Umahi, BudgIT Differ over N8.6bn Payment to Microfinance Bank for Road Contracts, Others

*State govs to sign off on federal roads before clearance

Emmanuel Addeh in Abuja

The Minister of Works, Senator David Umahi and the Coordinators of Tracka, BudgIT’s service delivery promotion platform, at the weekend disagreed over the payment of N8.6 billion to FIMS Microfinance Bank for some projects  by the ministry.

Tracka, through its Head, Ayomide Ladipo, said the payments were made between June and December 2023 for 62 projects, including the construction of road across the country.

It listed some of the projects, as payment of N1.4 billion in September 2023 for the construction of Yaba-Yangoje Road in Abuja; the payment of N1.2 billion in October 2023 for the rehabilitation of a 2km road from Oriawo-Boroboro-Oke, Oyo state and the payment of N1.2 billion for the rehabilitation of Kosobo-awe junction road in Oyo East.

BudgIT’s Tracka also mentioned the payment of N1.2 billion between August and November 2023 for the rehabilitation of Ejule-Otukpo Road in Benue State, among others.

It argued that as a financial institution, the award of road construction contracts amongst others to the company was a violation of the Public Procurement Act, 2007.

Specifically, it stated that s.16 (6) (a) (i), (iii), and (iv) states that: “All bidders in addition to requirements contained in any solicitation documents shall: (a) possess the necessary: Professional and technical qualifications to carry out particular procurements; financial capability; equipment and other relevant infrastructure; and shall have adequate personnel to perform the obligations of the procurement contracts.

“We request that the Honourable Minister of Works, David Umahi, tenders an explanation to Nigerians on how these repeated violations and infractions occurred in his office.

“In addition, we call on the Bureau of Public Procurement (BPP) to review the transactions for violating the Public Procurement Act 2007 and serve appropriate sanctions for breaches where identified,” the organisation said.

BudgIT’s Country Director, Gabriel Okeowo, described it as a gross mismanagement of public funds and blatant disregard for public procurement laws, emphasising that public funds should be treated with the highest level of caution and a sense of responsibility to the collective interest of Nigeria and its people.

He called on the anti-graft agencies—the Independent Corrupt Practices Commission (ICPC) and the Economic and Financial Crimes Commission (EFCC) to question and probe the payments and prosecute the erring officers.

But a THISDAY review of the document showed that BudgIT may have reasoned that the projects were awarded directly to the microfinance bank who built the roads as government contactors, prompting the reference to the extant procurement law which it said had been breached.

However, the minister’s response may have also been based on the understanding that the pro-transparency organisation was accusing it of paying monies through a microfinance bank, which reflected in the statement issued in his defence.

Umahi in the statement by his Special Adviser, Media, Uchenna Orji,  debunked the claim that funds for construction of roads were fraudulently paid into the microfinance bank, contrary to extant regulations.

The minister said the statement at the weekend was extracted from his interview with some journalists in Rivers state, during the inspection of  the Enugu-Port Harcourt  dual carriageway, being reconstructed  by Arab Contractors  Ltd.

Describing it as an “erroneous claim”,  the minister stated that in June 2023, he was still in the Senate. “So, if they are correct, it means the contracts would have been awarded while I was still a governor, so (I was) not a minister,” he added.

“When a contractor has done his or her work, the money becomes his money. He can say pay it to any bank of his choice,” the minister stated.

Umahi described as “very mischievous” the claim by the organisation stating that they should have investigated whether the job was done.

 “That is the only right they have. But they don’t have the right to say where a contractor will say his money will be paid,” he added.

He submitted therefore that: “Whether it’s paid into a microfinance bank or ‘macrofinance’ bank, what is paramount to establish if the funds were rightly paid for good work done.”

The minister averred that it was an attempt to distract his commitment to delivering on President Bola Tinubu’s  agenda for road development in Nigeria.
“And so, it’s just a distraction. And then, some of the bank contractors are using them to fight back. But I refuse to be distracted,” he restated.
On his efforts to ensure quality delivery of road projects through partnership with the states, Umahi  stated that when projects are completed in their domains, governors should also be part of the team to certify that they are okay.

“It’s our policy that the state governors, through their appointed officials, must mark off any project, especially the emergency palliative projects.

 “When a contractor has completed a job, no matter how big it is, my advice is for the state governor to come to the site and look at it and then mark off the job before he gets to office for payment. Where this procedure is not done, I will not sign any generated certificate,” he stressed.