PMB: FG In Dilemma Over Power Privatisation

President Muhammadu Buhari has disclosed that his administration is facing the classic dilemma on the subject of power holding companies privatisation.

He also declared that epileptic power supply in the country is no longer a laughing matter.

President Buhari stated this yesterday in his address at the National Economic Council retreat on the economy at the State House Conference Centre, Presidential Villa, Abuja.

He lamented that the power sector has been privatised but has yet to show any improvement in the quality of service.

He also disclosed that his administration had given itself the target of generating 10,000 megawatts of power in the remaining three years of its tenure.

He said: “Nigerians’ favourite talking point and butt of jokes is the power situation in our country. But, ladies and gentlemen, it is no longer a laughing matter. We must and, by the grace of God, we will put things right.

“In the three years left for this administration, we have given ourselves the target of 10,000 megawatts distributable power. In 2016 alone, we intend to add 2,000 megawatts to the national grid.

“This sector has been privatised but has yet to show any improvement in the quality of service.”

Buhari listed the common public complaints as constant power cuts destroying economic activity and affecting quality of life; high electricity bills despite power cuts, and low supply of gas to power plants due to vandalisation by terrorists.

“Others are obsolete power distribution equipment such as transformers; power fluctuations, which damage manufacturing equipment and household appliances, and low voltage which cannot run industrial machinery.

“These are some of the problems which defied successive governments. In our determination to change, we must and will, insha Allah, put a stop to power shortages.”

Mentioning the key elements in the power matrix, he said, “We are facing the classic dilemma of privatisation – public interest versus profit motive. Having started, we must complete the process. But National Electricity Regulatory Commission (NERC), the regulatory authority, has a vital job to ensure consumers get value for money and that the over-all public interest is safeguarded.

President Buhari also urged the 22 states governed by the All Progressives Congress (APC) to build 250,000 housing units per annum.

This, he said, is to meet up with the election campaign promise of providing one million houses for Nigerians yearly. He said some estimates put Nigeria’s housing deficit at about 16 million units.

“In our successful campaign to win the general elections last year, our party, the APC, promised to build a million housing units a year. This will turn out to be a very tall order unless: the federal government builds 250,000 units, the 22 APC states together manage another 250,000 units, and we invite foreign investors together with local domiciled big construction companies to enter into commercial housing building to pick up the rest.”

On agriculture, President Buhari noted that both the peasant and the mechanised farmers agree with the general public that food production and self-sufficiency require urgent government action.

He lamented that, for too, long government policies on agriculture had been half-hearted, suffering from inconsistencies and policy somersaults.

He also said that the cost of fertilizers, pesticides and labour compounded the problems of farming, just as he lamented that extension services are virtually absent in several states, among others factors.

“Banks should be leaned upon to substantially increase their lending to the agricultural sector. Central Bank of Nigeria (CBN) should bear part of the risk of such loans as a matter of national policy.

States should increase their financial support through community groups. The appropriate approach should be through leaders of community groups such as farmers’ cooperatives,” he said.

On the difficulties in accessing forex by manufacturing industries, he said: “It grieves me that so many manufacturing industries in the country today are groaning and frustrated because of lack of foreign exchange to import raw materials and spare parts.

“Painful though this is, I believe it is a temporary phase which we shall try to overcome, but there are deeper, more structural problems bedevilling local industries which this retreat should identify short and long-term answers.‎”

President Buhari also recalled that, in his inauguration speech last May, he had remarked that the whole field of medicare in the country needed government attention.

He listed dirty hospitals, inadequate equipment, poorly trained nursing staff, and overcrowding as some of symptoms of a malfunctioning health sector.

He said: “Sound health system is part of the prerequisites for economic development. Nigerians travel abroad, spending an estimated $1billion annually to get medical treatment. Despite huge oil revenues, the nation’s health sector remains undeveloped.

In attacking the challenges of this sector.

“We could start with‎ more funding for health centres to improve service delivery. World Bank and World Health Organization (WHO) could be persuaded to increase their assistance.”

The president recommended that a fresh campaign to patronize Made-in-Nigeria goods be launched, saying that a perfect example would be to source all uniforms in government-sponsored institutions from local factories.”

On Labour, he said: “We need to protect our workers from exploitation, but unions must cooperate with entrepreneurs to substantially improve productivity and quality of products if we are to move forward.”

As for smuggling, he stated: “Smuggling: Need I say more?”

The two-day retreat is to generate immediate, medium and long-term viable policy solutions to the economic challenges facing us at both the Federal and State levels.



Power Ministry To Blame for Nigeria’s Electricity Woes – Minister

The Minister of State for Power, Works and Housing, Mustapha Shehuri, yesterday in Abuja said the ministry of power is to blame for Nigeria’s electricity sector woes.

The minister while speaking yesterday during the induction of 100 graduate engineers for further training at the National Power Training Institute of Nigeria (NAPTIN) under its National Graduate Skills Development Programme (NGDSP), said he came to the realisation that the ministry was the reason behind the under-development of the nation’s power sector following his appointment as minister of state for power.

He said, “I think Nigerians deserve better than this. I came to the ministry of power some four or five months back and I am privileged to know the troubles. I understand the ministry is the reason why Nigeria is not moving forward.

“It has been pulling back Nigeria from independence till date and I believe this government is here to change this for the better. I assure the inductees that after four years of this government, it will hand over to Nigerians a power sector that is better than what is obtainable today.”

Shehuri further disclosed that by 2020, the government plans to ensure that Nigeria generates 25,000 megawatts (MW) of electricity. The current generation is less than 5,000MW, even as past targets have not been met.

However, speaking further, the minister explained that the progress of Nigeria’s power sector had been frustratingly slow considering that the country’s first electricity generation firm was set up in 1896 in Ijora, Lagos with a capacity of 20MW.

“The journey from 1896 to 2016, that is 120 years, has been very long, slow and frustrating. And I think Nigerians deserve better than this.

Nigeria’s plan is to continually increase the level of electricity generation to the target of 25,000MW by the year 2020.

“This can only be achieved through a robust infrastructural development accompanied with a competent technical workforce. This is a national developmental agenda which the ministry of power is committed to,” he added.

He further pointed out that globally there is an increased challenge of supply, adding that Nigeria must therefore, learn new skills and harness opportunities based on research and meaningful development to improve power supply.

In his remarks, the Director General of NAPTIN, Reuben Okeke, urged the National Assembly to consider strengthening NAPTIN with a legislative Act to enable it improve on its mandate to train people for the power sector.



NNPC Did Not Remit N4.9trn To Federation Account – RMAFC

Revenue Mobilization Allocation and Fiscal Commission (RMAFC) has confirmed that the sum of N4.9 trillion was yet to be remitted into the Federation Account by the Nigerian National Petroleum Corporation, (NNPC) between January 2011 and December, 2015.

This is following the Auditor General’s report that the Corporation did not remit N3.2 trillion in 2014.

RMAFC, in a statement signed by its spokesman, Mr Ibrahim Mohammed, said that available records at the Commission’s disposal indicate that between January 2011 and December, 2015, the total indebtedness of NNPC to the Federation Account was N4.9 trillion, a figure that included NNPC’s claims for subsidy on petroleum products, crude and product losses, strategic reserves and the pipeline maintenance cost.

While confirming that the figure of N3.2 trillion was from the 2014 Annual Audit Report obtained from the records of the FAAC Technical Sub-Committee on Domestic Crude Oil Sales and reconciliation statement as contained in the NNPC’s mandate to Central Bank of Nigeria (CBN).

The Statement adds that while the said report claimed that NNPC owed the sum of N3.2 trillion to the Federation Account in 2014 from Domestic crude sale, the Commission’s records revealed that the Corporation owed the Federation Account the sum of N1.99 trillion only in 2014 from domestic crude sales. Therefore, the figure quoted by the Auditor-General of the Federation must have included revenues from other sources.

With regards to the alleged payment of US$235 million realised from the sale of Natural Gas into an undisclosed Escrow Accounts by the NNPC, the Commission explained that the NNPC on behalf of the NLNG had entered into agreements with three international oil companies (IOCs) namely Nigeria Agip Oil Company (NAOC), Shell Petroleum Development Company of Nigeria (SPDC), Total E&P Nigeria Limited (TEPNG) under a Modified Carry Agreement (MCA) proceeds from which are deposited in Escrow Accounts for funding the various Gas projects under the LNNG.

The total amount transferred to the various accounts from 2012 to November 2015 was $1.615 billion. The Commission, through the FAAC Post Mortem, has consistently requested the NNPC to provide it with updated financial statements on the projects but NNPC was yet to respond.

The RMAFC said it has been working with NNPC to reconcile the figures following a tripartite meeting held with the NNPC, Federal Ministry of Finance (FMF) and RMAFC in December, 2015 where it was agreed that in view of the subsidy and other claims by NNPC, the Forensic Audit of the NNPC was very critical in establishing which party was actually indebted to the other. The Forensic Audit was expected to be concluded by the end of March, 2016.