Government Agency Sold Over N2bn Worth Of Assets For N13bn

House of Representatives
House of Representatives

The office of the Auditor-General for the Federation sold Assets; the federal plant, property, and equipment (PPE) worth more than N2 billion to the Ogun-Oshun River Basin Development Authority for a pittance of N13.618 million.

Olufemi Odumosu, the Managing Director of the Agency, told the House of Representatives Committee on Public Accounts that PPE was sold at public auctions run by auctioneers chosen by the Federal Ministry of Water Resources, which also gave its approval.

The Nation got records from the PPE auction that showed an 800 KVA Perkins Diesel generating set that the agency bought in 2006 for an undisclosed amount was sold in 2018 for N550,000 naira because it was “unserviceable.”

A CAT Payloader purchased in 1982 for N70,000 Naira was sold for N40,000 Naira, while unserviceable earthmoving equipment like bulldozers, graders, and escalators were sold for between N350,000 and N550,000.

A Toyota Camry 2.5L purchased for N8.150 million in 2013, with a book value of N1.222 million and a repair cost of N1.2 million, was sold for N22,500 naira, while trimmers purchased in 2004 and lawnmowers purchased in 2005 were sold for N2000 and N6500, respectively.

Three Peugeot 504 station wagons, purchased for N2.9 million each and still in good working order, were sold for N26,400 apiece, while a Mistubushi canter lorry purchased for N8.55 million was scrapped for N80,000 and a DAF (1000) lorry purchased for N5 million was sold for N90,000 apiece.

Also sold for the same N187,500 was a Toyota Hilux purchased for N3.75 million that would have cost the agency N187,500 to fix.

Odumosu told the House of Representatives Public Accounts Committee that the auction was run in an open and honest way with the Ministry of Water Resources keeping an eye on things.

Even though Odumosu said the PPE sale happened in the late 1970s and early 1980s, a close look at the papers given to the Committee showed that the oldest property was bought in 1980 and the newest was bought in 2013.

During the hearing on the Assets, Odumosu asked that the documents be taken away and replaced with others, but his request was turned down by the committee.

“Your observation, which is however noted,” he said in his submission dated May 16, 2022, “was premised on the fact that at the time of disposal, the authority could not hands-on all schedule of historical cost relating to these unserviceable items.”

“This primarily was because they (unserviceable items) were procured dating back to the late 1970s to early 1980s at the commencement of the operations of the authority, spanning over a 35 to 40 year period.”

Meanwhile, most of the officers directly involved in the purchase had either died, retired, or both. However, frantic efforts to recall relevant living retirees to assist in the archival retrieval of records relating to the purchase of the items had yielded significant results.

Rep. Wole Oke, who is the chairman of the House Committee on Public Accounts, was unhappy with the situation. He criticized the way auctioneers were chosen and how the ministry stepped into the role of the agency’s board.

Oke said that the Assets were given more importance than the rules of the Public Procurement Act, which could have cost the government money.

On the other hand, the Committee asked the Minister of Water Resources and the Permanent Secretary in the Ministry to explain their roles in the auction on June 9.

Rep. Abdullahi Abdulkadir, who is the Committee’s Deputy Chairman, asked the agency to send a report on the assets value to the House before they were sold. He pointed out that the Ministry’s letter to the auctioneers made it clear that the items couldn’t be sold for less than the government’s value.

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