Damning revelations have been made at the sitting of the Senate ad hoc Committee investigating the activities of the Bureau of Public Enterprises (BPE). The image of former President Olusegun Obasanjo was again dealt a blow in the course of the session with Malam Nasir El-Rufai, a former Minister of the Federal Capital Territory who has also served as the Director General of the BPE.
Apart from the allegations that his administration did not follow due process in the privatization exercise it executed, Obasanjo was also accused of selling Delta Steel Company to Global Infrastructure instead of the winner of the bidding process, BUA Group.
El-Rufai pointed it out at the sitting that that he only supervised the sale of 23 firms, which amounts to 18 per cent of the 122 enterprises sold.
El-Rufai who claimed that the companies sold under him are still doing well also disclosed that he had quarrels with the then President, Chief Olusegun Obasanjo over the privatization of some firms. He said he turned down several requests from Obasanjo and his vice, Atiku Abubakar to influence the sale of government companies to their cronies.
Speaking on what seemed to be the genesis of the Bureau of Public Enterprise’s woes, which he alleged started when he left, the former Minister said “I wrote a memo to the Vice President and I made suggestions that my successor should come from within BPE because we had spent a lot of money training people to prepare them for this, because any time I travelled for more than a week, one of my six directors acted as DG. On the basis of that I recommended three directors and three deputy directors.
The government of the day said it would not appoint anyone from inside. They went and brought someone who literally was fired from BPE and brought him back. That is the beginning. They discarded rules, doing things capriciously, promoting people three levels ahead and the institution has suffered from this since then.”
Street Journal’s investigations have revealed that at the end of the assignment of the Senate Ad hoc Committee, the sale of some Public Enterprises where there is any infraction may be reversed.
The fact-sheet submitted by Malam El-Rufai reads “As DG BPE, I supervised the privatization of 23 of the 122 enterprises that have been privatised to date (amounting to 18% of the total). These enterprises came from sectors including hotels and hospitality, banking, cement and oil marketing. Most of them are doing well, and a few have even gone international. For instance, Oando is now listed on the Johannesburg Stock Exchange. Some of the companies are Unipetrol (now Oando), African Petroleum, National Oil (now Conoil), Ashaka Cement, WAPCO, CCNN, BCC, Calabar Cement, Capital Hotel, Abuja ( Abuja Sheraton), Festac ’77, Nigerian Hotels Limited (now Southern Sun, Ikoyi), Nigerian Hotels (Caterers’ Court, Ikoyi), Nigerian Hotels (House 8 & 9 Lees Road, Ikoyi), Nigerian Hotels (Audit Section, Ikoyi)
The cumulative value of FGN investment by way of equity, loans and other transfers to these 62 enterprises is estimated at nearly US $70 billion – nearly a third of Nigeria’s total oil revenue since 1973. Unfortunately, it is extremely unlikely that the Government will ever recoup these investments for obvious reasons, including but not limited to:
1. Inflated contracts for capital equipment and services (ALSCON)
2. Poor project management leading to time, and cost over-runs (Ajaokuta)
3. Diversion of funds by managers of the PEs appointed by successive governments (AP)
4. Poor performance and profitability leading to low share prices and asset values (NICON, NITEL)
5. Unfriendly political and economic environment to attract quality foreign and domestic investors. (Virtually all sectors)
“As at December 2000, the total liabilities of 39 of these PEs were in excess of N1.1 trillion, with accumulated losses of N92.3 billion.
The case for privatization in Nigeria therefore is not very different from those in other countries. But in Nigeria, the very poor performance of the public enterprises and the high level of corruption, even by developing country-standards, made it even more imperative.
The purpose of privatization is to reduce or eliminate the drain on the public treasury that these public enterprises represented. At BPE we wrote the telecoms policy that allowed the NCC to initiate the GSM revolution. NITEL that remained in government hands tells the story of the malaise of public enterprises.”
Meanwhile, Malam Nasir El-Rufai too was boxed into a defensive corner as Mr. Jean-Charles Osuji a former deputy director of the Bureau of Public Enterprises (BPE) has confessed that he collected bribe from billionaire businessman, Otunba Mike Adenuga, to undervalue National Oil (Conoil) during his stint at the bureau. He made the confession before the same senate ad hoc committee which had earlier listened to Malam El-Rufai.
Osuji disclosed that the bribes he collected from the billionaire businessman were paid both in dollars and Naira and they were collected on behalf Mallam Nasir El Rufai. Osuji was at a point allegedly given $ 100,000 by the businessman. He however stated that he failed to remit the money to El-Rufai and that he was sacked as a result of that particular action. Osuji surprisingly asked the senators to help in reinstating him to his previous post.
Speaking on Osuji’s allegation, the current director General of the Bureau of Public Enterprises, Bolanle Onagoruwa, said that nobody asked Mr. Osuji to collect bribe. And when the committee asked whether Mr. Osuji was issued any query before he was fired, it was found out that none was given.
The public hearing proved to be quite revealing as the committee was told how the Obasanjo administration jettisoned due process in order to ensure that friends and allies of the then President benefitted immensely from the privatization embarked upon. El-Rufai alleged that President Obasanjo and his deputy; Abubakar Atiku contacted him at several times to influence the sale of government companies to their cronies but that he turned them down each time.
The Senate Committee’s public hearing has not been without questions from Nigerians though. Some have asked why the panel would round off its public hearing without hearing from former President Obasanjo.
In some quarters however, Osuji’s request to be reinstated has been described as funny. One of the followers of the Committee’s public hearings said “instead of begging not to be handed over for prosecution, a man who admitted that he took bribe and short-changed his boss is asking to be reinstated.”
While Nigerians are also waiting anxiously to see whether the anti-graft agencies would take any action and embark on a probe of the activities of the BPE especially those relating to the allegations of bribery, it is already being discussed in hushed tones in some quarters that with the big fishes involved, nothing will eventually come out of the probe.