‘How Obasanjo, Yar’Adua, Jonathan Squandered N11tn Electricity Fund’
The Socio-Economic Rights and Accountability Project (SERAP) has alleged that the administrations of former Presidents Olusegun Obasanjo, Umaru Musa Yar’Adua and Goodluck Jonathan squandered over N11 trillion meant to provide regular electricity supply for the country.
This figure was revealed in a new report titled “From Darkness to Darkness: How Nigerians are Paying the Price for Corruption in the Electricity Sector,” presented to the public in Lagos Wednesday by SERAP with the support of the MacArthur Foundation.
According to the report researched and presented by Dr. Yemi Oke, an Associate Professor, Energy/Electricity Law, Faculty of Law, University of Lagos, the squandering might reach N20 trillion in the next decade given the rate of government investment and funding in the power sector amidst dwindling fortune and recurrent revenue shortfalls.
He said: “The total estimated financial loss to Nigeria from corruption in the electricity sector starting from the return to democracy in 1999 to date is over Eleven Trillion Naira (N11 Trillion Naira).
“This represents public funds, private equity and social investment (or divestment) in the power sector. It is estimated that it may reach over Twenty Trillion Naira (N20 Trillion Naira) in the next decade given the rate of government investment and funding in the power sector amidst dwindling fortune and recurrent revenue shortfalls.
“The country has lost more megawatts in the post-privatisation era due to corruption, impunity, among other social challenges reflected in the report.
“The much-publicised power sector reforms in Nigeria under the Electric Power Sector Reform Act of 2005 is yet to yield the desired and/or anticipated fruits largely due to corruption and impunity of perpetrators, regulatory lapses, and policy inconsistencies. Ordinary Nigerians continue to pay the price for corruption in the electricity sector–staying in darkness, but still made to pay crazy electricity bills.”
The 65-page report also accused the Dr. Ransom Owan-led board of the Nigerian Electricity Regulatory Commission (NERC) of allegedly settling officials with millions of naira as severance packages and for embarrassing them with alleged N3 billion fraud.
While urging the authorities to undertake a thorough, impartial and transparent investigation into the reasons why corruption charges in the electricity sector were withdrawn against the accused persons, the report also called for the reopening and effective prosecution of corruption allegations, including the alleged “looting of the benefits of families of the deceased employees of Power Holding Company of Nigeria (PHCN) levelled against a former Permanent Secretary in the Ministry of Power, Dr. Godknows Igali”.
According to him, “The Obasanjo administration spent $10 billion on NIPP with no results in terms of increase in power generation. $13.278,937,409.94 was expended on the power sector in eight years while unfunded commitments amounted to $12 billion.
“The federal government then budgeted a whopping N16 billion for the various reforms under Liyel Imoke (2003 to 2007) which went down the drains as it failed to generate the needed amount of electricity or meet the set goals. Imoke was alleged to have personally collected the sum of $7.8 million for the execution of the contract for the construction of the Jos-Yola Transmission Line, which was never executed. There were documented/reported allegations of corruption against Imoke that fizzled-out shortly thereafter.
“Professor Chinedu Nebo handed over the assets of the PHCN to private investors on November 1, 2013. Prof. Nebo is alleged to have corruptly funded the privatised power sector with over N200 billion despite privatisation. The allegation of N200 billion funding of the privatised power sector during Prof Nebo’s tenure should be thoroughly and transparently investigated and anyone suspected to be responsible should be prosecuted. Any corrupt funds should be fully recovered.
“Our research revealed that the sum of N1.5 billion with which the vehicles were acquired was allegedly sourced from the diverted N27 billion insurance premium of deceased workers of the defunct Power Holding Company of Nigeria (PHCN).
“The National Assembly and members should desist from and avoid manipulating the award of electricity contracts or cite projects in their constituencies under the guise of ‘Constituency Project’. The National Assembly should publish and ensure the full implementation of the recommendations of all power-related investigations to date.
“The federal government should back-down from Rural Electrification initiatives and allow states to undertake rural electrification through their respective local governments and development areas. Federal government should consider fully divesting its stakes in the power sector and allow for efficient, decentralized sector governance by the Federal and State governments, as appropriate, in line with the provisions of the Second Schedule, paragraph 13 and 14 of the Constitution of the Federal Republic of Nigeria 1999 (as amended).
“The 36 state governments should wake up to their rights, duties, and obligations under the Constitution of the Federal Republic of Nigeria relating to the power sector by working to promote and ensure access to regular and uninterrupted electricity supply for all residents within their states. The 36 state governments have been abdicating their duties to the power sector, bearing in mind that Power is an item on the Concurrent Legislative List under the Nigerian Constitution 1999 (as amended).”
Also speaking at the launch, Mr. Femi Falana (SAN), who chaired the event charged the state governments to challenge the laws restricting them from generating electricity in their states.
He said state governments must begin to exercise their constitutional rights by challenging the control of electricity generation, distribution, and transmission by the federal government.
He said Items 13 and 14 of the schedule to the constitution stipulated that state government “shall have the power to generate electricity outside the national grid”.
He said: “It goes further to say that the House of Assembly of each state shall make a law for the establishment of electricity boards in all states–they are not there!–to provide electricity for the people outside the national grid.
“I generate electricity in my home, in my office. So why can the governor of Lagos State not generate electricity for all of us – about twenty million people?
“The power Reforms Act of 2005 is largely illegal because it has attempted to concentrate power and electricity on the federal government and private companies contrary to the provisions of the Constitution.
“That’s why we are challenging state governments to, ‘stop going to Abuja, stop begging federal government’ to give you the power to establish electricity companies in your state.
“You have the right. If individuals can do that, why should you go to Abuja to get a licence?”