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Monday, June 17, 2024

Senate indicts Ogun-Osun river basin officials for N726m contracts scandal

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The Senate Public Accounts Committee (SPAC) has conducted an investigation into the alleged contracts scandal of N726 million at the Ogun-Osun River Basin Development Authority. The investigation was based on the 2016 Auditor General report presented to the National Assembly. The Senate Panel upheld the committee’s recommendations, which indicted the Ogun-Osun River Basin Development Authority, and ordered the contractors involved to refund the Federal government.

The contracts scandal involved several irregularities, such as overpayments to contractors, payments for work not done, and unapproved expenditures. For instance, an overpayment of N110,933,994.56 was made to the contractor for the Construction of Water Supply at Agbado-Isoye.

The contractor was paid N404,798,880.80, 71.63% of the contract sum, whereas only 52% of work valued at N293,864,886.24 was done. Similarly, the contractor for the construction of the Small Earth Dam at Ilobi-Irinja in Egbado-South LGA, Ogun State, was paid a mobilization fee of N43,969,340.30 without mobilizing to site.

The contractor for the construction of 5 No. 2.5HA Centre-pivot scheme at Igan/Igua, Yewa North LGA, Ogun State, was paid a mobilization fee of 75% instead of 15%. Also, there were un-priced provisions in the bill amounting to N12,000,000.00 for which there was no evidence of approval for expenditure. Additionally, the sum of N19,138,151.50 spent as contingency was without evidence, and out of 2,750m HDPE pipes for installation only 2,000m were installed.

The Authority paid N158,824,417.90, representing 30.5% of the contract sum, to a contractor instead of N100,089,674.28 (19.21%) for an abandoned project. The authority also paid N567,489,429.71 for a contract that was 98% completed and valued at N527,644,400.00, resulting in an overpayment of N29,076,776.65 to the contractor.

Furthermore, payments totalling N39,590,000.00 were made for some provisions in the bill without evidence of work done, and there was no evidence of expenditure for N5,250,000.00 for project management, capacity building, etc.

The Authority claimed that all expenditures made were in tandem with the Bill of Engineering Measurements and Evaluation (BEME), but the audit revealed otherwise. The construction of Panseke-Onikolobo water supply scheme in Abeokuta South L.G.A., Ogun State, valued at N383,431,551.30, was abandoned despite paying the contractor N204,218,654.94.

The sums of N10,000,000.00 and N13,000,000.00 were for Engineers supervision fees and project management, while payment of N10,000,000 for capacity building was made without evidence of actual execution. A total of N307,648,181.50 was paid to the contractor who abandoned the project while most of the works certified to have been done were not executed, indicating that the financial commitment far outweighs actual work done.

The Senate has indicted the officials of the Ogun-Osun River Basin Development Authority for the N726 million contracts scandal. The irregularities in the contracts highlight the need for greater accountability and transparency in public procurement processes

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