By: Awassam Bassey
Available statistics from the World Bank shows that Nigeria’s infrastructure deficit hit a whooping $2.3 billion (approximately three trillion Naira) a couple of years back, a figure the Nigerian Institute of Quantity Surveyors, and any discerning Nigerian for that matter, know is unacceptably high.
The Institute traced the deficit to an unfortunate phenomenon where contracts for infrastructure development are usually abandoned or haphazardly executed. As a result of this, abandoned projects proliferate or adorn the country’s landscape across the country’s six geopolitical zones . The Institute of surveyors revealed that as at 2022, more than 56,000 projects worth $2.73 billion (approximately N3.5 trillion), have been abandoned in Nigeria over the past 20 years. The report cited poor financial capacity, inaccurate costing, corruption, incompetence, lack of knowledge, poor contracting and contractor practices as the major reasons for project failure and abandonment in the country. This trajectory of evil of course leaves its mark in the form of slow economic growth, wasted resources deployed to the projects abandoned and the opportunity cost of resources deployed.
It was therefore comforting to see reports showing Victor Muruako, Chairman of the Fiscal Responsibility Commission (FRC), inaugurating staff of the commission to begin a physical verification of selected federal government capital projects worth N2.9 trillion earmarked in the 2024 fiscal budget across the six geo-political zones of the country.
The need for physical verification of capital projects cannot be overemphasized as many civil society organizations, especially BudgIT, and anti-corruption agencies including the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices and Other Related Crimes Commission (ICPC), have consistently reported and raised alarmed over the high rate at which contractors abscond from site as soon as they are mobilized with an upfront payment of the contract fee.
BudgIT, for instance, disclosed through its 2022 Tracking Report titled “Empowering Communities for Economic Growth”, that of the 3,691 projects tracked across 22 states in the year to August 2023, only 2,037 were completed while 1,012 were ongoing. It observed that 533 projectswere not executed while 109 were abandoned.
The organization’s Country Director, Gabriel Okeowo, was quoted as saying that despite the clamour for increased allocations to capital expenditure by federal government and subnationals, their organization’s tracking exercise revealed that ‘capital projects are the largest conduits of embezzlement and misappropriation’.
This candid assessment by BudgIT and other civil society organizations outlines the enormity of the task before the Fiscal Responsibility Commission which mandate and functions are well spelt out in the Fiscal Responsibility Act (FRA) 2007.
The Act mandates the FRC to harness the resources of the nation and promote national prosperity and an efficient, dynamic and self-reliant economy. It is also mandated to control the national economy in a manner that secures the maximum welfare, freedom and happiness of citizens on the basis of social justice and equality of status and opportunity. In addition, FRC was set up to manage or operate the major sectors of the economy as well as protect the right of every citizen to engage in any economic activities outside the major sectors of the economy, as well as promote a planned and balanced economic development. The commission is also mandated to ensure that the material resources of the nation are harnessed and distributed as best as possible to serve the common good.
The physical verification exercise, the first of its kind by the commission, falls squarely under the functions encapsulated earlier. The fact remains that the effect of project abandonment affects all citizens and denies Nigerians the right to enjoy the benefits derivable from those projects.
It is also saddening that even those contractors who go ahead to execute projects they are contracted to execute, more often than not end up building substandard projects, using inferior or lesser materials than recommended and generally cutting corners to maximize profit. Therefore, physical verification of projects across the country is an important mandate and one of the oversight functions of the Fiscal Responsibility Commission which, if properly implemented will largely reduce the high level of poor project execution and, in some cases, outright abandonment in Nigeria.
The timing of the inauguration of the committee by the Chairman of the Fiscal Responsibility Commission, Victor Muruako, is apt considering that Nigeria now operates a January to December budget cycle hence the need to commence the physical verification exercise immediately as the Office of the Accountant General and other statutory bodies prepare to release funding for capital projects this first quarter of 2024.
Equally worthy of mention is the fact that the Fiscal Responsibility Commission was thorough enough to list out all the projects to be physically verified so as to stimulate the participation of the locals in each of the six geopolitical zones, namely the South-East, South-West, South-South, North-Central, North-East and North-West geo-political zones of the country.
Though the commission has tasked its staff enlisted for the exercise to carry out the assignments with great diligence and a sense of purpose, it goes without saying that the Commission needs to set up another layer of supervision to ensure the staff undertake their assignments with the seriousness required as well as ensure they do not fall on the banana skin of corruption that the contractors would only be too willing to offer. This will also ensure the adherence of staff to the admonition read to them by Muruako when he urged them to ensure they ‘verify the actual existence of the projects as well as monitor the progress of the work done so far’.
Muruako’s insistence that the verification must be done within the ambit of the Medium-Term Expenditure Framework (MTEF) is commendable as this will ensure that the government will only embark on projects that it can fund. According to section 18 (1) of the Fiscal Responsibility Act (FRA), 2007, ‘The Medium-Term Expenditure Framework shall be the basis for the preparation of the estimates of revenue and expenditure required to be prepared and laid before the National Assembly under Section 81(1) of the Constitution’.
From the above position, it means the verification exercise will serve to determine projects that need funding in line with the completion targets and reduce to the barest minimum, approvals for new capital projects for Ministries, Departments and Agencies (MDAs) where the existing indebtedness to contractors is in billions of naira and ensure there is value for money.
For the contractors, the physical verification should serve as an incentive to do it right and get the accolades and not as an avenue to compete for who can offer the biggest bribe. The truth is that the country as a whole stands to benefit from this physical verification exercise. One only has to take a look at the list of projects to be physically verified cutting across the six geopolitical zones and including infrastructure projects like road dualization, teaching hospitals, power stations, water supply, medical laboratories, new terminal buildings, control tower building, power transmission lines, cancer centre, university hostel, trauma centre, airport runways, among others, to see that this should be a win-win situation if properly executed.
For the Fiscal Responsibility Commission and, by extension, the federal government, the headlines should not stop with the inauguration of the committees; justification will come when the reports are submitted and made available for the Nigerian public. The projects and contractors that pass the test should be named and applauded; those that fail to make the cut should be named, shamed and prosecuted to get taxpayers money back into the treasury.
Awassam Bassey is an Abuja-based public affairs commentator and can be reached via donabas@yahoo.com
