How 25 MDAs Illegally Awarded 52 Contracts Worth N18.3bn- Audit Report

…11 MDAs Paid For Contracts Not Executed

…Two Agencies Involved In Contract Inflation

Facts have emerged as to how 25 Ministries, Departments and Agencies of the Federal Government illegally awarded and executed 52 contracts valued at about N18.36bn.

The award of the contract according to an Audit Report prepared by the Office of the Auditor-General of the Federation is a gross violation of the Public Procurement Act 2007

Specifically, the contracts awarded by these 25 agencies according to analysis of the Audit Report violated Sections 19, 24 and 25 of the Public Procurement Act 2007.

The violation ranges from disregard to due process, irregularity in payment for contracts, excessive pricing of procurements, payment for services not rendered, payment in full for uncompleted projects and other similar infractions.

The Audit Report reads in part, “We examined the level of compliance of MDAs with the provisions of the Public Procurement Act, 2007, particularly Sections 19, 24 and 25 as they relate to their procurement process and found that 25 MDAs awarded 52 contracts amounting to N18,369,595,564.47 in violation of the Public Procurement Act, 2007.

“The violation ranges from disregard to due process, irregularity in payment for contracts, excessive pricing of procurements, payment for services not rendered, payment in full for uncompleted projects and other similar infractions.”

An analysis of the infractions based on the Audit Report showed that 12 MDAs were involved in irregularity in payment for contracts; 11 MDAs awarded contracts without due process, two agencies were involved in contract inflation and over payment to contractors, nine other MDAs awarded contracts under irregular circumstances.

Similarly, 11 MDAs made payments to contractors for services not rendered and unexecuted contracts, two agencies of government were involved in unauthorised contract variation, two others violated their contract approval threshold while another two agencies of government were involved in contract splitting.

A breakdown of how the N18.36bn contract was illegally awarded showed that the Nigerian Social Insurance Trust Fund had N1.39bn, University of Ilorin N78.5m, National Power Training Institute of Nigeria N15m, Ministry of Works and Housing N2.7bn, National Theatre Lagos N34.76m, Voice of Nigeria N13.36m, National Agency for Food and Drug Administration and Control N25.73m, Ministry of Finance N98.54m, and Federal University Lokoja N156.95m.

There is also Federal Character Commission with infraction of N56m, Financial Reporting Council of Nigeria N13.43m, Energy Commission of Nigeria N17.6m, Federal University of Agriculture Abeokuta N113.07m, National Council for Arts and Culture N48.9M, Accident Investigation Bureau N20.5m, Nigeria Police Academy Wudil N35m, Small and Medium Enterprises Development Agency of Nigeria N17.02m, and Petroluem Training Institute N10.56m.

Others are Federal College of Agriculture Ibadan N39.3m, Federal College of Fresh Water and Fisheries Technology N4.92m, National Centre for Technology Management N13.9m, Nigeria Administration on Maritime Safety N115.79m, and Accident Investigation Bureau N20.5m.

The Auditor-General in his Audit Report warned that the violations of the Procurement Act by these MDAs and other forms of weaknesses in procurement processes may be a “deliberate means to siphon public funds.”

He recommended that the Accounting Officers in these MDAs must be made to account for the sum of N18.36bn being infractions on procurement procedures in the award of contracts.

He also said that Financial Regulations 3102, 3103, 3104, 3106 and the relevant Sections of Public Procurement Act should apply in dealing with the violations.