monies collected for all unexecuted contracts through the Central Bank of Nigeria.

This is a commendable step taken to retrieve funds stolen by unpatriotic Nigerians whose greed had rendered the NDDC comatose, preventing the commission from carrying out its statutory mandate of effective and efficient service delivery to largely backward communities in the Niger Delta. However, it fails to address the problem of completing thousands of projects that had been stalled by the commission’s indebtedness to its diligent contractors.

 The Warri-Escravos road and the Port Harcourt-Okrika road and bridge construction projects are typical examples of NDDC projects that have been stalled due to inadequate funding. Others are too numerous to mention. For the time being the new NDDC board has devised a public-private-partnership policy to generate the required technical expertise and funds required to complete otherwise laudable projects that have been abandoned on account of inadequate funding.

The public-private-partnership approach to project financing is the current trend in governance globally. In spite of its many criticisms, it has worked perfectly well in the United Kingdom and other parts of today’s global community where the private sector deploys its technology and innovation to complement public sector incentives in executing projects on time and within available budgets. This does not preclude timely release of  statutory funds to the NDDC to enable it carry out a meaningful intervention in the Niger Delta region of Nigeria in line with its establishment act. In other words, the NDDC is in dire need of its own funds to complete thousands of projects that currently litter the Niger Delta region on account of inadequate funding.

It is important to point out, in the final analysis, that the government of President Buhari deserves commendation for taking the bull by its horns to order a forensic audit of NDDC activities over a period of 19 years. However, the challenge before the outgoing government had been a comprehensive implementation of the forensic audit report. In addition to prompt release of statutory funds to the NDDC, there is an urgent need for the incoming administration to put a final stop to the conventional practice of hiring and firing the NDDC board at will. All too often, successive boards of the NDDC have been appointed and dissolved through executive fiats, without considering the implications of such actions on the zoverall development of the Niger Delta region.This scenario calls for an immediate amendment to the NDDC Act to ensure that its administration and management are no longer at the whims and caprices of the presidency and other state actors.

 The NDDC remains the flagship of the Federal Government’s intervention initiatives in the Niger Delta. It is no surprise, therefore, that the commission has become a symbol of hope for the down-trodden in Nigeria’s oil belt. Given its huge significance to the socio-economic development of the Niger Delta region, it stands to reason that the NDDC must live up to its statutory mandate as an intervention agency. But this can only happen when the Federal Government and its development partners begin to see the need to fund the NDDC as required by law and stop the practice of relegating it to the background as an agency created for political patronage.

Tekena Amieyeofori, a journalist and Conflict Analyst writes from Port Harcourt.