The Tragedy of Abandoned Projects – by: Nasir Ahmad El-Rufai

Published:31 Aug, 2012

The Tragedy of Abandoned Projects  – by: Nasir Ahmad El-Rufai
Eleven thousand, eight hundred and eighty-six (11,886) abandoned projects that will cost an estimated N7.78 trillion to complete! These alarming figures are from the report of the Presidential Projects Assessment Committee (PPAC) set up in March 2011, by President Goodluck Jonathan to look into cases of abandoned federal government projects. If the government does not start any new projects, it will take more than five years budgeting about N1.5 trillion annually to complete them all – and that is assuming no cost-over runs or delays!

Ordinarily, these figures should compel the government to accelerate the completion of all ongoing projects, or at least focus on high priority ones. Unfortunately, this has not been the case: Government would rather continue the weekly charade of awarding new contracts or re-awarding old ones at higher prices during its weekly Federal Executive Council (FEC) meetings.
As trillions of naira are being wasted in the name of public projects, it is important to understand issues like how projects are initiated, bid for, negotiated and awarded and why they get abandoned. Who and what are really responsible for abandoned projects? Are poor planning, haphazard procurement, and incompetent project management the key causes or is it financial mismanagement? In spite of mobilization fees already paid, why is nobody held accountable when projects are not completed? How far can the Bureau of Public Procurement or other agencies with requisite mandate go to address the root causes of abandoned projects?
There is a need to briefly examine how projects are initiated and contracts awarded. The first step ought to be conception of projects that fit within a scheme of national vision, strategy and development programs. As we have stated in this column, a 27-page “transformation agenda” tucked away in the website of National Planning Commission falls short of this. This “agenda” is largely inconsistent with the Federal Ministry of Finance medium term sector strategies and budgeting priorities for 2011 and 2012. Most projects are therefore conceived out of nowhere and lacking in internal coherence and consistency with other programs.
Next is to plan and design the project in detail. Assume a road is to be constructed between two locations, the rights-of-way must be surveyed, levels taken, alignment finalized, road designed, and detailed drawings, bills of quantities and other bidding documents prepared prior to inviting pre-qualified engineering contractors to submit competitive tenders. The design development process can take anything between some months to more than a year, while it takes a minimum of 5 months from advertising invitations for bids to presentation to the FEC or other approving authority. This suggests that design and procurement processes for any project ought to start at least a year or two before being budgeted for. This only happens in a few foresighted agencies (MDAs).
Typically, nothing happens until the budget is passed and cash backed, then the implementing MDA begins the fire brigade work of compressing this timeline into a few weeks! Most MDAs wait until projects are included in budget or the budget passed before they start project surveys or design or the procurement process. When an MDA spends at least 5 months on procurement, how much time does the contractor have to execute the project and draw down the funds before the financial year runs out?  This becomes a big issue as MDAs are required by law to return all unspent funds to the treasury by the year end.
To understand why projects get abandoned, we must also understand the pervasive lack of continuation in policies as occupiers of political offices change. Whether it is long term development plans or contracts for critical infrastructure, the repeated practice in Nigeria is that once new people are in office, policies or programs of the previous administration are abandoned. This unwillingness to ensure policy continuity is the root cause of nepotism, corruption and impunity, as officials often re-award such contracts to cronies and generous campaign donors at inflated prices.
In this regard, the “democracies” have not fared better than the military in policy consistency. From Obasanjo’s NEEDS, to Yar’Adua’s Seven-Point agenda, and now, Jonathan’s Transformation Agenda – there has been continuity of policy inconsistency within the same ruling party – and turning projects that would have ordinarily benefited the populace into drain pipes. Critical examples are the N52m Zobe dam in Katsina, commissioned in 1983 by the Shagari regime; not only has several times the original amount been spent on the project, it has not pumped up a single liter of water. And the Ajaokuta Steel Complex which has gulped about N675bn, but still not produced much steel.

When projects are abandoned, the usual reason given is lack of funds, though often it is the pre-contract mishaps already alluded to, and project management deficits that are the fundamental causes. How can funding constraints be blamed for project failures? Should one not wonder why a project is approved in the absence of adequate funds? In fact, section 4 (2) (b) of the Public Procurement Act 2007, states plainly that all procurement shall be ‘based only on procurement plans supported by prior budgetary appropriations; and no procurement proceedings shall be formalized until the procuring entity has ensured that funds are available to meet the obligations and has obtained a “Certificate of ‘No Objection’ to Contract Award” from the Bureau’. Simply put, the law requires that no contract should be awarded if funds are not available for it from the onset!
It is intuitive that abandoned projects fuel corruption and reduce public confidence in governance. The excuse of inadequate or delayed funding may sometimes be contrived.  Such an inference could be drawn as abandoned projects are more often than not re-awarded at unjustifiably over-bloated sums. The increased costs are subsequently justified by blaming inflation, exchange rates, labour and materials cost increases amongst others.
If we intend to check the abnormality of abandoned projects, the relevant laws have to be strictly adhered to.  Section 63 (1) of the Public Procurement Act which states thus: ‘In addition to any other regulations as may be prescribed by the Bureau, a mobilization fee of no more than 15% for local suppliers and contractors and 10% for foreign suppliers and contractors may be paid to a supplier or contractor …’ must be firmly applied.  According to the PPAC, it is not uncommon for contractors to be paid mobilization fees in excess of 50% of the contract sum, often in apparent violation of the law.

While the Executive arm of government is largely to be blamed for abandoned projects, it is not alone. The National Assembly (NASS) is liable as well by unlawfully and unconstitutionally inserting new, unplanned projects into Appropriation Bills expecting them to be implemented. The NASS has joined the executive branch in ignoring the funding needs of existing projects to completion and commissioning. Take the Zobe dam mentioned; does the representative of that constituency not have the responsibility to pursue and ensure the strict completion of projects in his constituency?  If the focus of the government is on development and service to the people, why should officials seek approval for new projects when unfinished ones do not enjoy adequate funding and sound project management?

The Public Procurement Act 2007 established the Bureau of Public Procurement (BPP) with the National Council on Public Procurement (NCPP), as the regulatory authorities saddled with the oversight functions of monitoring procurement and implementation of federal projects across the country.  These statutory functions have been hampered by lots of challenges, including the late passage of the annual Appropriation Acts by NASS and abandonment of the procurement processes by the relevant MDAs if favored bidders turn out to be unsuccessful.

If properly sustained, the Due Process and Certification Mechanism started by the Budget Monitoring and Price Intelligence Unit under Oby Ezekwesili, would have been one of the many benefits of the legislation. This has however not been the case because of policy discontinuities and the cravings of politicians to have unfettered discretion in awarding contracts.

The Federal Government needs to, as a matter of urgency, comply with the provisions of the Public Procurement Act. The government must curb the temptations or pressures to embark on new projects when so many remain uncompleted or abandoned. Desirable projects must be continued irrespective of whichever administration initiated them. The NCPP, which is yet to be constituted, should be urgently inaugurated to superintend the activities of the BPP, as opposed to the current scenario where the FEC usurps the Council’s statutory functions.

As you read this, the Federal Ministry of Finance recently announced the release of N300 billion for capital projects for the third quarter of 2012, bringing the total release for capital projects so far this year to N704 billion out of nearly N1.5 trillion for the year. Most citizens will not feel the impact of this amount because the planning, procurement and project management processes are still fraught with nepotism, corruption and impunity that many projects may end up on the abandoned projects list – after billions have been paid as fungible mobilization advances. Our nation must do better. We must demand that our leaders do better!

Nasir Ahmad El-Rufai

Friday August 31st 2012

 

  • @engranayo

    Sincerely i weep as i read this, i really wonder if our leaders re human beings or Aliens sent to ruin our future. How can sane men n women allow such decadence to occur. Sometimes i can’t comprehend y our leaders indulge in corruption. #GodsaveNigeria

Related Posts

Recent Posts

End of Boko Haram in sight, Buhari assures international community

President Muhammadu Buhari on Tuesday in Dakar, Senegal, assured the international community that the end of Boko Haram terrorists was in sight. The President gave the assurance at the meeting of a panel of heads of states at the 3rd Dakar International Forum on Peace and Security in Africa. In a statement issued by his Senior Special Assistant on Media and Publicity, Garba Shehu, on Tuesday in Abuja, the President also assured the international community that the security situation in Nigeria had...

FLASH: FG sends bill seeking establishment of special anti-corruption courts to NASS

The Federal Government have sent to the National Assembly, a bill seeking the establishment of a special anti-corruption court to try serious crimes, including corruption cases.   The Special Crimes Bill 2016 was drafted by the Prof. Itse Sagay-led Presidential Advisory Committee Against Corruption.   The proposed court will exclusively handle corruption cases and other cases including narcotic, human trafficking, kidnapping, cybercrime, money laundering and other related offences.   Details of this bill and more will be passed on as it unfolds...

Super Falcons’ defender undergoes surgery.

Super Falcons defender, Onome Ebi, has undergone a successful surgery on her broken arm suffered during the just concluded Africa Women’s Cup of Nations in Cameroon.   The surgery was conducted on Tuesday at the National Hospital in Abuja.   Ebi, who is one of the veterans in the Super Falcons team that won a record eight African title last weekend, gave glory to God for the successful operation carried out on her.

Lawyers disagree with Kaduna govt. labelling Shiite IMN “insurgent group”

Nigerian lawyers have expressed divergent views on the legality of the action by the Kaduna State government designating the Shiite group, IMN, an “insurgent group.” While one of the lawyers who spoke in interviews with PREMIUM TIMES said the declaration was constitutional, others said it was not. The Kaduna State government in a White Paper released on Monday said “for all intent and purpose, the IMN is an insurgent group and ought to be treated as such.” The government also vowed to...

After UN report, 12 Osun communities renounce female circumcision

Efforts at eradicating the female genital mutilation, FGM, in Osun received a boost on Tuesday as 12 communities across four local governments declared their intentions to completely stop the practice. The declaration was made at the Female Mutilation Abandonment Declaration Ceremony organised by the Shericare Foundation, SCARF, an initiative of the wife of the governor, Sherifat Aregbesola. The communities that declared against FMG include Eko Ende, Eko Ajala, Iba, Asa, Iwo Oke, Ajagunlase, Alapata, Owode, Araromi in Ifelodun, Olaoluwa, Ede North and Orolu...

FUNERALS: Throwing a Lavish Party for the Dead, By Okey Ndibe

Regardless of the festering economic crisis in the country, regardless of the hordes of unemployed youngsters in the country, regardless of the thinning hope and burgeoning despair in the land—some people have figured that the most sensible thing to do is stage contests for the most gaudy, expensive and spectacular funeral. I have said this before: one of the hardest tasks is to predict how Nigerians would react in any given situation. We are a perplexing bunch, able to defy...

Husband chops off his own penis after his wife wouldn’t have sex with him.

A sexually frustrated husband, who claims his wife had not slept with him in a decade, has taken matters into his own hands in a bizarre manner. Ghasi Ram, 37, from India, cut off his own penis after losing his cool. He had come home drunk and started pestering his wife Manjhri Devi, 34, for sex.

There Are No Indigenes In Kaduna- El Rufai

The Governor of Kaduna State, Mallam Nasir el-Rufai has retweeted a tweet that quoted him as saying Kaduna state does not have indigenes. The post which was made by Bello El-Rufai which he attributed to the Governor reads: "We have no indigenes or settlers in Kaduna. Anyone that adds to our development is a citizen.  "Indigenes" don't like it." https://twitter.com/B_ELRUFAI/status/806156246898319360?ref_src=twsrc%5Etfw Credit: dailytrust

FG Secures EU’s Commitment on Rebuilding of North East, Niger Delta

The European Union (EU) on Monday pledged its support for the ongoing efforts of the Federal Government to rebuild some parts of the North East and Niger Delta regions by earmarking 20 million Euros for the reconstruction of markets and warehouses in Borno and Delta States. The EU Ambassador to Nigeria, Mr. Michael Arrion, who gave the pledge during a visit to the Minister of Finance, Mrs. Kemi Adeosun in her office, said the funds would...

Two Arraigned Over False Information To Police

Two accused persons, Patrick  Onomhante -54, and Dickson Ugoche – 52, have been arraigned before a Lagos State Magistrate Court sitting in Ikeja for allegedly giving false information to the police. They appeared before  Magistrate B. O.Osunsanmi  on a three-count charge of  conspiracy, false accusation,  false statement to a public officer and given false information to the police . The accused were docked for allegedly making false accusation against, Paul Njoku, who was charged with...

Senate Grills NCC, Telecom Operator Over Data Price Hike

The Nigeria Communications Commission (NCC) Tuesday said that it intervened with an interim price floor for data services to avert a looming price war in the telecommunications sector. The explanation of the NCC is coming even as the Minister of Communications, Mr. Adebayo Shittu, asked Nigerians to face reality. The regulatory commission said that it feared that the price war could eventually lead to a monopoly in the telecom industry that would force small operators...

Aisha Buhari, Magu To Kick-off Women Against Corruption Campaign

The Economic and Financial Crimes Commission, EFCC, will tomorrow,  flag off the Nigerian Women Against Corruption, WAC, project, at the International Conference Center, Abuja with the aim of engaging women across the country in a nationwide sustainable fight against corruption. According to the acting chairman of the EFCC, Ibrahim Magu, the epoch-making event, which is in collaboration with the office of the wife of the President would be flagged...

Mugabe Appeals For Calm Amid Economic Crisis

Zimbabwe President Robert Mugabe has appealed for calm as his government battles to contain a debilitating economic crisis. The 92-year-old president appeared frail but jovial, struggling with his lines a bit as he delivered a 30-minute State of the Nation address on Tuesday. He praised the country's security forces for maintaining order, although critics accuse them of using violence to stifle dissent. This once prosperous but now economically struggling southern...

Police Arrest Man Who Supplies Herdsmen Arms

The police in Enugu have arrested a man who allegedly supplies AK-47 rifle to herdsmen. The suspect, one Alhaji Samaila Garuba, alias Bakassi, who is from Shagari village in Sokoto State, was arrested in the 9th Mile area of Enugu on Tuesday morning. Spokesman for the Enugu State Police Command, Mr. Ebere Amaraizu, who disclosed this, said a herdsman, Ibrahim Adamu, who was arrested with an AK-47 in the Udi area of Enugu on August...

15 Year Old Charged with Beheading His Classmate in Gruesome Murder

A 15-year-old in Lawrence, Massachusetts has been arrested and charged for the murder of his high school classmate, whose decapitated body was found by the Merrimack River north of Boston last week. On Saturday, Mathew Borges was charged with murdering and decapitating 16-year-old Lee Manuel Viloria-Paulino, who first went missing on Nov. 18 after he left his grandmother's house but never returned home. "It's shocking, it's heartbreaking," Lawrence Police Chief James Fitzpatrick...

KKK Holds Parade To Celebrate Trump’s Win

The Ku Klux Klan held a pathetic parade to celebrate the election of Donald Trump in North Carolina on Saturday. The hate group's "parade" was originally to be held in Pelham but was moved one county over to Roxboro because of protestors. The Burlington Times-News reports that the KKK rally had a full police escort. State troopers blocked intersections while 30 vehicles drove around the town. The...

Dangote Sacks 109 Workers

The Dangote Group has dismissed 109 workers at Obajana Cement Company in Kogi State, after being found guilty of various offences, Abdulahi Magaji has said. Mr. Magaji, the coordinator of the company’s Patrol Team, announced this to journalists on Tuesday at the Obajana premises of the company. He said that the dismissed workers were among the 244 suspects arrested between May and November. According to him, they include erring drivers, owners of illegal haulage,...

Stop Making Expensive Demands from me, Buhari tells Nigerians

President Muhammadu Buhari on Tuesday asked Nigerian elite to stop making what he called expensive demands from his administration because things would no longer be done in the old way. He warned them to stop insisting that things should be done the old way which impoverished the nation. The President spoke during a meeting he had with a group of Nigerians in the Diaspora, on the margins of the 3rd Dakar International Forum on Peace and Security in...

Moremi Ojudu, Hope Betrayed And The Fury Of History By Rotimi Opeyeoluwa

The Holy Book claims that it is a dangerous thing for a human conscience to become seared. In such an occurrence, the conscience which is supposed to be an inbuilt moral-compass to help navigate between good and evil is compromised. When the human conscience is seared then all evil is tolerable and good is assaulted by unreasoning and that is what is currently playing out in Nigeria of today. During the last circle of electioneering in Nigeria and within...

2019: God Will Give PDP 2nd Chance- Bode George

Former deputy national chairman of the Peoples Democratic Party (PDP), Chief Olabode George has expressed hope that God and Nigerians will give the erstwhile ruling party another opportunity to rule the country, again, in 2019. George said this, yesterday, at his Ikoyi, Lagos office, when he hosted the South-West zonal executive of the party, led by Eddy Olafeso, which paid him a working visit. George premised his declaration on what he called the poor performance of the All Progressives...

Allegations Of Corruption In The Justice Delivery Sector: Implications For Rule Of Law & Democracy By Femi Falana

Introduction  For the past three decades, I have been involved in the struggle against human rights violations, corrupt practices and abuse of powers by certain principalities in Enugu State. In the 1980s I was here to defend the late Chima Ubani and other leaders of the student union of the University of Nigeria, Nsukka when they were expelled on grounds of political extremism. I also defended them when they were later charged before a Special Military Tribunal which sat at Enugu. In the 1990s I was equally here to launch...