Oduahgate: Who will cast the first stone? By Henry Boyo The frenzy of opinions, allegations and counter allegations on the Nigerian Civil Aviation Authority’s ill-advised purchase of two armoured vehicles has been sustained in the media lately. The unfolding revelations may have overshadowed erstwhile favourable public perception of the otherwise optically credible reconstruction and refurbishment of several airport terminals nationwide. Furthermore, the technical capacity for safety in each airport has similarly enjoyed considerable upgrade. Plane crashes in the recent past have been attributed to poor state of aircraft airworthiness and technical aptitude of aircraft crew rather than poor facilities! Consequently, there are suggestions that a more rigid best practice in aircraft and crew certification by the NCAA may have prevented some of these crashes. However, the Minister of Aviation, Stella Oduah’s unfortunate statement that the recent Associated Airlines plane crash was an “act of God” rather than a lapse in the NCAA’s oversight, inadvertently ignited a wave of angry public responses, which ultimately led to the clandestine revelation that the minister approved the purchase of the two armoured vehicles for protecting the integrity of airport perimeter fences! Her media aide, Joe Obi, later reported to have confirmed the purchase, while noting that the armoured vehicles were acquired because the minister’s life had been threatened because of her strident and alleged uncompromising attitude to positively transforming the aviation subsector. However, as an afterthought, the NCAA added that the vehicles would also be available for use and protection of visiting foreign dignitaries. These explanations may have probably foreclosed further public criticism of the minister. Unexpectedly, however, the media subsequently carried reports that feedback from the car dealers suggested that the two vehicles were grossly overpriced! The House of Representatives Committee on Aviation also intervened and declared that the agency’s request for purchase of two armoured vehicles had earlier been queried and rejected in the 2013 budget presentation of the aviation ministry. Besides, the legislators further noted that only N240m was approved for 25 cars in the NCAA’s budget, but were surprised that the agency went on to purchase the two armoured vehicles in addition to many other vehicles. In her own defence, the Aviation Minister, Stella Oduah, insists that the legislators’ declarations notwithstanding, the armoured vehicles were properly captured in the NCAA’s budget. She also observed that the approved budget for vehicle purchase was not exceeded by the agency, since the said security vehicles were a product of a lease agreement with their bankers. Conversely, however, the agency’s bankers noted that it had no lease arrangement with the NCAA, but insisted that the agency received a loan of N643m, repayable over three years, with a cumulative interest burden of over N500m (i.e. about 25 per cent p.a.)! Nevertheless, the NCAA defensively declared that even if the transaction was a loan, the agency still had not contravened the Public Procurement Act, which prescribes that all expenditures exceeding N100m must be subjected to due process. The NCAA, therefore, argues that the N643m vehicle purchase is accommodated within the agency’s three years Medium Term Expenditure Framework. Nevertheless, the critical questions are, whether the NCAA can seek refuge under the MTEF to violate the official 2013 appropriation of N240m for vehicle purchase? Furthermore, does the agency have the right to borrow medium or long term outside its annual approved budget provisions? Besides, if the sum of N643 was borrowed for the purchase of vehicles, then, what happened to the N240m that was formally appropriated by the legislature? Indeed, even if N100m out of that sum is applied to debt service for the vehicle loan in 2013, the agency will still have to account for the balance of N154m. Consequently, it may be necessary to also probe other bank loans, if any, besides the N643m borrowed from First Bank for vehicle purchase! Surprisingly, there is no realistic sinking fund for repayment of the NCAA’s loan. For example, the N643m loan together with projected service charges of about N500m would come to a total of about N1.14bn, payable by instalment at N400m per annum; an amount, which already curiously exceeds the official appropriation of N240m for vehicle purchase in 2013! The above hazy scenario is most probably replicated in the businesses of most government Ministries, Departments and Agencies; a thorough and transparent consolidation of all such outstanding MDAs’ loans and extra-budgetary expenditure may produce a discomforting insight into the true level of our national debt, outside of the N7tn loans directly attributable to sales of government treasury bills and bonds. The debt burden of several government agencies has inadvertently also become victim of the Central Bank of Nigeria’s excessively high Monetary Policy Rate of 12 per cent, as this oppressive benchmark rate in turn instigates the very high lending rates for both the government and private sector with banks as prime beneficiaries. In the light of the preceding discordant positions between First Bank, the legislature, the NCAA and the Minister of Aviation, we may need to take a closer look at the sources and cost of funds, which the NCAA applied for reconstruction and renovation of several airports nationwide. Do these expenditures fall within approved budgets or were they also sponsored with expensive domestic bank loans without due process? Besides, how transparent and competitive was the process of contract awards for these airports, and how reasonable were the applicable cost of funds? Furthermore, what provisions are in place for interest payment and ultimate liquidation of the capital sums borrowed? In view, also, of conflicting reports from the Customs Service and the Finance Ministry on related duty waivers, there is an urgent need to clarify how much duty was paid on the NCAA’s armoured vehicles, and also confirm whether or not the armoured vehicles were inappropriately, surreptitiously covered by the same certificate of waiver granted to the Lagos State Government for vehicle importation for use at the 2012 National Sports Festival, since the same car dealer was apparently involved in both transactions. Furthermore, with the resonating public angst on this matter, the judges and jury may be quick to indict Ms. Oduah and the NCAA, but it is likely that the operational accounts and bloated expenditure of the Legislature and the Executive would similarly not stand up to any transparent scrutiny or financial audit. The Presidency, for example, may be unable to justify the cost efficiency or social morality of its fleet of 10 classic aircraft in a country where over 70 per cent live below poverty line. Consequently, therefore, if there is any validity to karma, then, it is clear that any stone thrown at Oduah may ultimately return as a boomerang to both the judges and the jury, whose hands are also found to be horridly stained at the ultimate throne of judgment.
Posted on: Mon, 04 Nov 2013 21:07:46 +0000
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