- Opposes N309bn FG bond to finance shortfall in electricity market
Damilola Oyedele in Abuja
Members of the House of Representatives have agreed to remove certain items included in the 2016 budget in the course of appropriation, following a meeting between President Muhammadu Buhari and the leadership of the National Assembly to resolve the difference over the budget.
Some of the alterations in the budget, particularly those for constituency projects, were perceived to have been included to cater for the personal interest of the lawmakers.
The resolution was made during an executive session yesterday where the House Speaker, Yakubu Dogara, reportedly briefed the members on the outcome of the meeting with President Buhari last Tuesday.
A lawmaker who spoke off the record, said the speaker noted that the removals are necessary as part of the truce reached with the executive.
“We have to move forward so that the budget can be signed. It does not look good for us as a parliament that we are being blamed for the impasse on the budget. The power tussle has to stop in the interest of Nigerians.
Cuts would be made in lawmakers constituency allocations across board, but there would be more cut in the allocations of the leadership,” the lawmaker added.
Meanwhile, THISDAY gathered that the Deputy Speaker, Hon. Yussuff Sulaimon Lasun, would head the House committee that would interface with the Senate and executive committees on the “grey areas” in the budget.
According to sources in the Senate and House Committees, the Chairmen of the Appropriation Committees, Senator Danjuma Goje and Hon. Jibrin Abdulmumim would be members.
“But they would not play major roles this time,” a source said.
The House has expressed opposition to the plan by the Ministry of Power, Works and Housing to raise a federal government secured bond of N309 billion to cover the electricity market shortfall of N187 billion in 2015 and a projected shortfall of N122 billion for this year.
The House, at the plenary yesterday, noted that the bond would amount to spoon-feeding operators in the power sector where tariffs had been increased twice since 2013 without noticeable improvements in electricity generation.
This is as it mandated its Committees on Power, Privatisation and Commercialisation, Aids, Loans and Debts Management to investigate the usage of the N213 billion intervention fund provided by the Central Bank of Nigeria (CBN) in 2015 through the Nigerian Electricity Sector Intervention facility.
The resolutions of the House followed a motion sponsored by Hon. Edward Pwajok (Plateau PDP) who accused the distribution companies (Discos) of failure to remit revenues collected to other market participants in full.
“Tariff computation was a factor of capital investment which was considered during the privatisation exercise, but regrettable, there is no evidence that the Discos and Gencos invested in acquiring any tangible assets,” he said.
Pwajok further alleged that the successor companies have failed to produce audited financial statements to the Nigerian Electricity Regulatory Commission (NERC) and the Bureau for Public Enterprises (BPE) in the last two years, and have not held annual general meetings to disclose their performance to shareholders.
“The successor companies are supposed to borrow funds secured by their respective balance sheets and revenue streams to run their operations, but the ministry is curiously trying to ride on the Nigerian sovereign guarantee, whereas the companies are not only deriving returns on investments but there is the like …. of another tariff increase to accommodate the cost of the bond, (though they already enjoy cost-reflective tariff in the MYTO 2015),” Pwajok added.
The motion was unanimously passed by the lawmakers.
The House also directed NERC to devise a monitoring mechanism to measure and enforce full monthly remittances by the Discos.
It also urged the regulatory body to recoup all mis-appropriated funds that resulted in the accumulated market shortfalls and apply sanctions for any default whatsoever, including the threat to withdraw the licenses of erring firms.