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Tag: Zainab Ahmed

  • Fed Govt to fund firm’s mass housing projects

    TO meet the mass housing target set by the Muhammadu Buhari administration, the Federal Government has agreed to provide enough funding for the execution of the Family Homes Funds for the next five years.

    The government has authorised the board and management of the fund to source for more funds from third party institutions, such as development finance institutions and the capital market.

    This is to ensure that the provision of mass housing does not lack funding.

    Finance Minister Mrs Zainab Ahmed broke the news on Monday in Abuja at the inauguration of the board of the Family Homes Funds.

    But she did not say how much the government will release for the mass housing project.

    She said: “The present administration is committed to the implementation of this housing policy through the provision of enough funds for its sustainability in the Medium Term Expenditure Framework for the next five years.”

    The minister said the Federal Government “established the Family Homes Funds for the provision of affordable homes for 500,000 low income Nigerians and the creation of 1.5 million jobs”.

    This, she said, “is in realisation of the President Buhari administration’s goal of bridging the housing needs gap with the aim of promptly addressing the numerous demands for government interventions in the housing sector”.

    Read Also: Zainab Ahmed resumes at the Ministry of Finance

    Given the huge amount of money the Family Homes Funds is expected to raise from the Federal Government and other financial institutions, the Finance Minister told the board members of the company that government “will require unusual commitment, uncommon focus, experience and determination to succeed. Without doubt, the Federal Government expects results, measurable ones at that”.

    Mrs Ahmed advised the board and management “to establish top corporate governance culture and a carefully designed internal control mechanisms”.

    She added: “The Family Homes Fund will receive significant amounts of public money, in addition to other capital from development finance institutions and the capital market. It must, therefore, be a reliable steward of resource on your part.”

     

  • Economy…The challenges to come

    The 2020-2023 Medium Term Expenditure Framework and Fiscal Strategy Paper warns that there will be challenges to the economy during these periods. Assistant Editor NDUKA CHIEJINA examines the strategy paper

     

    THE 2020 – 2022 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) outlines the Federal Government’s fiscal policies/strategies and macroeconomic projections for 2020 – 2022. It also provides a broad framework for the annual budget in line with the Fiscal Responsibility Act (FRA), 2007.

    In crafting the 2020-2022 MTEF/FSP, the government said it expects “more diversified and inclusive growth over the medium-term, and reduction in the rate of unemployment, as we continue to implement the priority policies and programmes that will boost inclusive growth.” This is because President Muhammadu Buhari said employment would be a key focus of his second term.

    Finance and National Planning Minister Zainab Ahmed, while presenting the MTEF/FSP document, added that success has been recorded in containing the insurgency in parts of the Northeast with economic activities recovering. However, recurring conflicts between farmers and herdsmen in some parts of the country, as well as incidences of flooding, have affected agricultural production.

    She added that “militancy in the Niger Delta has generally abated, although breaches of pipelines still regularly occur. This was partly responsible for the lower than projected oil production volume in the first half of the year. Except for a few months, inflation has continually declined since January 2017 from 18.72% to 11.08% in July 2019.”

    Key assumptions

    The Underlying Assumptions of the 2020 – 2022 MTFF projects that oil production volume will average 2.18mbpd for 2020. Although this is lower than the projected oil production volume of 2.3mbpd for 2019, Mrs Ahmed said: “We believe that this is a more realistic projection. For 2021 and 2022, the projections are 2.22mbpd and 2.36mbpd respectively. Actual daily crude oil production and exports have been well below budget projections since 2013, despite the installed capacity of up to 2.5mbpd, for many reasons.”

    A lower benchmark oil price of $55/b (against $60/b for 2019) was also projected because of “the expected oil glut in 2020, as well as the need to cushion against unexpected price shock. There are strong indications of an oversupplied market in 2020.”

    All three of the major forecasters – Organisation of the Petroleum Exporting Countries (OPEC), International Energy Association (IEA) and the U.S Energy Information Administration (EIA) generally see non-OPEC production growing by around 2mbpd this year, and by even more next year. U.S. shale oil accounts for most of the total supply increase, but new projects in Norway, Brazil and Australia will also contribute to the increase in non-OPEC supply. Also, market sentiments do not support an expansion in demand. The growth in demand for OPEC oil specifically is projected to slow down next year.

    Real GDP growth rate projections are put at 2.93 per cent, 3.35 per cent and 3.85 per cent for 2020, 2021 and 2022.

    “Even though this falls short of the ERGP projection, the trajectory remains in the right direction,” Mrs Ahmed said.

    On the expenditure side of the framework, the minister said the government has tried to keep most expenditure items as low as possible. The Federal Government, she said, has proposed a budget estimate of N9.789 trillion for next year. For the next two years, she stated that N10,110,193,322,738 will budgeted for 2021 and N10,418,391,196,907 for 2022.

    There will be a sustained growth of statutory transfers of N526,456,288,013 in 2020, N560,165,806,678 in 2021 and N602,577,931,995 in 2022. For debt servicing in the next three years, N2,452598,930,000 will spent in 2020, N2,737,051,570,000 in 2021 and N2,942,639,740,000. To settle matured government obligations like bonds and Treasury Bills (TB), under the sinking fund item, government plans to spend N296,000,000,000 in 2020, N220,000,000,000, in 2021 and N286,670,000,000.

    For three years, the Presidential Amnesty Programme will gulp N65 billion annually from 2020 to 2022. Projections for the entire Service Wide Vote (SWV) comprising transfers to NBET and GAVI Immunisation, in the next the three will gulp N1,371,552,510,357.

    Mrs Ahmed said 2020 to 2022 fiscal years would be very challenging concerning revenue generation and rapid growth in personnel costs. She attributed the growth in personnel cost to the creation of new ministries and appointment of additional ministers.

    The finance minister was confident that the government will take firm decisions to address the revenue shortfall and increasing personnel cost. To contain rising personnel cost, she disclosed that “any government staff not captured in the Integrated Payroll and Personnel Information System (IPPIS) by October 2019 will not be paid.”

    A development economist and financial expert, Mr Odilim Enwegbara, who serves as Chairman/CEO at Pan Africa Development Corporate Company (PADCC) said: “The economy is not growing because of political instability and insecurity now a commonplace.”

    According to him, “the continued over-centralisation of the economy which is the basis for revenue collection, remittances and distribution centralisation has made it easier for tax evaders to exploit as well as for tax collectors to fail to remit government collected taxes. So, understandably, diversion of taxes especially value-added tax is unbelievably so high. So the revenue crisis becomes inevitable.”

    Enwegbara added that “besides poor economic performances, causing revenue crisis, it is the nonexistence of modern tax collection and remittance infrastructure that has been the real basis for government’s inability to collect taxes. Hence, the focus on borrowing against tax. This has increasingly endangered the economy to the extent that today our debt service to revenue ratio is at 70% — and expected to reach 80% before the last quarter of 2020. This ratio has become the highest amongst peers’ economies, causing foreign investors to now systematically avoid Nigeria’s economy and its looming bankruptcy.”

    To address these challenges to revenue, Eweagbara identified some steps to be taken to include investing in “Easy VAT technology which makes it impossible for VAT evasion, let alone VAT diversion. FIRS is already in possession of the proposal which by blocking the current loophole which is as high as 70% will bring in extra trillions of naira into the TSA.”

    This, he said, “is beside the proposed increase of VAT from the current 5% to 7.20%. Even though our VAT rate ought to be as high as 15%, at least let’s start at 7.20%. The only problem is that once you increase VAT at a time there’s no corresponding growth in citizens’ purchasing power, consumption of certain products will drastically reduce and this will lead to laying off of workers as factories begin to witness larger part of the products unsold. This too will lead to fewer companies paying fewer taxes to the government. Also, there’s an element of inflation. Most important, as a result of high tax evasion, the economy becomes unfair to those who are ready to pay tax against those who evading tax.”

    From 2020, the budgets of all MDAs and Government Owned Enterprises (GOEs) will now be contained and published in the nation’s annual budget.

    In 2020, the Federal Government plans to cut N1.16 trillion off capital expenditure from N2.92 trillion in 2019 to N1.76 trillion in the proposed 2020 budget.

    This will then see capital expenditure dropping to 21 per cent of total expenditure in 2020 compared to 32 per cent in the 2019 approved budget.

    The minister said Nigeria is planning to trim its budget for 2020 marginally by 0.19 per cent to N8.90 trillion, as against the N9.16 trillion approved by lawmakers for 2019.

    The government approved a 34 and 66 per cents capital/ recurrent expenditure fiscal policy in 2018 and 32 and 68 per cents in the approved 2019 budget.

    Details of the medium-term expenditure framework (MTEF) and fiscal strategy paper (FSP) 2020-2022 showed that capital expenditure will suffer successive cuts for the three-year period to N1.76 trillion, N1.70 trillion and N1.68 respectively for 2020, 2021 and 2022 despite increases in total expenditure at N8.6 trillion, N8.98 trillion and N9.4 trillion during the same period. Recurrent on the other hand is expected to increase from N3.41 trillion in 2018 to N4.7 trillion in 2019.

    In the coming year, the government plans to borrow N1.7 trillion in 2020. Of this amount, N850 billion will be domestic borrowing while the balance of N850 billion will be from foreign borrowing.

    “The draft 2020-2022 Medium Term Fiscal Framework shows that Nigeria faces significant medium-term fiscal challenges, especially concerning revenue generation and rapid growth in personnel costs,” the minister said.

    Thus, key reforms, such as the Strategic Revenue Growth Initiative (SRGI), will be implemented with increased vigour to improve revenue collection and expenditure management.

    Mrs Ahmed added: “In furtherance of our objective of greater comprehensiveness and transparency in the budget process, it is proposed that the FGN budget from 2020 will reflect the revenues and expenditures of GOEs and the multi-lateral/bi-lateral project-tied loans and related expenditures.”

    2020 and the following years will be interesting. As the finance minister warned that the year will be challenging, she announced that 35 state governments would start refunding the N614 billion bailout/budget support fund extended to them a couple of years ago. The government, she said, will start recovering the N614 billion budget support facility from state governments this month.

    States, the minister said, will start getting direct debits from their monthly Federation Account Allocation Committee (FAAC) disbursements.

    According to her, “the recovery process for us is to deduct from the FAAC allocation to the states and then we remit to the CBN and we are going to start these remittances by the next FAAC” which will hold in two weeks.

    To show how serious the government is about making the deductions, the finance minister revealed that “there will be no requirement for us to consider the FSP implementation. We do that as a matter of wanting the states to stay on the path of fiscal sustainability but it will not be a condition for the deduction. We will deduct direct at source and remit to the CBN.”

    “The N614 billion bailout funds to states is not going to form part of the revenue for funding the budget, it was a loan which was advanced by the CBN and the repayment will be made to the CBN.”

    Last month, a committee was put in place to facilitate recovery of N614 billion given to 35 states. 35 states benefited from the facility, and each state is expected to pay back the equivalent of N17.5 billion.

    On the N650 billion to the states the minister spoke about, it was conditional budget support provided by the CBN to help states pay salaries gratuities and pensions. CBN provided N650 billion in loans at 9% with a grace period of two years. The Federal Ministry of Finance helped in disbursements with documented approval by the presidency. That was why the finance minister said the money belongs to the CBN and is going to be paid into CBN account.

    With regards to incentives and waivers given to investors, the finance minister said: “We have too many incentives and too many waivers. But our partners in the trade will not necessarily agree with us. We also agree that there has to be a review of the pioneer status certificate issuance process because the waivers and the incentives are costing us a lot.”

    She cautioned that government will not just withdraw its decision on granting pioneer status accorded to some investors, adding that “when a decision has been made and approvals have been given, and a private business makes an investment decision based on those incentives, you can’t pull it out overnight. So, there has to be a period within which the commitments that have been made are allowed to exit before you impose new conditions.”

    She added that the government is “currently reviewing the quantum of waivers. The idea is to see which one we can begin to pull back and throw away from the pool to reduce the cost of government. But to encourage businesses and to make Nigeria competitive, some of them are essential.”

    With Nigeria joining other African countries to sign the agreement establishing the African Continental Free Trade Area (AfCFTA), there could be tremendous opportunities for Nigeria in the medium term. However, the AfCFTA could also create a nightmare situation for the country unless the right policies and actions are implemented expeditiously to improve Nigeria’s economic competitiveness.

    An economic expert, Mr Tope Fasua, noted that “the figures are depressing really because from the plans between now and 2022 there is nothing to look forward to.”

    He described the MTEF and the proposed 2020 budget as “very dismal…precisely they want to do the same N8.9trillion next year N9.3trillion the year after 2021and of course N9.7trillion for 2022 and what that means is that the rate of growth in the budget is much lower than the rate of inflation and that’s scary.”

    Fasua proposed that “we should try and increase our budget at least by the rate of inflation. Every body’s salary should increase year on year by the rate of inflation to cover for inflation, that’s how it’s done every year.”

    The rate of growth in the budget, he said, “is bizarre and again other things I noticed includes that we are going to have a continued deficit financing as a matter of fact, we are doing 27 per cent deficit financing this year but we want to do 28 per cent deficit for next year 29 for 2021 and 20 per cent for 2022. Now if you look at the fact that we are going into AfCTFA and of course we are even talking about the West African Monetary Union, there is a standard that needs to be maintained in terms of yearly budget deficit 27%, 28%, 29% is way above that limit and in fact its only recently we started having this kind of budget deficit because normally you usually want to keep your budget deficit around 3% to 6%. 10% should be too high, I don’t know where we are going if you ask me it’s a bit really scary. We want to have some clarification.”

    With regards to borrowing, Fasua said: “N1.6tn this year, 1.7tn next year and 1.3tn in 2022 and I see that the borrowings are intended to be split 50:50 between local and foreign borrowing. That means we are not getting out of this borrowing circle. I think the pressing thing is that the projections are bleak.”

    He advocated for “fundamental thinking to take us out of this kind of a spiral, we need to take ourselves out of the spiral; we need to be able to reduce our deficit budget substantially.”

    According to him, “we need to begin to look at other sources of funding our budget beyond our borrowing as well. Remember that we went into the recent recession in 2016, chances are with the way this budget is done, it’s quite fragile that if any of the projections are missed and of course the major projection here is crude oil prices which they have targeted at $55 for the MTEF going forward because the ministry has also said that they expect there to be an oil glut by 2020 which is what OPEC projects.”

    Fasua feared that if there is any major shift or even a slight shift in the negative, the country would go into recession.

  • Federal Govt proposes N9.789tr budget for 2020

    The Federal Government has proposed a budget estimate of N9.789 trillion for next year.

    Finance Minister Mrs. Zainab Ahmed, who dropped the hint on Tuesday, reeled out the figures (N10, 110, 193, 322, 738) for 2021 and (N10, 418, 391, 196, 907) 2022.

    She announced the proposals while presenting the draft of the 2020 to 2022 Medium Term Expenditure Framework and Fiscal Strategy Paper in Abuja.

    According to her, the government would start the deduction of the N614 billion budget support facility from state government accounts this month.

    She said the states, except Lagos, would start getting direct debit notifications from their monthly Federation Account Allocation Committee (FAAC) disbursements.

    “The recovery process for us is to deduct from the FAAC allocation to the states and then we remit to the CBN and we are going to start this remittances by the next FAAC” which will hold in two weeks’ time.

    “There will be no requirement for us to consider the FSP implementation. We do that as a matter of wanting the states to stay on the path of fiscal sustainability but it will not be a condition for the deduction. We will deduct direct at source and remit to the CBN.

    “The N614 billion bailout funds to states is not going to form part of the revenue for funding the budget, it was a loan which was advanced by the CBN and the repayment will be made to the CBN.”

    Last month, the Federal Government announced the setting up of a committee to facilitate the recovery of N614 billion given to the states.

    Each of the benefitting state is expected to pay back the equivalent of N17.5 billion.

    She said that N650 billion was a conditional budget support provided by the CBN to help states pay salaries, gratuities and pensions.

    The CBN provided the N650 billion in loans at nine per cent with a grace period of two years. The Federal Ministry of Finance helped in the disbursements with documented approval by the presidency.

    With regards to the many incentives and waivers given to investors, the Finance minister said: “We have too many incentives and too many waivers. But our partners in the trade will not necessarily agree with us. We also agree that there has to be a review of the pioneer status certificate issuance process because the waivers and the incentives are really costing us a lot.”

    She warned that the government will not just withdraw its decision on granting pioneer status accorded to some investors, adding: “When a decision has been made and approvals have been given, and a private business makes an investment decision based on those incentives, you can’t pull it out overnight. So, there has to be a period within which the commitments that have been made are allowed to exit before you impose new conditions.

    “The government is currently reviewing the quantum of waivers. The idea is to see which one we can begin to pull back and throw away from the pool to reduce the cost on government. But to encourage businesses and to make Nigeria competitive, some of them are essential.”

    Read Also: Federal Govt okays N600b for power sector

    The government has also warned Nigerians to brace for challenging 2020 to 2022 fiscal years.

    Mrs. Ahmed said the 2020 to 2022 fiscal years would be very challenging with respect to revenue generation and rapid growth in personnel costs.

    She attributed the growth in personnel cost to the creation of new ministries and appointment of additional ministers.

    She, however, assured of the government readiness to take firm decisions to contain rising personnel cost.

    Mrs. Ahmed said: “Any government staff not captured in the Integrated Payroll and Personnel Information System (IPPIS) by October 2019 should forget salaries.”

    From 2020, the budgets of all MDAs and the Government Owned Enterprises (GOEs) will now be contained and published in the nation’s annual budget.

    The 2020 – 2022 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) outlines Federal Government’s fiscal policies/strategies and macroeconomic projections for 2020–2022 and provides the broad framework for the annual budget in line with the Fiscal Responsibility Act (FRA), 2007.

    In the proposed 2020 appropriation, the Federal Government plans to cut N1.16 trillion off the capital expenditure from N2.92 trillion in 2019 to N1.76 trillion.

    This will then see capital expenditure dropping to 21 per cent of total expenditure in 2020 compared to 32 per cent in the 2019 approved budget.

    Mrs. Ahmed said the country is planning to trim its budget for 2020 marginally by 0.19 per cent to N8.90 trillion, as against the N9.16 trillion approved by lawmakers for 2019.

    The government approved a 34 per cent  and 66 per cent capital/recurrent expenditure fiscal policy in 2018 and 32 and 68 per cents in the approved 2019 budget.

    Details of the Medium Term Expenditure Framework (MTEF) and fiscal strategy paper (FSP) 2020-2022 showed that capital expenditure will suffer successive cuts for the three-year period to N1.76 trillion, N1.70 trillion and N1.68 respectively for 2020, 2021 and 2022 despite increases in total expenditure at N8.6 trillion, N8.98 trillion and N9.4 trillion during the same period.

    Recurrent on the other hand, is expected to increase from N3.41 trillion in 2018 to N4.7 trillion in 2019.

    Key assumptions of the 2020 Budget Framework, oil production 2.18 mbpd; oil price $55/b; exchange rate N305/$; inflation rate 10.81per cent; nominal consumption N122.75 trillion; N142.96 trillion nominal GDP; and GDP Growth Rate of 2.93per cent.

    A lower benchmark oil price of $55/b (against $60/b for 2019) is assumed considering the expected oil glut in 2020, as well as the need to cushion against unexpected price shock.

    There are strong indications of an oversupplied market in 2020. All three of the major forecasters – Organisation of Petroleum Exporting Countries (OPEC), International Energy Association (IEA) and the U.S Energy Information Administration (EIA) generally see non-OPEC production growing by around 2mbpd this year, and by even more next year.

    Federal Government plans to borrow N1.7 trillion in 2020 of this amount, N850 billion will be domestic borrowing while the balance of N850 billion will be from foreign borrowing.

     

     

  • Govt unveils 11 economic priority areas

    FINANCE Minister Mrs. Zainab Ahmed, on Wednesday  said the Federal Government has designed 11 Economic Priority Areas.

    She also gave assurance that budget 2020 will be submitted to the National Assembly by the end of  this month.

    In her opening remarks at a high-level roundtable on National Donor Coordination in Abuja which resulted in the decision to create a Donor Coordinating Unit, she said the area of economic and governance reforms, the government will focus on macro-economic stability through coordinated economic, monetary, fiscal and trade policies; fight corruption and improve governance.

    In the area of enhanced investments in physical infrastructure, human capital development to spur job creation and economic growth, Ahmed said government will target improved health, “education and productivity of Nigerians; ensure energy sufficiency with power; ensure energy sufficiency with petroleum products; improve transportation and other infrastructure; and drive industrialisation, focusing on micro, small and medium (MSMEs).”

    To optimize investments in physical security and food security to drive inclusive socio-economic development, Ahmed outlined the following economic agenda the government will pursue: Improved security for all citizens; enhance agriculture self-sufficiency to achieve food security; enhance social inclusion by scaling-up social investments; and improve access to mass housing and consumer credit to enhance financial inclusion.

    Speaking on the activities of donor agencies and the creation of a coordinating unit on donor programmes. Ahmed said: “The need for a government-driven national donor coordination mechanism cannot be overemphasized in that a well-structured approach is key to ensuring that external financing is maximised and of benefit to Nigerians.”

    Read Also: Zainab Ahmed resumes at the Ministry of Finance

    She said there was need to “work together to put in place a National Donor Coordination Mechanism that is aligned to government’s key strategic priority areas as set out in our national plans, policies and annual budgets. While government led, this process must be collaborative in order to succeed.”

    To give effect to this direction, Ahmed said: “We will be engaging towards setting up a Donor Coordination Unit (DCU) to be chaired by the Minister of Finance, Budget and National Planning, and cochaired by the  Minister of State, Budget and National Planning, and the Chair(s)of the Donors Coordination Committee.” We will task the DCU to develop a road map toward setting up a Multi-Donor Trust Fund, to be managed by the World Bank, which will pool donor funds to enhance transparency and accountability. “Aid is most effective when it is well-coordinated, with mutual accountability mechanisms for government and donors. Above all else, it must be aligned with government’s strategic development priorities.”

    She said government has “made some progress in coordinating aid in specific areas, such as in the Northeast intervention, and the Social Investment Programmes , we still have a long way to go in ensuring a government-led mutual accountability framework for aid coordination in Nigeria.”

    She said for the donor initiave to succeed, there must be a governmentowned and driven aid management process.

  • Unemployment, biggest challenge of Nigeria’s economy – Finance Minister

    THE Minister of Finance, Budget and National Planning, Hajiya Zainab Shamsuna Ahmed, has said the biggest challenge facing Nigeria’s economy is unemployment.

    She however said as part of efforts to implement President Muhammadu Buhari’s resolve to lift 100 million Nigerians out of poverty, all sectors of the economy have been told to focus on creating jobs in different ways.

    She stated this at a reception organised in her honour by her family and friends under the auspices of Kaduna Well Wishers in Kaduna on Saturday.

    She added that, sourcing funds for medium enterprises will be a major measure to be employed, saying that, “as medium businesses grow, there will be more employment.”

    The minister, while appreciating everyone, who played a vital role in her reappointment, applauded the Kaduna State Governor, Malam Nasir El’rufai for recommending her reappointment.

    Read Also: Ministers take charge

    “It came to me as a shock for Mr. President to have given me the triple tier ministries; this came to me as a complete shock. One thing I have learnt over time is that once I have an assignment, I enter the place and look for those who are experts in it because I believe I do not know everything and in every place, an expert can be anyone. I do not differentiate but learn from everyone.

    “I have also learnt something from my father, which is to respect everyone, especially the ones who support you, such as the drivers, securities and even your cook, because these are the people who will support you when you treat them right.”

    Governor Nasir El’rufai in his own speech expressed gratitude to the President for reappointing Hajiya Zainab Shamsuna Ahmed.

     

  • Osinbajo chairs economic management team meeting

    Vice-President, Prof Yemi Osinbajo, on Wednesday presided over the Economic Management Team meeting at the Presidential Villa, Abuja.
    The meeting was attended by  heads of Ministries, Departments and Agencies dealing with the economy and the finances of government.

    Read Also: Osinbajo condemns high port charges

    Among those at the meeting included the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed; Governor of the Central Bank of Nigeria, Mr Godwin Emefiele; Accountant-General of the Federation, Mr Ahmed Idris, among others.
    The meeting was still in progress at the time of filing this report.

  • Nigeria launches battle against $9.6b UK verdict

    LOCAL and foreign collaborators are behind the controversial $9.6 billion (N3.5 trillion) judgment debt against Nigeria, the Federal Government said on Tuesday.

    A British Court on August 16, awarded the judgment authorizing a firm, Process and Industrial Developments Ltd. (P&ID) to seize Nigerian assets anywhere in the world to the value of $9.6 billion for contract default.

    The firm entered into an oil  deal with the Ministry of Petroleum Resources in 2010, during the administration of the late President Umar Musa Yar’Adua.

    The government described the contract as a product of “criminal and fraudulent conspiracies, right from inception”.

    President Muhammadu Buhari has ordered the Economic and Financial Crimes Commission (EFCC), the National Intelligence Agency (NIA) and the Police to probe the criminal conspiracy behind the failed contract.

    The government said the contractor, P&ID, did not execute the job it claimed and the contract signed “in an underhand manner”.

    The Federal Government has invoked  all its powers to resist the enforcement of the judgment including obtaining a stay of execution.

    It insisted that the $9.6 billion damages, which is one fifth of the country’s foreign reserve, if implemented, is capable of impoverishing the country and “inflicting grave economic injury on Nigeria and its people”.

    Three ministers – Alhaji Lai Mohammed (Information), Hajia Zainab Ahmed (Finance and Economic Planning), Attorney General/Justice Minister Abubakar Malami and Central Bank of Nigeria  Governor Godwin Emefiele, on Tuesday jointly spoke to reporters on the controversial judgment.

    The finance minister described the damages awarded against Nigeria as “excessive and exorbitant”.

    According to Hajia Ahmed, an award of $9.6 billion is equivalent to N3.5 trillion which is our annual budget.

    She added: “This award is unreasonable, excessive and exorbitant. It is also unfair and it is an assault on each and every Nigerian. It is beyond trying to compensate for a commercial interest.

    “For us in the Ministry of Finance, Budget and National Planning, we take comfort from the efforts that so far had been put in place by the Attorney-General of the Federation and Minister of Justice to ensure that this judgment is set aside because the consequences will be unpleasant for each and every Nigerian.

    “And I hope our brothers and sisters in the press will help fight the cause of our country. We will be doing that not just for this administration but for our children and children. So it is time for us all to be up in arms to make sure that we are not unfairly treated as a people.”

    Mohammed said: “We want to place on record that the Federal Government views with serious concerns the underhanded manner in which the contract was negotiated and signed.

    “Indications are that the whole process was carried out by some vested interests in the past administration, which apparently colluded with their local and international conspirators to inflict grave economic injury on Nigeria and its people.

    “With the contract having suffered a setback, the case went to arbitration. P&ID’s claim in the arbitration proceedings was mainly for the loss of profit for the 20-year term of the GSPA. In an interim award, the Arbitration Tribunal ruled that Nigeria has breached the contract. Though Nigeria successfully applied to have that award set aside by the Federal High Court in Lagos, the Tribunal ignored this decision.

    “Consequently, on 31 January 2017, the Tribunal rendered its final award against the Ministry of Petroleum Resources in the sum of $6.597billion  together with pre-award interest at the rate of 7% per annum, effective from 20 March 2013 and post-award interest at the same rate from the date of the award. This interest increased the size of the award to US$9.6billion.”

    Read Also: U.S. blames Fed Govt for changes in visa fees

    The Minister said the Federal Government had made attempts since 2017 to resolve the issue amicably with P&ID.

    He also said the government engaged the services of the US law firm of Curtis, Mallet-Prevost, Colt & Mosle LLP to defend similar proceedings in the US District Court of Columbia.

    “After the arbitration award in 2017, Nigeria made several attempts to negotiate the award and resolve the whole issue amicably with P&ID but to no avail, which eventually led to the enforcement proceedings instituted, simultaneously, by the company in the UK and the US.

    “The Federal Government then engaged the services of the US law firm of Curtis, Mallet-Prevost, Colt & Mosle LLP, which took steps to defend the proceedings in the US District Court of Columbia to dismiss P&ID’s application for the enforcement of the award on the grounds that Nigeria, as a sovereign state, has an absolute right to obtain an authoritative determination of its sovereign immunity.

    “While Nigeria has recorded some successes in the ongoing case in the U.S., the Federal Government will ensure that its interest and that of the people of Nigeria are vigorously defended.”

    Mohammed said it decided to challenge the award after receiving an expert report which rated the damages as “excessive and exorbitant.”

    He added: “It is worth mentioning that in challenging the award, the Federal Government relied upon an expert report analyzing the damages given to the P&ID. The expert concluded that the damages:

    • were clearly unreasonable and manifestly excessive and exorbitant;
    • went far beyond any legitimate protection of the commercial interest of the P&ID;
    • were completely wrong and obviously unjustifiable;
    • and that the damages overcompensated P&ID on a frankly gargantuan scale and imposed a punitive award on Nigeria.

    “It was on this ground and others that the Federal Government took all available steps to resist enforcement before the court of the United Kingdom (UK). Unfortunately, the UK Court has recognized the award and given the company the authorization to seize Nigeria’s assets.

    The information minister said the government had discovered that the contract was negotiated and signed in an underhanded manner.

    “In the first instance, the enforcement of the award cannot even commence now because the Judge in the UK court ordered that the P&ID cannot enforce the judgment against Nigeria until after the court resumes from its current vacation.

    “What this means is that enforcement action cannot begin until further hearing on the matter, which will take place on a date to be determined by the court upon its resumption.

    “The Federal Government therefore wishes to use this opportunity to assure Nigerians that there is no immediate threat to Nigeria’s assets as has been wrongly interpreted by a section of the media.”

    The Minister confirmed that the Federal Government will file an appeal against the judgment of the UK court, including seeking a stay of execution.

    He said: “Nigerians should be assured that the Federal Government is taking  all necessary steps to appeal the decision of the UK Court, to seek for a Stay of Execution of the decision, to defend its rights and to protect the assets of the people of the Federal Republic of Nigeria.

    “Nigerians should please be assured that the Federal Government will strongly avail itself of all defences customarily afforded to sovereign states under the United Kingdom Sovereign Immunity Act to stave off any enforcement of the award.

    Malami said: “The Criminal investigation relating thereto, has indeed become necessary in view of the certain antecedent relating to the contract in its own right and the eventual award.

    “Insinuations abound that the contract was originally designed to fail fundamentally against the background of the fact that there were inherent element of hitches that were designed into it right from conception.

    “When I talk of inherent element of hitches, I want to draw attention first to the fact that by the composition of the parties to the agreement there were two parties – the P&ID which is the company and the Federal Ministry of Petroleum Resources.

    “As you rightly know very well, Federal Ministry of Petroleum Resources is not a producer of gas. Gas products are produced by IOCs (International Oil Companies), Nigerian National Petroleum Corporation (NNPC).

    “So when you conceived, signed and executed a contract for the supply of gas products without involving IOCs, NPDC, and NNPC as a party to that agreement, you know very well that there are a lot of questions to answer arising from the execution of that agreement.

    “These among others gave rise to the insinuations or perhaps certain criminal and fraudulent conspiracies right from conception of the agreement.

  • The President and his women

    On August 21, President Muhammadu Buhari inaugurated his 43 team of Ministers, among them were seven women. In this report, Olayinka Oyegbile, Deputy Editor, profiles the women of history

    THE way women are regarded in the government of President Muhammadu Buhari has been ambivalent and unclear. He has many times run into storms of controversies concerning his perceived views of the womenfolk and his aides have had to issue statements trying to explain his stand. But the explanations most times clear no doubt in the minds of observers. However, the most telling testament of his regime about his views on this may perhaps be his classic answer to a question while on a visit to Germany in 2016. He had been asked what his reaction was to the allegation that his government had been hijacked by a so-called cabal, an allegation that was equally echoed by his wife, Aisha.

    In reply to the question, President Buhari told the audience which included the German Chancellor Angela Merkel that “I don’t know which party my wife belongs to, but she belongs to my kitchen and my living room and the other room.” This response was greeted with shock not only because it was made abroad but because it was made in the presence of one of the world’s most powerful women! This has today become a butt of many jokes at public functions by citizens and stand up comedians.

    Last week therefore when the president constituted his cabinet the focus was on the women who made the team. In the last cabinet there were only six women, while this time around despite the increase in the number of cabinet ministers, the women folk was only able to add one: they now have seven slots in 43.

    In fairness to the president, he never at anytime promised to make any appointment to favour women more than others. However, in November 2018, in the run-up to the election, the President Muhammadu Buhari Campaign Organisation had promised 35 per cent participation of women in the Federal Government if he was re-elected. The organisation, had as part of events to officially launch the President’s 2019 campaign tagged ‘Next Level’ listed its promises in a chart titled ‘Next Level road map’ via a Twitter handle, @TheNextLevelNG.

    However, on July 23 when President Buhari sent his list of ministers-designate to the Senate, there were only seven women on the list. These were Hajia Sadiya Umar-Farouk, Hajia Maryam Katagum, Mrs. Sharon Ikeazor and Senator Gbemi Saraki. Others were Ramatu Tijjani, Dame Pauline Tallen and Hajia Zenaib Ahmed, who is not new in the cabinet. She is playing along in the second coming of the president, but this time more powerful. All the other six women are new in the federal cabinet except Tallen who was a minister of state during former President Olusegun Obasanjo’s first coming in 1999.

    THE PRESIDENT’S NEW WOMEN ARE:

    ZAINAB AHMED

    She is unarguably the most powerful woman, if not minister, in the new dispensation. As minister of Finance, Budget and Planning, she is returning to a familiar turf. The trained accountant first made her way into the cabinet in 2015 when she was appointed as the Minister of State for Budget and National Planning. In September last year, she stepped in as substantive Minister of Finance when the former occupant Mrs. Kemi Adeosun, who had been embroiled in an alleged forged National Youth Service Corps discharge certificate scandal unceremoniously resigned and went back to England.

    Ahmed who hails from Kaduna State, had her secondary school education at Queen Amina College, Kaduna, and got her Accounting degree from Ahmadu Bello University in 1981. She from there proceeded to the then Ogun State University, Ago Iwoye; now Olabisi Onabanjo University for her MBA. Since she is coming in not as a fresher and with a three-barrelled portfolio, she is expected to be a formidable force in the formation of monetary, budgetary and planning policies of the federal government. She has a minister of state for buget in Clement Agba.

    SADIYA UMAR FAROUQ

    She is making her debut in the cabinet as Minister of Humanitarian Affairs, Disaster Management and Social Development. In view of the level of conflicts that have seized the country at its jugular in recent times, the creation of this ministry is coming at the right time. There have been Boko Haram killings leading to the proliferation of Internally Displaced Persons (IDPs) and camps, which have brought untold hardship to citizens.

    Farouq is coming from a background that eminently qualifies her for this new assignment. She is a former Federal Commissioner, National Commission for Refugees, Migrants and Internally Displaced Persons (NCFRMI). At the commission, she was reputed to have developed a strategic roadmap of action to reposition the Commission as a government agency responsible for coordination, protection and assistance of persons of concern.

    The road map is to draw up modalities for assisting those in distress. The indigene of Zamfara State is also an alumnus of Ahmadu Bello University, Zaria. She holds the university’s Bachelor of Science degree in Business Administration, specialising in Actuarial Science. She also holds the institution’s two Master’s degrees in International Affairs and Diplomacy as well as in Business Administration (MBA).

    MRS MARIAM YALWAJI KATAGUM

    The new Minister of State in the Ministry of Industry, Trade and Investment was until her appointment an Ambassador, Permanent Delegate of Nigeria to UNESCO, the world cultural and education body. She was appointed as Permanent Delegate of Nigeria to UNESCO in June 2009.  The widely experienced diplomat has served on a number of national and international committees and panels. These include as a Member of the Board of Trustees of the African World Heritage Fund (2009  2011); Chairperson of the West Africa Group in UNESCO (2009-2012); Chair of the E-9 Group at UNESCO (2010-2012); Member, representing Nigeria, on the UNESCO Headquarters’ Committee (2011-2013); Temporary Chairperson of the PX Commission of the Executive Board, 191st Session (2013) and Chairperson of the Preparatory Group, of the  Executive Board, 197th Session (2015).

    She is also an alumnus of both Ahmadu Bello University, Zaria and University of Lagos with a Bachelor of Arts (B.A.) in English, a Graduate Certificate in Education and Masters in Administration and Planning, respectively. She has served as Member and Deputy Chair of the Board of Governors of the Commonwealth of Learning (COL) and Member, representing Nigeria on the UNESCO Executive Board.

    SHARON IKEAZOR

    Posted to the Ministry of Environment as a Minister of State, Ikeazor was until her new placement the Executive Secretary of Pension Transitional Arrangement Directorate (PTAD). She was appointed in September 2016.  The University of Benin trained lawyer is reputed to have bagged the appointment based on her sterling performance at PTAD.

    Despite her new assignment at the Environment Ministry, she recently promised that, “If one pensioner complains to me, I will blow the alarm and we have to continue doing that work. To the pensioners, let me say that you now have a voice at the Federal Executive Council. I may be at the Ministry of Environment. But Pension issues, whether Military of Civil, I am still madam pension. My father taught us to hate injustice and fight against social injustice. Non payment of pension after a man or woman has worked several years is grave social injustice.”

    At her new ministry she has to fight for environmental justice for the whole country.

    GBEMI SARAKI

    Senator Gbemi Saraki is a scion of the powerful Saraki dynasty of Kwara State. Against the run of play, she lined up against her brother, former Senate President Bukola Saraki, to join the All Progressives Congress’ (APC) whirlwind of O to ge (Enough is enough) that dislodged the hold of her family’s political structure in the state. She is to function as minister of State in the Transport Ministry.

    She attended University of Sussex, United Kingdom and holds a Bachelor’s degree in Economics. In 1999, she was elected into the House of Representatives to represent Asa/Ilorin West Federal Constituency, Kwara State.

    She is reputed to be one of the most philanthropic politicians from the north central on the account of the number of people whom she had awarded scholarships. She is a grassroots mobiliser and manager of resources, an asset that would serve her well in her new ministry.

    RAMATU TIJANI

    The new Minister of State at the Federal Capital Territory Ministry is coming to her new assignment with a solid pedigree. A banker of many years, she is an alumnus of Ahmadu Bello University. She has a first degree in Urban and Regional Planning, and Masters Degree in Public Administration from Nasarawa State University, Keffi. With her background in urban and regional planning coupled with public administration, the former All Progressives Congress (APC) National Woman Leader is expected to function flawlessly in her new assignment. She has lived for long in the federal capital territory and this is expected to inform her duties to make the city better. She is also currently doing her Ph.D in Security and Strategic Studies.

    PAULINE TALLEN

    Mrs. Tallen designated as Minister of Women Affairs and Social Development is making her way back to the federal cabinet for a second time. In 1999, she was Minister of State for Science and Technology during the first tenure of former President Olusegun Obasanjo. In 2007 she became Deputy Governor of Plateau State, thus becoming the first woman to hold such a post in the north. In 2011, she contested the governorship seat against former governor Jonah Jang and lost.

    She is immensely popular in the state, especially in the fractious Jos North local government which was a hotbed of crises during the tenure of Jang. In fact, it was reported that in the heat of one of the crises in the local government, she was the only government official who visited the place and was welcome by the warring parties with open arms. She is reputed to be a bridge builder and peace maker extraordinaire. She is a graduate of Sociology from the University of Jos. The one-time commissioner is not new to administration. She is also a close friend of the president’s wife.

    Speaking during her maiden visit to the ministry after being sworn in, she said, “This is a holistic ministry as the woman takes care of the home, children and husband. I am giving you all a charge that things will be done different henceforth. We are all resolved to work as a team from our recent retreat. This ministry is multi faceted and has a lot of responsibility to touch the lives of the vulnerable. We have the mandate to of the ministry and demand of the president.”

    SHE SURELY HAS HER PLATE FULL.

    THE TASKS AHEAD

    These seven women who have been saddled by the president among a majority of men to walk along with him to deliver the much talked about NEXT LEVEL of the administration, are really going to be under pressure to deliver and show that the place of women is not only in the “other room” but at executive and policy tables. The tasks ahead of them are no doubt enormous and herculean.

  • Mohammed, Fashola, Onu set to retain cabinet seats

    There were strong indications last night that between 12 and 15 ex-ministers will join President Muhammadu Buhari’s cabinet.

    It was learnt that the ex-ministers’ names are on the list which was reportedly submitted to Senate President Ahmed  Lawan on Wednesday.

    But there was still a pall of uncertainty on the size of the cabinet.

    The President has the constitutional right to have a 36-man or a 42-man cabinet.

    The President is said to have decided to retain some of the ex-ministers on merit.

    Those speculated to be on the list last night are ex-Ministers of Justice and AGF Abubakar Malami ( SAN); Adamu Adamu( Education); Hadi Sirika ( Aviation); Zainab Ahmed (Finance); Aisha Abubakar (Women Affairs); Lai Mohammed ( Information); Babatunde Fashola (Works, Power and Housing); Rotimi Amaechi (Transportation); Mohammed Musa Bello( FCT); Suleiman Adamu Kazaure (Water Resources); Dr. Ogbonnaya Onu (Science & Technology); Solomon Dalung (Sports & Youths Development) and others.

    Although Dr. Ibe Kachikwu, former governors Rauf Aregbesola (Osun), Niyi Adebayo (Ekiti) and Akinwumi Ambode (Lagos) were also being speculated last night to have made the list, none of our sources could confirm such speculations.

    The sources confirmed that some ex-ministers, such as Adebayo Shittu (Communications) and Okechukwu Enelamah (Trade and Industry) lost the battle to return to the cabinet.

    A government source said: “I know that the two women ex-ministers are returning to the cabinet. We have a few others who have really added value that the President will be retaining.

    “It is not a total overhaul, which you are anticipating. What the President promised was to leave sustainable legacies in his second term.”

    Read Also: Breaking: Buhari to submit ministerial list this week

    As of press time, it was difficult to ascertain whether or not the President of the Senate had received the ministerial list.

    A principal officer of the National Assembly said “Lawan dropped a hint that he will receive the list on Wednesday”.

    Another source said: “I think the list is already with the Senate President and some officers but they said it will not be made public until Thursday.”

    A source in the Presidency simply said: “All things being equal, the Senate will receive the list on Thursday morning. “

    It was uncertain whether or not the President will retain the 36- member cabinet in his first term or expand it.

    Section 147(1-3), provides that the President should have no fewer than 36 ministers at one per state.

    The section reads:   “There shall be such offices of Ministers of the Government of the Federation as may be established by the President.

    “Any appointment to the office of Minister of the Government of the Federation shall, if the nomination of any person to such office is confirmed by the Senate, be made by the President.

    “Any appointment under Subsection (2) of this section by the President shall be in conformity with the provisions of Section 14(3) of this Constitution:

    ”Provided that in giving effect to the Provisions aforesaid the President shall appoint at least one Minister from each state, who shall be an indigene of such state.”

    Lawan confirmed on Wednesday that the list of ministers will be out this week.

    President Buhari had promised to appoint into his cabinet those who would help him to implement his “Next Level” programmes.

    Lawan spoke during plenary on Wednesday, following a Point of Order by Senator Albert Bassey Akpan (Akwa Ibom Northeast).

    Akpan, who spoke under personal explanation, prayed the Senate to mount pressure on Buhari to transmit the list to the chamber.

    The senator reminded his colleagues that the Senate would embark on its annual recess within the next two weeks.

    He stressed the need for Buhari to transmit the list before the recess.

    Akpan said: “Mr. President, in view of the yearly long recess the Senate and the House of Representatives will embark upon in two weeks, there is need to urge President Muhammadu Buhari to forward the much expected ministerial list to the Senate for screening and confirmation.

    “This is very important because if such list is not made available for the required legislative attention before we embark on the long recess, there will be no ministers and, by extension, the federal cabinet for the President to work with till September.

    “Making the list more urgent now from the President before our long recess, is the fact that if it is not made available, the concerted effort being made by both arms of government to return to the yearly budget cycle of January to December will be defeated.

    “On this note, I call on the President of the Senate to inform President Muhammadu Buhari of the need for the ministerial list before we embark on recess.”

    Lawan said: “Let me, on the strength of this motion, inform the Senate that the Executive arm of government is working very hard on the ministerial list.

    “In fact, the list, based on information at my disposal, will be forwarded to us by the President before the end of this week.

    “May I, therefore, appeal to us all to be ready to make the necessary sacrifice in terms of sufficient time to be spent in carrying out thorough screening and confirmation of appointments of the expected ministerial nominees.”

  • FG releases final N22.6b NAL Pensioners entitlements

    The Federal Government has approved the release of N22.6 billion balance to pensioners of the defunct Nigeria Airways Limited.

    This was announced by the Permanent Secretary Special Duties in the Ministry of Finance, Dr. Mohammed K. Dikwa, while calming restive pensioners who held former Finance Minister Mrs. Zainab Ahmed ‘captive’ for hours in her office on Tuesday.

    Dikwa said that communication lapses between his office, the Presidential Initiative on Continuous Audit (PICA) and pensioners led to the embarrassment visited on the former minister by the protesting retirees.

    Though the verification and data capturing of the NAL pensioners was supposed to start by 10am and terminate by 2pm, the exercise eventually kicked-off by 2pm after some complaints by the pensioners.

    Read Also: Call minister to order, pensioners’ union tells Buhari

    The pensioners were worried that the delayed kickoff might lead to some of them not being captured on Wednesday, thereby, forcing them to incur more expenses by passing the night in Abuja.

    The verification was, however, peaceful.

    Chairman of the NAL chapter of the Nigeria Union of Pensioners (NUP), Sam Nzene, alleged that the consultant who was to conduct the screening disappeared.

    He told reporters that the consultant claimed that his contract had not been regularised and that government had not paid him.   Before signing out on Tuesday, Mrs. Ahmed held separate meetings with directors and heads of parastatals under her ministry.