BEING A PRESENTATION BY THE HONOURABLE MINISTER OF NIGER DELTA AFFAIRS TO THE HOUSE COMMITTEE ON NDDC OVER ALLEGATION OF FINANCIAL MALFEASANCE AND OTHER ACTIVITIES IN THE NIGER DELTA DEVELOPMENT COMMISSION (NDDC) HELD AT THE MEETING ROOM 447, NEW BUILDING EXTENSION, HOUSE OF REPRESENTATIVES, NATIONAL ASSEMBLY COMPLEX, ABUJA ON MONDAY, 20TH JULY, 2020
PROTOCOLS
The Honourable Chairman and Members of the Committee, I am sincerely grateful for this opportunity to appear before you to personally respond to the issues raised in your letter Ref. No. NASS/9HR/CT/2020/VOL.1/039 dated 6th July, 2020 alleging malfeasance and other activities in the Niger Delta Development Commission (NDDC).
2.I want to appreciate the Honourable Members of the House of Representatives under the leadership of the Speaker, Rt. Hon. Femi Gbajabiamila and other Principal Officers. I sincerely appreciate the opportunity to interact with this Committee today as I recall some of the fond memories shared with a number of members during the 8th Legislative Session as a Senator of the Federal Republic of Nigeria, a Minority Leader in the opposition party of the PDP and a Principal Officer of the Nigeria Senate before I moved to join a President with impeccable record of integrity in the APC, His Excellency, President Muhammadu Buhari, GCFR.
3.To this day, I have endeavoured to discharge my responsibilities as the Minister in charge of the Ministry of Niger Delta Affairs together with my colleague, the Honourable Minister of State, Senator Tayo Alashodura, with the same zeal demonstrated by me a few years ago as Governor of Akwa Ibom State. The propelling force is to bequeath a legacy that future generations will be proud of. This philosophy has guided my stewardship in the Ministry and the oversight of its lone parastatal, the Niger Delta Development Commission (NDDC) which in the recent has been in the public space due to concern in certain quarters on the commencement of the forensic audit of the Commission as directed by Mr. President.
4.To situate in its proper context, the Governors of the 9 States of the Niger Delta Region at a meeting with Mr. President in October 20th 2019 requested and the President approved and directed the conduct of the forensic audit of the Niger Delta Development Commission (NDDC) from 2001 to 2019 fiscal years.
5.Prior to this directive for the conduct of the forensic audit, Mr. President has reconfirmed the following:
i. Delegation to the Honourable Minister, the powers and duties conferred on the President by Section 7(3) of the Niger Delta Development Commission (NDDC) Act;
ii. Confinement of the NDDC as a parastatal in the Ministry of Niger Delta Affairs, a decision taken since 2015;
iii. Suspension of the composition of a proposed Board for the NDDC in 2019 until the conclusion of the Forensic Audit exercise;
iiii. Constitution of a 3-Man Interim Management Committee, later expanded to a 5-man Interim Management Committee currently led by Professor Kemebradikumo Daniel Pondei as the Acting Managing Director, to oversee the affairs of the NDDC during the forensic audit exercise;
v. The estimated cost of the forensic audit exercise put at N2.5billion to be funded from the budget of the NDDC; and
vi. That the composition of a Board for the NDDC in 2019 be put on hold, pending the conclusion of the Forensic Audit exercise.
6.This Honourable Committee is adequately informed that a component part of the NDDC Budget comes from the annual national appropriation, as a single line Vote and of which the 2020 Appropriation Act signed into law by the President on Tuesday, December 17, 2019 and which went into force on January 1, 2020 provided the sum of N80.88billion for NDDC. In the 2019 Budget, a statutory transfer for the NDDC in the Federal Government of Nigeria Budget was put at N71,195,023,528.62. Earlier in October, 2019, the President had approved the funding of the Forensic Audit exercise by an estimated sum of N2.5billion to be sourced from the budget of the NDDC. The processes leading to the final award of contract for the Lead Consultant was completed in March 2020 when the two Houses of the National Assembly had passed the 2019 Budget of the NDDC.
7.On the passage of the 2019 statutory Appropriation as indicated above, the sum of N1,250,000.000.00 was provided for the forensic audit of the Commission on March 4 and 5, 2020 by the Senate and the House of Representatives respectively. However, the Clerk to the National Assembly conveyed a letter forwarding the passage of a budget of the NDDC for the 2020 fiscal year (copy of the said letter is attached as Annex I)
8.To kickstart the process for the Forensic Auditing exercise, the then Ag. Managing Director of the Niger Delta Development Commission, vide a letter dated December 6, 2019 (copy attached as Annex II) transmitted to the Bureau of Public Procurement prequalification, technical and financial documents of Messrs. Jake Riley Ltd as a Lead Consultant to recruit other Forensic Auditors for the Commission. The BPP reviewed the submission and vide its report Ref. No. BPP/DPR/SP/REPORT/2019/093 of January, 2020 (copy attached as Annex III) conveyed approval for the adoption of Direct Procurement method for the engagement of a Lead Forensic Consultant but declined to certify Messrs. Jake Riley Ltd because its submission was not responsive.
9.Thereafter, the NDDC vide letter Ref. No. NDDC/HQ/MD/BPP/2019/09 dated December 30, 2019 (copy attached as Annex IV) again transmitted to the BPP the prequalification, technical and financial documents of Messrs. Olumuyiwa Basiru & Co. for review and Certification of award of contract as Lead Forensic Audit Consultant at the cost of N335,601,562.50. The BPP reviewed the firm`s capacity and credentials and issued a Due Process Certificate of No Objection to Award, Ref. No. BPP/S.1/Vol.XV/19/108 dated January 08, 2020 (copy attached as Annex V) in favour of Messrs. Olumiuyiwa Basiru & Co. and its engagement as the Lead Consultant for the recruitment and supervision of Forensic Auditors and the coordination of the conduct of the forensic audit of the Niger Delta Development Commission (NDDC), at the total Consultancy Services Fee of N318,903,750.90 only.
10.The approval of the Federal Executive Council was subsequently obtained at the meeting of the Council held on 12th February, 2020 as certified above. However, the Ministry exercised restraint in finalizing the procurement process in view of Section 16(1)(b) of the PPA, 2007, which prohibits the finalization of a procurement process until the related funds are available, hence while the requisite processes were concluded, the related letter of award and contract agreement which marked the finalization of the procurement processes were not issued until the passage of the Budget of the NDDC on 4th and 5th March, 2020, by the Senate and House of Reps of the National Assembly. Extract of relevant page of the PPA, 2007 and the letter of award of the contract are attached as Annexes VI and VII respectively.
11.In line with its mandate to recruit field forensic auditors for the exercise, the Lead Forensic Auditor, through the Ministry of Niger Delta Affairs in the letter Ref. No. MNDA/PROC/NDDC/20/263/Vol.1/9 dated March 20, 2020 (attached as Annex VIII) sought and received a ‘No Objection’ Approval from the Bureau of Public Procurement (BPP) for the appointment of the field forensic auditors through Selective Tendering process. Subsequently, the Evaluation Report with the Technical and Financial Tenders were transmitted to the BPP for review and certification. The Bureau reviewed the procurement processes and certified the process and issued a Certificate of ‘No Objection’ to award Ref. No. BPP/S.1/Vol.XVI/20/084 dated June 29, 2020 (copy attached as Annex IX) for appointment of the nine (9) firms and companies reflected in the Report as field forensic auditors for the conduct of the Forensic Audit of the NDDC, at the cost of N817,033,002.48 inclusive of all taxes and VAT at 7.5% with a completion period of 6 months and directed that the remaining seven (7) project lots be re-procured.
12.With the imminence of the commencement of the active phase of the forensic audit of the NDDC (visitation to project sites State by State), the social and print media have been awashed with massive campaign of calumny against the Interim Management Committee of the Commission and the Ministry, even at very high quarters all in the effort to frustrate the conduct of the Forensic Audit. The Interim Management Committee alleged an attempt at arson on the Headquarters of the Niger Delta Development Commission to destroy records and frustrate the forensic audit exercise. The Commissioner of Police Rivers State Command was immediately notified and he came in person to beef up security at the Headquarters. Many staff were also caught attempting to cart away hundreds of files belonging to the Commission. The police was notified. The Interim Management Committee handed over 8,000 files to the Lead Forensic Auditor who in a letter advised that staff that held very senior position that have not been on leave in the last two years were advised to go on mandatory leave with full salaries and benefits on monthly basis until the forensic audit exercise is concluded. No permanent staff of the Commission was sacked as alleged in the print, electronic and social media. The action of the Interim Management Committee in sending on mandatory leave any official whose presence in his or her duty post is deemed capable of interfering with the audit process, as advised by the Lead Forensic Auditor is in line with best practices.
DOCUMENTS REQUESTED
13.Request to Bureau of Public Procurement (BPP) for Certificate of No Objection for the Lead Consultant and the response of BPP in that regard: The relevant letters are attached as Annexes II-V above.
14.Criteria used for the appointment of members of the Interim Management Committee (IMC): It is in exercise of the power conferred on the President by the following:
(i.) The Ministers’ Statutory Powers and Duties (Miscellaneous Provisions) Act at Chapter M14, Section 2 (Extract attached as Annex X) provides inter alia:
(1) “Subject to the provisions of this section, the President may, in any law enacted by the National Assembly or having effect as if it had been so enacted, by order make such modifications, whether by means of addition, substitution or deletion, as he may think fit for the purpose of:
(a) transferring to a Minister any of the powers and duties which are by such law directly or indirectly conferred or imposed on the President, or any public officer or which are conferred upon any other Minister; and
(b) making provisions consequential or incidental to any such transfer.
(2) An order made under this section may include directions (either general or in relation to any particular matter) for the carrying on and completion by the Minister to whom a power or duty is transferred, of anything commenced by the authority from whom it is transferred.
(4) A law which has been modified in accordance with an order made under this section shall be deemed for all purposes to have been amended in accordance with such modification, and the provisions of section 22 of the Interpretation Act (which relates to the reprinting of Acts and laws which have been amended) shall apply to any modification so effected as they do to additions, omissions, substitutions and amendments effected by an amending Act or law. [Cap. 123.].
(ii.) The “Administrative Guidelines Regulating the Relationship Between Parastatals / Government -Owned Companies and the Government” (extract attached as Annex XI) in paragraph 6 provides that “Government will ensure that there is always a Board for every parastatals that has a statutory provision for such a body. Where, however, a Board is dissolved and it is not immediately possible to reconstitute the Board, the President shall on the recommendation of the supervising Ministry constitute an Interim Board. Pending the reconstitution of such a Board, all matters which normally require the approval of the Board shall be referred by the Ministry to the President for approval”. The foregoing put in place the governance structure operational in the NDDC in the absence of a Statutory Board.
15.Report of the Tendering Processes for the selection of other forensic auditors, with all relevant correspondence to the Bureau of Public Procurement (BPP) are attached as Annexes VIII and IX above.
CONCLUSION
16.In concluding this briefing, let me reiterate my confidence in the leadership of the House of Representatives led by Rt. Honourable Femi Gbajabiamila and the Leadership as constituted. I hereby state my utmost desire to work closely with House of Representatives in our collective quest for a better Niger Delta Region – nay Nigeria of our dream. It is our belief that the outcome of this public hearing combined with the final report of the forensic auditors shall together help us to reposition the Niger Delta Development Commission to meet the yearnings of Niger Deltans and Nigerians, that have eluded us in the last 19 years.
17.Thank you the Honourable Chairman and Members, for the audience.
Senator (Dr.) Godswill O. Akpabio, CON
Honourable Minister
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