A report on the performance of Nigerian Ports has revealed that the country loses over N1 trillion every year to port inefficiencies, process failures and corruption.
The report titled ‘Nigeria: Reforming the Maritime Ports’ which was commissioned by the Centre for International Private Enterprises in collaboration with the Lagos Chamber of Commerce and Industry and Financial Derivatives Company, was publicly unveiled in Lagos on Friday at the LCCI public-private discussions on port reforms.
The report states that while the efficiency of port operations is a major driver of trade and economic activities across countries, Nigeria’s case has been rather gloomy.
It says over the years, users and operators at the Nigerian Ports have been facing lingering challenges and bottlenecks which include infrastructure shortcomings, policy and regulatory inconsistencies, overlapping functions and duplicity of roles among government agencies operating within ports across the country.
The report also pointed out that a lack of clear legislation, ports governance remains prone to inefficiency and corruption. It added that under such condition, companies in the Nigerian ports have to deal with bureaucratic red tape, constant delays, high costs, harassment, and demands for illegal charges.
Losing Money And Potential
Estimates from the research show that trillions of Naira in revenue is lost annually within the ports and business community due to inefficiencies and inherent shortcomings.
The report also stated that these inadequacies at the ports diminish their potential to create about 10,000 new jobs annually and about 800,000 jobs on the long run.
The Nigeria: Reforming the Maritime Ports report claimed that Nigerian seaports remain the most expensive in the West African sub-region attributing this to the cumbersome documentation requirements and double charges imposed on importers and exporters.
Using a semi-structured survey, respondents of the study listed the documentation processes, requiring 25-33 different papers from multiple agencies as the biggest issue contributing to time and cost delays at Nigeria’s seaports.
About one-fourth of the respondents also complained about the duplication of functions of the multiple agencies within the ports while 29% of those surveyed in the report say multiple cargo inspections are the most critical of operational bottlenecks.
Not All Doom
It is not all doom for the industry according to the report.
It stated that Nigeria’s ports continue to see substantial increment in gross tonnage by 3.3% – Compounded Annual Growth Rate – to 144.2 million tons between 2010 and 2015.
The annual growth rate of 1.8% is expected to rise until 2021 despite the challenges in the sector.
However, these growth projections are premised on the assumption that the nation’s ports will continue to be the preferred means of transporting goods in and out of the ECOWAS sub-region.
Call For Immediate Port Reforms
In its recommendations, the report pointed out that authorities should embark on immediate port reforms.
These reforms are expected to lead to faster clearance of goods, shorter waiting times for ships awaiting berth, eliminating redundancies in the functions of the several regulatory government agencies in the ports.
It also called for the adoption of an Integrated Advance Cargo and customs clearance system, with scanning, sealing and tracking (SST) capabilities, establishment of a National Trade Data Centre and implementation of a Single Window Platform.
The report also called for more private sector investment in Nigerian Ports, reduction in the number of government agencies to 6 from 14.
From the policy end of things, report called for the immediate passage of certain legislative bills that will aid port reforms and improve performance.
These bill include the National Transport Bill and the Port and Harbour Bill (PHB).
The Federal Government has promised a better national budget in 2017 to address the issue of abandoned projects across Nigeria.
The government also pledged to bring a rest to the crisis of confidence over the 2016 Budget, which has been fraught with allegation of padding right from the beginning.
The Minister of National Planning and Budget, Mr Udo Udoma, disclosed this on Wednesday at a two-day conference on capital projects, implementation and monitoring organised by the Nigerian Institute of Quantity Surveyors (NIQS) in Makurdi, the Benue State capital.
The Minister, who was represented by the Director of Budget Planning, Mrs Olasunbor Ayinde, hinted that the 2017 Budget would attain uniform cost price for all items presented by MDAs to fund the abandoned projects spread across the country.
President of the NIQS, Mercy Iyortyer, expressed worry over the more than 19,000 abandoned projects across Nigeria, including the Benue State Sheraton Hotel which has remained uncompleted after 33 years.
The Benue State Governor, Mr Samuel Ortom, who was represented by his deputy, Benson Abounu, blamed the spate of uncompleted projects on lack of ethical behaviour on the part of professionals.
The Senate Committee Chairman on Public Procurement, Senator Mohammed Abdulsalami, on his part explained the controversy of budget padding while he blamed the legislature and the executive for lack of restraint.
The Federal Executive Council (FEC) has approved a presidential initiative on continuous audit, to strengthen controls of Federal government expenditures.
The Minister of Finance, Mrs Kemi Adeosun, made the decision known on Wednesday while briefing reporters on the outcome of the FEC meeting held in Abuja, Nigeria’s capital.
Mrs Adeosun said that the initiative would not just strengthen the internal audit of the payroll but general expenditures, which may include among others, contracts and pensions of Ministries, Department and Agencies (MDAs) without notice.
She revealed that the government had commenced the second phase of the payroll of another potential 11,000 ghost workers.
This the Minister said was sequel to the first phase of the payroll audit which revealed the existence of 23,000 ghosts workers, which saved the country about 2.29 billion Naira.
The Federal Executive Council (FEC) says it is perfecting strategies towards plugging leakages in the Federal Ministries, Departments and Agencies (MDAs).
Briefing State House correspondents after the council meeting presided over by President Muhammadu Buhari, the Minister of Finance, Mrs Kemi Adeosun, said the strategy which is the only item at the first meeting of the FEC in 2016, is aimed at fiscal growth of the economy.
Mrs Adeosun decried a situation where many agencies of government don’t remit revenues to the Federation Account.
She maintained that henceforth, MDAs must submit a budget which must be approved by the government to ensure that public monies in public agencies are well spent.
She said the objective is to ensure that every Naira of government is well utilized.
The Council observed that in the past, MDAs spend money without control.
The Minister of Finance also denied reports that the Federal Government has withdrawn the budget.
According to her an audit has been carried out on agencies that collect money in foreign currency, to ensure that such agencies comply with the extant rules.
President Muhammadu Buhari says his administration will look inwards and enforce regulations to stop financial leakages in order to overcome the current economic challenges facing Nigeria.
The President said this while receiving the Managing Director of the International Monetary Fund (IMF), Ms Christine Lagarde, at the Presidential Villa in Abuja.
He said his government would adopt global best practices in generating more revenue to mitigate the effect of dwindling oil prices on the Nigerian economy.
President Buhari added that his administration would implement greater discipline, probity and accountability in all revenue generating agencies of the Federal Government.
“We have just come out of budget discussions after many weeks of taking into consideration, the many needs of the country and the downturn of the economy with falling oil prices and the negative economic forecasts. We are working very hard and with the budget as our way forward, we will do our best to ensure that our country survives the current economic downturn.
“We have also told all heads of Ministries, Departments and Agencies (MDAs) of government that on our watch, they will fully account for all funds that get into their coffers,” President Buhari told Ms Lagarde.
The President revealed that the Federal Government was reviewing its operational costs and had directed all the MDAs to cut down on their overhead costs.
He said that the government would welcome the technical support and expertise of the IMF for its plans to diversify the Nigerian economy and further unleash its growth potentials.
In her remarks, Ms Lagarde said that the IMF would be willing to assist the Federal Government in plugging revenue leakages, tracing stolen funds and restructuring its tax system.
She said that Nigeria has all the potentials to overcome the current economic challenge of falling commodity prices without resorting to the IMF for financial support.
The Kwara State Governor, Abdulfatah Ahmed, has presented a budget estimate of 116,164, 043,000 naira to the state House of Assembly for the 2016 fiscal year.
The estimate is a decrease of over 1.5 billion naira over the 2015 revised appropriation which represents 1.3% decrease.
Out of the estimate, the budget is made up of recurrent expenditure of over 48 billion, over 10 billion naira for the public debt service while over 57 billion is earmarked for capital expenditure.
Tagged the budget of sustained expansion, the State Governor, Abdulfatah Ahmed, who laid the budget before the state lawmakers, said that the budget proposal was based on zero-budgeting approach for ministries, departments and agencies to justify all their expenditure needs in line with the prevailing economic situation in the country.
According to him, the total projected revenue estimate from all available sources to the state for 2016 fiscal year is over 116 billion naira.
Governor Ahmed also said that the 2016 Kwara budget holds great opportunity for the state and country, despite the challenges ahead.
He called on residents of the state to continue to cooperate with the government in its effort to elevate the state and contribute their quota to the development of the state.
A Nigerian economist has stated his opinions about the 2016 national budget presented to the National Assembly on Tuesday.
“Putting it in a very awkward position, I consider the budget process a joke,” he said.
Professor Pat Utomi was on Channels Television’s Sunrise Daily on Tuesday morning, few hours before the presentation of the budget by President Muhammadu Buhari before a joint session of the National Assembly.
He further said that “January 20 years ago, I was one of those who began to analyse the budget, and by December, there were issues with implementation.
“We somehow do not have the discipline of the budget process, we go through budget as public relations exercises because they are supposed to be done and decision makers go ahead to do whatever they want to do,” he said.
Low Energy In Leadership
Proffering solutions to the problem of budget implementation, Professor Utomi said that “the goal is to achieve an execution premium, but if those who are responsible for it (the budget) really had no plan whatsoever to follow the budget, then, you are wasting your time.
“When those who are responsible for it, do not see long term goals in which the budget is just a piece in an unfolding set of activities that would reach a certain goal, there is no point of it.
“I think what has happened to us is that we got to a point of disconnect between the leadership elite, the political class, the bureaucratic elite and development aspirations of the Nigeria people,” he said.
Professor Utomi further said that the major reason why the budget isn’t working in Nigeria is ‘leadership’.
“There is low energy in leadership. we are not leading the country in the right direction.
“What the country is dealing with is a huge financing gap; we used to earn so much and now, we are earning this much, if we pretend that nothing has changed, then we would go into an economic spiral”, he added.
While stating that the 2016 budget would focus on addressing youth unemployment and cater for the vulnerable, President Buhari said that Nigeria remains committed to diversification to build and reflate the economy.
The Managing Director of Systemspecs has provided some information about the company, the software, Remita and its role in the collection of government’s revenue.
Speaking on Channels Television’s Sunrise Daily, Mr John Obaro clarified that Remita is not a company, contrary to the belief of many Nigerians, but a software platform through which government funds are remitted.
Systemspecs, according to him is a software house. “We have been in business for about 24 years, we support sound system; accounting software and we have human manager which is a home grown application,” he said.
Explaining the company’s emergence, he said, “In 2011, we were invited to participate in the process for the selection of the platform for the TSA. We bid with a local company, they looked at the foreign option and we were selected before the assignment.
“We started with payments in January 2012. That has been going on well because we started with about 116 MDAs which has increased to about 900 and there weren’t problems with the payment side.
“Issues came in when we were to start the collections. The collections were supposed to start January 2013 but didn’t happen until the former president, Dr. Goodluck Jonathan gave an order early this year (2015) which ought to start in March, but started slowly until October when President Muhammadu Buhari gave his order and then, we now have a spike,” he explained.
The Systemspecs boss also clarified, “Payment is when government is paying out salaries to contractors while collection borders on when government is receiving funds into its account.”
Mr Obaro further explained that the idea of TSA was for government to have a view of all accounts. “About 17,000 accounts have been closed. We have put in place a system to keep track of all the MDAs, the accounts they have, and also manage each MDA independently.”
He gave an insight into the controversy surrounding Remita as raised by Senator Dino Melaye on the floor of the Senate.
“We respect the role of the National Assembly in oversight functionary, but the way the motion came was a bit harsh because we thought some judgments were made before full facts were available.
“Having said that, we have had the privilege of meeting with them to at least, shed some lights on what has been going on.
“Senator Melaye was right to raise an issue, the language may not have been right, I may not be comfortable, but I think its alright to raise issues of concern across any sector of the economy,” he said.
Senator Melaye had argued that the use of Remita was a violation of Section 162(1) of the constitution, which stated that “the federation shall maintain a special account to be called the federation account into which all revenues collected by the government of the federation except the proceeds from the personal income tax of the personnel of the Armed Forces of the Federation, the Nigeria Police Force, the ministry or department of government charged with foreign affairs and the residents of the FCT, Abuja”.
He further stated that the CBN could only appoint a registered bank as an agent for collecting and disbursing the funds and that since Remita was not a bank, its appointment as a collection agent was in violation of the CBN Act and the Banks and Other Financial Institutions Act (BOFIA) 2007.
The Systemspecs boss said, “The whole issue surrounds the charge of 1%. In fairness, the Senate commended the TSA as a project.
“In our contract, there was a clause that said the fee for collections will be agreed by all the parties; office of the Accountant General of the Federation, Central Bank of Nigeria (CBN), Commercial Banks and Systemspecs – the platform provider.”
Senate President, Dr. Bukola Saraki, says the trial of former National Security Adviser (NSA), Colonel Sambo Dasuki (rtd), over alleged mismanagement of billions of Naira meant for arms procurement is a partial indictment on the National Assembly.
Dr. Saraki made the statement after the Upper Chamber debated a motion on Tuesday at the National Assembly in Abuja, Nigeria’s capital.
He said the Senate had not properly performed its oversight functions on Government Ministries, Departments and Agencies (MDAs).
“Distinguished colleagues, I want us in this 8th Senate to ensure that our committees carry out proper oversight and we the leadership are going to ensure that we too find a way of making sure that the committees do their work of oversight because truly, that is the bottom line to this,” the Senate President said while reacting to Dasuki’s trial.
Senator Saraki said the inability of the Senate committees to effectively oversee government MDAs had ensured that gross mismanagement of revenue and incompetence in MDA’S have been left unchecked for too long.
“We must play our role in the area of oversight because if we do not play it, this is what we get at the end of the day,” the former Kwara State Governor said, as he tasked his colleagues on efficiency.