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Fashola, Reps in face-off over N42bn contract fraud allegation

Minister of Power, Works and Housing – Babatunde Fashola,

The Minister of Power, Works and Housing, Babatunde Fashola and members of the House joint committee on Power and Public Procurement were in a face-off yesterday over allegations that his ministry fraudulently awarded a N42 billion contract.

But the Minister dismissed the allegations of fraudulent award of a N42 billion contract under the Rural Electrification Scheme in some federal Universities, adding that the ministry only got approval to award at the sum of N38.9 billion of which only N9 billion was appropriated.

Instead, he accused the joint committee of harboring the petitioner and accuser of his ministry in their midst.

Similarly, the managing director, Rural Electrification Agency, Damilola Ogunniyi said those peddling the allegations of fraudulent award of contracts under the Energizing Education Programme (EEP) as ignorant.

“I would like to unequivocally place it on record that no contract has been awarded by REA amounting to N42 Billion on the Rural Electrification Scheme in some Federal or any other Universities. REA denies the allegations to the extent of their inconsistency with facts and our position as contained in the Memorandum submitted to this dignified House”, Ogunbiyi stated..

Fashola was invited to explain to joint committees the role of his Ministry in the N42 billion Rural Electrification projects which was allegedly awarded without due process.

While speaking at the investigative public hearing the Minister surprised the members when he claimed that the author of the petition against his ministry was seated amongst the members.

“I said what I said because of the allegations against us that we’ve acted fraudulently, and I have cause to believe that the gentleman is now advising this Committee”, he said.

According to him, the gentleman, one Ronald Van Arnult who now serves as consultant to the Power Committee was one of those owed by the Federal Government.

At the onset of the Buhari administration, he said, there were so many contractors making claims of being owed by the past administration for jobs done and there was a need to investigate and verify.

Fashola further said : “However, investigations revealed that there was no procurement for his contract and some others, but we couldn’t ask him to go away, having provided some evidence of work done, we had to reach an agreement to offer a base-sum, otherwise, government wasn’t going to pay..

Giving insight into the award of the contract, the Minister said; “Getting that approval, we got N9bn. When I complained in 2017 about reduced allocation to the power Ministry, the chairman, Power said he reduced the budget, and when I asked why, he said “well, you can’t get everything that you want, and we laughed over it, and I said in 2018, we will expect an increase by which time you would have become a champion of this course”, Fashola said.

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He told the lawmakers that under the Public Procurement Act, government was only obliged to pay 15percent of the sum involved in the rural electrification/Fast Power Programme contract.

He also went on to explain the level of implementation of the ‘Fast Power Programme’ and how institutions/zones were selected for project citing and implementation.

He said instead of conducting a public hearing on a matter, a simple letter would have resolved the issue as there was no fraud whatsoever in his Ministry.

The information on the consultant surprised the members of the committee and invited stakeholders. Hon. Oluwole Oke (PDP, Osun) who is the chairman of the House committee on Public Procurement, said he was hearing the information for the first time. ” The Power Committee must have found it expedient to engage the services of the gentleman,” he said.

“An accused person in a court case can be used by the prosecutor as a prosecution witness to enable free flow of information for the prosecutors” he added.

Fashola continued: “I want to chose my words carefully, because I know that you have the power to investigate anything, but I think that a simple letter to us would have avoided all these, that’s my humble opinion”, he said.

Engr. Babtunde Kuye, Director Energy Procurement at the Bureau of Public Procurement however confirmed that the Bureau really issued the Certificate of No-objection on the contract to the Ministry as shown by the minister.

He told Hon. Dan Asuquo, Chairman of the Power Committee on questioning that the BPP also wrote a letter to the panel that they knew nothing of the project, which contrasted the Ministry’s position.


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