Faulty concessions cost Nigeria millions of dollars – NPA

Sharon EboesomiDecember 8, 20233 min
Mr. Bello Koko, NPA MD

The NPA explained that Nigeria lost billions of naira due to faulty concessions granted to private operators by the federal government in the past

Sen Wadada on NPA
Sen. Wadada, Senate PAC chairman

The Nigerian Ports Authority (NPA) has blamed faulty concessions entered into with private operators by the Federal Government for huge sums of unremitted revenues.

The authority, however, said the Wold Bank is assiting it to rectify the bad deals and that it had been able to recover a fraction of what has now become bad debts.

Recall that the Senate Public Accounts Committee (PAC) had on Tuesday, December 6, 2023, threatened the management of the NPA with sanctions if they failed to appear before it in 48 hours to answer charges over missing sums of money.

The committee was investigationg the 2019 report of the Office of Auditor General which claimed that remittances totaling $852 million and N1.8 billion were allegedly not collected by NPA from terminal operators.

READ ALSO: Senate fumes as NPA evades $1bn query

The Managing Director of the NPA, Mohammed Bello Koko, however appeared with his management staff before the committee on Thursday and explained that the lump sums of $852million and N1.8 billion raised in the queries were accumulation of unremittances from private port operators who came on board through 2006 concession agreements reached with the federal government.

He further blamed the inability of the concessionaires to remit due to various encumberabces they encountered: “The $852 million and N1.8 billion unremittance by private operators to NPA are largely caused by faulty concession agreements the Federal Government signed with them in 2006 when the ports  were concessioned. The concession agreements were faulty in the sense that some of the operators are facing encumbrances in different ways to  cover the space concessioned for them which also encumbered them to remit what are due from them to NPA.

“The encumbrances in question range from inaccessibility of some portions of areas leased,  by concessionaire, communal encumbrance and volume change or turnage  amount,” he said.

He stressed further that the concessionaires had initially faced obstacles because the federal government, which had signed the concession agreement with the private operators, failed to remove structures that belonged to it from the concessionaires right of way.

Out of the $852million going by our in-house assessment, $504million are  accumulated unremitted levies due to encumbered areas. However  we have been able to $232.2million  and N269.4million from the N1.8billiion. We have gotten consultancy from the World Bank for review of the concession agreements which would be free from any form of encumberances,” he added.

On the second query on outstanding debts of $67.45million and N32.266 billion, Koko informed the committee members that the debts were not incurred by NPA, but rather by the now-defunct Nigerian Shippers Councils, whose debtors are no longer traceable.

Chairman of the Committee, Senator Aliyu Wadada (SDP, Nasarawa West), however instructed Koko to provide the committee with their financial statement and a way out for the government to write off the legacy debts.

Sharon Eboesomi

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