15th August, 2011
Â Recent investigation by a Senate ad-hoc committee investigating the Bureau of Public Enterprises has unearthed a lot of atrocities by those saddled with the responsibility of privatising government enterprises, but what happens to the findings? Asks EROMOSELE EBHOMELE
In the next few days, more revelations would be made concerning how greed and personal interest of a few Nigerians who were entrusted with the affairs of the nation overran the immediate anticipated goals of the privatisation of federal government-owned companies.
At the centre of the mess created by the revelations so far is former President Olusegun Obasanjo, who ruled the country for eight years and his second in command, Atiku Abubakar, whose relationship with his former boss became the reason the country further got drowned in its efforts to become one of the leading economiesin the world.
Although commercialisation of some enterprises began in the military era leading to the setting up of the Bureau of Public Enterprises, former President Obasanjo announced a new privatisation programme in July 1999, shortly after becoming the countryâ€™s first elected President. He was scathing in his criticisms of Nigeriaâ€™s large public sector, where some of the more than 1,000 state-owned enterprises have been losing millions of dollars annually.
Obasanjo then declared that â€œstate enterprises suffer from fundamental problems of defective capital structure, excessive bureaucratic control or intervention, inappropriate technology, gross incompetence and mismanagement, blatant corruption and crippling complacency.â€
He informed that he was going on with commercialisation as it was aimed at reducing government cost and further opening the country to the world as this would benefit Nigeriaâ€™s economy and boost employment.
In order to make it effective, Obasanjo instituted a three-phase programme to be carried out under a new high level National Council on Privatisation chaired by Vice-President Atiku Abubakar. First to be sold, according to the terms given by the former President, would be the remaining government shares in 11 firms already listed on the stock exchange and then hotels and vehicle assembly plants would be privatised.
Finally, in the third phase to begin in 2001, government would sell the electricity and telecommunications utilities, national airline, four oil refineries and a fertiliser company.
But the majority of Nigerians who had become sceptical as a result of their experiences with their leaders, opposed the idea as they saw it as a strategy by those in government and their cronies to buy the companies. They feared that it would further throw the country into economic doldrums.
And they were proved right as the fortunes of the country have further depleted since the sale of major enterprises belonging to the country. This became glaring in the face of the rising unemployment resulting from the fact that many of the sold enterprises have either closed shop or engaged in skeletal production.
It is believed that at a point, the BPE lost focus and the goals of privatisation became a mirage just as the people had earlier feared.
The Senate, weeks ago, expressed concern that almost all the privatised companies in the country had failed. While some were not operating at all, others were faced with controversies over their ownership. They also expressed fear that due process was not followed in the sale of some of the enterprises.
Their fear has now led to unpalatable discoveries as those saddled with the sale of the enterprises had their hands soiled either by unqualified bidders or through the directive of the former President that they should discard due process and favour his friends or family members.
For example, a former BPE Director- General, Mrs. Irene Chigbue, confessed before the Senate ad-hoc committee investigating the sale of government enterprises from 1999 to date, that Obasanjo, “in his wisdom,” directed the Bureau for Public Enterprises to seek approval for privatisation of public enterprises from him directly instead of from the National Council on Privatisation (NCP), which was then headed by former Vice President Atiku Abubakar.
Chigbue, the BPE DG between 2005 and 2009, told the ad-hoc committee chaired by Senator Ahmad Ibrahim Lawan, that the normal procedure for transaction then, as provided by the Privatisation and Commercialisation Act of 1999, was that the vice president was the chairman of the NCP and the NCP was the final authority in ratifying every transaction by the BPE, but the political altercation between Atiku and his then boss made it a taboo for her to relate with the former vice president as directed by Obasanjo.
â€œUp to the end of 2006, all memos to President Obasanjo were sent through Vice President Atiku Abubakar, but in 2007, there was a lacuna, there was a vacuum in government and the Minister of Finance, Mrs. Nenadi Usman, was asked to step in as chairperson of the council,â€ the former BPE boss said, adding that she sold 91 out of the 123 public enterprises privatised by the BPE since 1999.
Chigbueâ€™s position was confirmed by the incumbent Director-General, Bolanle Onagoruwa, who said the feud between Obasanjo and Atiku led to the BPE bypassing Atiku over privatisation. According to her, this then led to the violation of due process and the Act establishing the body, where all documents were now passed straight to the former president who gave all the approval without inputs from Atiku.
She added that the former minister of Finance and now a senator representing Kaduna South, usurped the power and functions of the then vice president as the chairman of the National Council on Privatisation.
These two seemed to have confirmed the earlier claim by the former Minister of the Federal Capital Territory Administration (FCTA), Mallam Nasir Ahmad el-Rufai and former member of Obasanjoâ€™s kitchen cabinet, who told the same committee that the former president and his deputy were responsible for the death of privatisation.
According to el-Rufai, who was the DG of the BPE between 1999 and 2003, Obasanjo and his Deputy crippled the privatisation programme.
The former DG, through his explanation, made it seem like he was actually too stubborn for the former president to handle while he headed the BPE.
He said that he repeatedly disagreed with the former president when he made moves to dictate to him. He also claimed to have disagreed with Atiku Abubakar and insisted that the laws must be followed whenever the latter tried to influence his decisions.
The former minister, who accused former Minister of Aviation, Chief Kema Chikwe, of confusing Obasanjo and blocking the sale of Nigeria Airways due to her closeness to the former president, said â€œprivatisation was a mechanical process and there was never a time that we deviated from that process. In the 33 transactions that we did, we followed the book. If there were lapses that came after I left, it was because authorities appointed people that did not understand what privatisation was about but saw BPE as a cash cow.
â€œThe President and I was always quarrelling over privatisation. On Nigeria Airways, we quarrelled on the pages of newspapers but he called me and said, ‘you have done a decent job, give us idea of who should be appointed.’ I then wrote a memo addressed to the vice president and suggested that my successors should come from within because we have spent a lot of money to train them. I recommended three directors and three deputy directors.
â€œThe government of the day decided they were not going to appoint anybody from inside BPE and brought someone who literarily was fired from BPE and that was the beginning of discarding of rules, doing things capriciously, promoting people from one level to three levels and the institution has suffered from it since then. You should have a session with the BPE staff themselves, they were 120 in number.
â€œPresident Obasanjo blocked the privatisation of Nigeria Airways practically because Kema Chikwe will go and tell him stories and what is the result today? The company is dead. 2,000 jobs have been lost.
â€œWe never investigated anyone for corruption except in my last three months and the only person we investigated ended up being the DG, so it is part of the problem. BPE can be improved but I think the key is to have the right people in there and protect them from political interference and fund them properly.â€
He explained that he only supervised the privatisation of 23 out of the 122 enterprises that have been privatised to date and that all those he supervised have been working and making the country proud.
â€œMost of them are doing well and a few have even gone international. For instance, Oando is now listed on the Johannesburg Stock Exchange.
â€œSome 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 â€™77, Nigerian Hotels Limited (now Southern Sun, Ikoyi), Nigerian Hotels (Caterersâ€™ Court, Ikoyi), Nigerian Hotels (House 8 & 9 Lees Road, Ikoyi) and Nigerian Hotels (Audit Section, Ikoyi),â€ he explained.
He claimed that after closing 23 of the transactions, he returned N57 billion to the Federal Government’s treasury and added that from 1970 to 1999, government invested over $100 billion in building enterprises, but earned only 0.5 per cent return on investment from them.
â€œFor example, NITEL, for 25 years, only provided 400,000 telephone lines after putting in $7 billion, the most expensive phone system in the world and they actually think they were doing you a favour if they give you a telephone line.
â€œIn the year 2000, as at December, the total liabilities of 39 public enterprises was in excess of N1.1 trillion and they have accumulated loss of N92 billion and consumed over $3 billion per annum or about $10 million a day. The justification for selling them was very clear and we did it.
â€œThe only thing that is working in Nigeria today is what is run by private sector. Today, we produce 9,000 mega watts of power in our homes with generators and NEPA is giving us 3,000,â€ he stated further.
Others who spoke maintained that bidders were replaced by those favoured by the former president and even those who never bidded for the companies got them on a platter of gold and at cheaper rates.
However, a new dimension set in when a former Deputy Director of the BPE, Charles Osuji, openly confessed that he collected bribe in order to influence the sale of some enterprises to some people and also undervalue such enterprises. Osuji, who was allegedly sacked as a result of his unethical conduct, however, claimed he received the bribe on behalf el-Rufai, an allegation which was immediately denied by another staff who was part of the el-Rufai team at the BPE. Kema Chikwe has also come out to deny the allegations against her.
The confessions so far have become irritating to Nigerians, many of who are now asking for further enquiries and sanctions for those found to have engaged in double standards, no matter how highly placed.
Even human rights lawyer, Femi Falana, has asked that the former president and all those fingered be brought to question. But past experiences have shown that investigations would yield little or nothing as the Senate may end up with a report which would end up occupying a space and gathering dust forever.
In any case, the confessions so far have opened the eyes of Nigerians to the evil of a few against the majority.