The office of the Auditor-General of the federation has unearthed alleged series of irregularities in the award, implementation and payment of a contract worth N7.5 billion by the Nigerian Ports Authority (NPA).
An audit report on Ministries, Departments and Agencies (MDAs) carried out by the office of the AG and signed by AG himself, Anthony Ayine, has revealed this.
The AG recommended that the Managing Director of the NPA be sanctioned in line with extant regulations for the infringements.
The annual audit report, which has been submitted to the Public Accounts Committee of the National Assembly, shows that several flaws were recorded in the management of public funds and resources across many MDAs.
The discovery encompasses irregularity in expenditure and failure to transfer excess revenues to the treasury, altogether running into billions of Naira.
The NPA awarded the contract in question to Shore Erosion Control Work based in Akipelai, Otuoke and Ayakoro, all towns in Bayelsa State, to the tune of N7.5 billion, the 2017 audit report said. The contract letter, with reference number HQ/GME/CP/CON/R.16/067 and dated 22 March, 2012, put the contract completion period at 14 months.
Ayine disclosed that four payment certificates and an advanced payment in the sum of N4.24 billion, being 56.61% of the total contract, had been made to the contractor as of 11 November, 2015.
The AG stated that the Bill of Quantities under Bill No. 1 (General) and other documents accompanying the payments confirmed that a conditional bank guarantee obtained from Zenith Bank with a validity period of 365 days supported the N1.12 billion mobilisation fee paid to the guarantor.
According to Mr Ayine, the guarantee expired on 2 March, 2013 and was contrary to the provisions of Section 35(1a) of the Procurement Act, 2007 and Financial Regulations 2933 ‘i’ (2009), which provided for the sum of an unconditional bank guarantee or insurance bond.
He went further to say that the contractor had not renew the bank guarantee with the balance of unrecovered advance payment of N539.45 million after four years of expiration.
The report noted that N19.5 million was paid for the procurement of three Toyota Hilux vehicles without proof of purchase and that a provision of N13.5 million was made as annual running cost for the project vehicles, out of which only N6.75 million was certified and paid to the contractor.
“The sum of N11.25m certified for compensation of properties to be affected by the project and paid in certificate No.3 had no records on how the money was utilised nor the beneficiaries involved.
“The sum of N12.5m provided for community relations was certified and paid vide certificate No. 3 with no supporting documents to validate the payment.
“The sum of N128m provided for insurance of the work and insurance against damages to persons and properties was certified and paid through certificate No. 3 with no evidence that any insurance policy was undertaken,” the report said.
The audit report further stated that N4.2 billion was the amount paid for the contract according to the Principal Manager’s report on Interim Valuation Certificate No. 4 dated 11 November, 2015 even though N3.9 billion was the value of work implemented. By implication, the contractor was paid N344.26 million in excess according to the report.
“During the inspection of the project, it was revealed that the contractor had since abandoned the project site; and the duration of the project had since lapsed without approval for its extension,” the audit revealed.