…summons BPE DG over transaction discrepancies
Torkwase Nyiekaa, Abuja
The Nigerian’s Federal House of Representatives Committee on Public Accounts on Monday, 9th Sep. 2024 accused the Bureau of Public Enterprises (BPE) of squandering approximately N10 billion on the registration of two companies for the Nigeria Postal Service, both of which collapsed within a year of their establishment.
Also the Committee directed the Joint Admissions and Matriculation Board (JAMB) and the Investment and Securities Tribunal (IST) to remit N3.457 billion and N6.327 million, respectively, into the Consolidated Revenue Fund of the Federation within 30 days. The agencies are required to submit proof of payment to the Committee within the stipulated time frame.
This was as the Chairman, House Committee on Public Assets, Hon. Bamidele Salam (PDP, Osun), expressed concerns over the alleged N10.4 billion spent to establish two now-defunct companies under the Nigerian Postal Service (NIPOST).
During the resumed investigative hearing of the committee, the panel’s Chairman questioned the rationale behind the enormous expenditure, stating that no reasonable Nigerian would believe such a significant amount was spent only for the companies to fold up within a year.
The two companies in question, NIPOST Transport and Logistics Limited, and NIPOST Property, were launched in May 2023 as part of efforts to diversify NIPOST’s services. However, both companies ceased operations in May 2024 following a directive from the Presidency.
The committee chairman raised doubts about the transparency of the process, calling for a thorough investigation into how the funds were utilized and why the companies failed so soon after their inception. He emphasized the need for accountability, especially considering the economic climate in which public resources are being strained.
The Bureau of Public Enterprises (BPE) has disclosed that approximately N10 billion was allocated for the establishment of two companies, while about N400 million was provided to the BPE to facilitate their takeoff.
Speaking before the committee, the Head of Finance and Accounts at the BPE, Imam Rilwan, who represented the agency’s Director-General, stated that the approval for the registration of the two companies under the Nigerian Postal Service (NIPOST) was granted in 2017.
This, he explained, allowed the BPE to spend around N423 million on the registration process and other preliminary activities necessary for the companies’ eventual operational commencement.
Rilwan further outlined that these funds were critical in laying the groundwork for the establishment of the companies and ensuring their smooth transition into operation.
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He disclosed that, when the money were finally released in 2023, the Bureau had to recover its expenditure, noting that the sum of N423 million allocated to the Bureau of Public Enterprises (BPE) was utilized for the rental of office spaces and other critical services.
The official stated that while the Bureau had begun paying rent for the offices of two companies since 2022, the companies only took possession of the premises in May 2023. However, they ceased operations by May 2024.
He further confirmed that all assets belonging to the two companies have since been formally handed over to the management of the Nigerian Postal Service (NIPOST).
However, Salam emphasized that spending government funds before official release is a clear violation of the Public Procurement Act. He added that such actions should not be taken lightly.
Despite attempts to justify the expenditure, the representatives of the Bureau were unable to explain why funds allocated for other activities were diverted to two companies. Salam also called for the presentation of the necessary approvals from the Bureau to support their actions.
Expressing dissatisfaction with the development, Hon. Salam summoned the Director General of the Bureau of Public Enterprises (BPE), Ayodeji Gbeleyi, to appear before the committee on Wednesday, September 11, at 12:00 PM. Gbeleyi is expected to present all relevant documents related to the disputed transaction.
While addressing the presentation by the Joint Admissions and Matriculation Board (JAMB), Hon. Salam pointed out that their failure to respond to letters from the Fiscal Responsibility Commission regarding their liabilities amounted to an admission of indebtedness to the government.
The Head of Monitoring and Evaluation of the Fiscal Responsibility Commission (FRC), Bello Aliyu Gulmare, has accused the Joint Admissions and Matriculation Board (JAMB) of defaulting in its remittance obligations to the government. Gulmare revealed this during a hearing before a House of Representatives committee, stating that JAMB has only been remitting 25 percent of its Internally Generated Revenue (IGR), rather than the required 50 percent.
According to Gulmare, the FRC had written to JAMB in April to notify the agency of its outstanding remittances, followed by another letter in August. However, both letters went unanswered by the exam body.
In response, the Director of Finance and Accounts for JAMB, who represented the Registrar, defended the Board’s position, stating that JAMB was not receiving any capital or overhead funding from the government. As such, it was only required to remit 25 percent of its IGR. He further claimed that a government circular had exempted JAMB from the 50 percent remittance requirement, an assertion disputed by the Office of the Accountant General of the Federation.
The JAMB official added that the Ministry of Finance had issued a letter granting the Board a waiver from remitting 50 percent of its revenue. He explained that JAMB had chosen not to respond to the FRC’s letters, citing ongoing back-and-forth communications on the issue since 2017.
After listening to both parties, the chairman of the committee and its members expressed dissatisfaction with JAMB’s failure to respond to the commission’s letters. They emphasized that government operations must be conducted through proper correspondence and directed JAMB to remit the outstanding amount to the government’s coffers within 30 days.
In a separate ruling, the committee instructed the Investment and Securities Tribunal to immediately recover and pay into the government account taxes that were not deducted from five contractors, along with the accompanying fines and other outstanding liabilities.
