Tinubu Made The Impossible Happen, Fashola Says In Birthday Tribute To APC Leader

The Minister of Power, Works and Housing, Mr. Babatunde Fashola (SAN), says the National Leader of the All Progressives Congress, Asiwaju Bola Tinubu, made the impossible happen by ensuring that for the first time in Nigeria’s history, opposition parties successfully merged.

Fashola said this in a video tribute to commemorate Tinubu’s 64th birthday.

The minister, who was present at the colloquium held in Tinubu’s honour in Abuja, on Tuesday, said Nigeria was falling apart under former President Goodluck Jonathan, adding that Tinubu steered Nigeria away from the course of destruction.

Fashola said, “It was dangerous for Nigeria to keep that administration for another term and the evidence of that was before us. The country was falling apart. You must salute the courage, the passion, the foresight of Asiwaju to reach across and say ‘let us forge a partnership to save Nigerians, to save ourselves’.”

The minister added, “On whether or not there could be a merger, everyone said it wasn’t going to happen, it had never happened in the history of Nigeria and as far as that was concerned, it (the merger) was a victory that the impossible had become not only probable but possible and that was due to Asiwaju’s self conviction and, as I said, his ability to mobilise people and materials behind an idea.”

FG Plans To Generate 4,000MW With Nuclear Energy

President Muhammadu Buhari has appreciated the support of the International Atomic Energy Agency, IAEA, for Nigeria’s quest to generate 4,000 megawatts of electricity using nuclear energy.

This came as Ministers of Power, Solid Minerals, Health, Science and Technology told President Buhari that Nigeria would soon start a program that will help the country realize the objective.

According to them, it will commerce with 1000MW of electricity in the first instance and increased later to 4,000 megawatts.

The ministers told the President that preparatory steps had been taken to train doctors and other medical specialists to prepare for unforeseen circumstances, establish specialist medical centres and procure necessary equipment aimed at protecting the health of the citizens.

Speaking while receiving Mr. Yukiya Amano, the Director-General of the IAEA at the presidential villa yesterday, President Buhari said he was happy that the organization was developing a program from which Nigeria would benefit.

President Buhari charged the IAEA to do more to support Nigeria, in view of the long years of its association and support for the nuclear regulatory agency.

The meeting which had the ministers also attracted the presence of the Vice President, Yemi Osinabjo.

Addressing the President, Mr. Amano said he was pleased to see that Nigeria was taking the correct steps toward a safe usage of nuclear energy for peaceful purposes.

FG Concludes Framework To Add 1,286MW To National Grid Via Solar Energy

The Minister of Power, Works and Housing, Mr. Babatunde Fashola (SAN), yesterday, revealed that the ministry has concluded the framework for the approval for 14 major solar projects which put together will generate about 1,286 megawatts for the country.

The Minister made this known while speaking alongside the Minister of Environment, Mrs Amina Mohammed, at a meeting with the French Minister of Environment, Energy and Marine Affairs with her delegation at the ministry’s headquarters in Abuja.

According to him, the framework which is the first phase provides the forerunner for the financial agreement upon which others would move forward.
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Meanwhile, the Director-General, Energy Commission of Nigeria (ECN), Engr Eli Jidere Bala, has revealed that Nigeria needed to generate 300, 000 Megawatts of electricity by 2030 to sustain it’s energy demand and supply adding that Sustainable Development Goals (SDG’s) 7 highlighted the need to ensure access to affordable, reliable, sustainable and modern energy for all by 2030.

He stated this in Abuja yesterday at the opening ceremony of a 2-day stakeholders workshop organised by the Nigeria Society of Engineers (NSE) with the theme, “Implementation of Sustainable Development Goals in Nigeria: Engineering Perspective”.

FG Orders Discos To Provide Meters To Nigerians

Nigeria’s minister of power, works and housing, Mr. Babatunde Fashola, on Monday in Enugu ordered power distribution companies to immediately supply metres to consumers.

This is also as the minister assured of the federal government’s commitment towards steady power supply across the country.

Fashola stated this in a Communique issued at the end of 3rd monthly sectoral meeting of operators in the electricity industry, held at Ugwuaji transmission station, Enugu.

The power stakeholders resolved to reinvigorate their efforts towards customer engagement, through the launching of customer care units, for adequate resolution of power sectors issues in line with the standard set up by NERC.

Fashola, who briefed newsmen shortly after the meeting, however, expressed optimism that the present challenge militating against the supply of electricity in the country would be surmounted once Nigerians understood how the system operates.

He said, “Every time that we finish the meeting, one questions that we ask ourselves is whether the meeting has added value to the business and help to solve some of their problems, the result was a unanimous yes.

“In terms of specifics, the meeting addressed the problems of gas, financial stability, volatility of foreign exchange in sectors as to how that affects the ability of the power plants, the GenCos, the DisCos to implement their technical service agreement with their foreign partners, it addressed also the difficulty of pricing local gas consumption in dollars instead of naira.

“So, these are some of the problems that people don’t see but they ultimately affect the value of service.

“We also addressed the problem of CAPMI metering system, we resolved that in the interest of consumers that people cannot take money from consumers without supplying what was paid for; we’ve reviewed the reports given to us by the discos, from the reports, many of them claimed that they’ve largely supplied the metters that people paid in advance for.

“I made it clear to them that a situation where people pay for metres and they are not supplied, for me undermines trust, we’ve given them matching orders to wind down all the outstanding credit meters programme that they’ve collected money from people and haven’t supplied.

“Going forward, they must take responsibility for providing meters because that is what is in the new tarriffs that they have. That’s also the protection we’ve given to consumers in the new tarrif. We’ve made it clear that if you dispute your bill based on assessment, then, you should pay your last undisputed bill, let the distribution company who claimed that you consumed more energy come and prove that you did so. They cannot do so unless they measure the energy and they cannot measure the energy unless they give you a meter.

“Any fair minded person who reads through the new tarriff order will see that it has favoured the consumers more and placed the burden on the discos to provide the meters,” he said.

Also speaking, the Managing Director of the Enugu Electricity Distribution Company, Robert Dickerman said the company was ready to distribute as much energy as it accesses from the transmission company, noting however that there is a severe shortage of generation at the moment.

On his part, the Acting CEO of the Nigeria Electricity Regulatory Commission (NERC), Dr Anthony Akah said the sectoral meeting had been able to streamline most of the bottlenecks that have militated against the speedy improvement in power supply and also addressed some multi-agency issue.

We’ll Pay States For Verified Road Projects – Fashola

The Minister of Power, Works and Housing, Mr. Babatunde Fashola, on Tuesday said President Muhammadu Buhari had established an inter-ministerial committee to verify claims by state governments of money spent on federal roads.

He stated that the Federal Government would reimburse state governments once their claims were verified.

According to him, the Federal Government has commenced the verification of all federal roads constructed by the Kwara State Government for possible reimbursement.

He spoke when he paid a courtesy call on the Kwara State Governor, Alhaji Abdulfatah Ahmed, in Ilorin.

For instance, Fashola said the Federal Government had identified Jebba-Ilorin Road as one of the most strategic economic corridors in Nigeria that required urgent attention.

He added that the Federal Government was making efforts to restore normalcy to the road in view of its strategic importance.

Ahmed called for more support from the Federal Government in the area of infrastructural development, especially federal roads in the state.

He added that the intervention of the Federal Government on federal roads would ensure cost savings for the state government in addressing other projects left untouched.

Ahmed pleaded with the Federal Government to hasten work on Ilorin-Ogbomosho-Oyo-Ibadan road as well as Jebba-Ilorin road to ease the movement of people and goods from the North to the South-West.

He said, “The issues of road and energy are very germane to our growth and development.”

The governor said the state government was ready to allocate land in the urban and other developing areas for the development of the Federal Government housing scheme.

Punch

Retain My Budget Plan – Fashola Begs Senators

The Minister of Power, Works and Housing, Mr. Babatunde Fashola SAN on Wednesday led the management team of his Ministry at the 2016 Budget Defence Session of the Senate Committee on Works with a passionate appeal that the focus and plan of the proposed plans be retained in order to achieve the much desired change and positive objectives of the Budget.

The Minister in his presentation of the main thrust of the Medium Term Sector Strategy 2016 – 2018 Budget proposals of his Ministry explained that the objective is to ensure that on going projects in the six geopolitical zones of the country are completed within the shortest possible time as distinct from the practice in the past, where the inadequate budgetary provision is spread thin over so many projects without much being completed.

According to Fashola, economic roads that will ensure connectivity between hubs of commerce and generate employment; roads bearing the heaviest traffic and those nearing completion are being given priority over the next three budget cycles, urging the Senate to trust him and the Ministry to deliver the desired objectives by not changing the proposed plans.

From the proposals, the first priority projects envisaged for the 2016 Budget are those on arterial highways and major river crossings which carry high volume of traffic and are critical to the economic well-being of the country with a total length of 2,192.76 km, distributed across the various zones.

“Some members of the Committee, have of course, pointed out that they wanted to see a plan. There is a plan before you and it is a plan that I appeal that you should kindly look at in more detail. It is perhaps different from what has been done before, and if we have done this budget method where we put X Naira in the Budget and every constituency takes a part of it in that Budget year and it doesn’t lead us to the conclusion of a project, I think the time has come to try something new,” he said.

Continuing the Minister explained the essence of the new approach thus: “I am proposing something new but we are not inflexible about what we are proposing and as I have said in my previous meetings with the Chairman and the Vice Chairman, give us a chance, to change the way things have been done, then hold us responsible to the plan that we mutually agree with. But as Parliament, when it comes to Budgetary Appropriation matters clearly you have the yam and you have the knives and you can choose to cut as you wish Sir. Mr. Chairman, we have brought a plan to you Sir, it is different from what has been done before. The purpose of that plan is to address first, economic roads like the Second Niger Bridge, the Lagos – Ibadan Expressway, the Ilorin – Jebba road so that, a section at least can be completed.”

Acknowledging that every Lawmaker was entitled to make a case for his or her constituents, Fashola noted that if there was a clear cut plan as currently being proposed, each lawmaker could with some certainty explain to their people on the schedule of their areas within such a plan.

Explaining that it was practically impossible to have come up with a 10 – year plan in less than 100 Days of being in Office as suggested by one of the Senators, the Minister explained that it was important to come up with a practical proposal for implementation to avoid the danger of losing the entire dry weather while making elaborate plans.

Fashola noted that the time had come for the Senators to insist on what will make meaningful impact in the life of the citizenry by endorsing the Ministry’s proposal unlike what was done in the past.

“Let us also not forget that there are some contractors who were at work last year. The Budget of N19 billion passed through this National Assembly last year, l wasn’t here then. And perhaps that was the time to have put our foot down. We have another opportunity now to put our foot down and l hope that we do not miss it. In doing so my suggestion is that you trust us with this plan and you hold us to it subject to modifications that we may make and subject to the leadership responsibility that we will take in our various constituencies that next year, this is what will happen in this part of the country, in year three, this is what will happen in this part of the country, “he said.

Noting that such predictability would make for consistency, the Minister said such a plan if followed would also be in tune with the request for a 10 – year plan earlier made by a Senator.

“We can’t all be served at the same time, that really is the truth of the matter. Even if we are at a party, the stewards cannot serve all of us at the same time. They would normally start from somewhere, one end of the table until the food gets round. The choice for us to go and take the food from the service point means that we may not eat comfortably or that we may get rice and we may not get water. As leaders, our people are agitating, l understand it all too clearly but it is as leaders that we must all go back to them and explain that we are changing the plans slightly for better results”, Fashola said.

He added, however, that constituencies who are not benefiting in terms of roads could still be served by the other mandates of the Ministry. “Where we are not intervening in roads this year, we are probably intervening in Power or we are probably intervening in Housing, so there will be some service to one’s constituency. Where we are not immediately active, may be transportation is building a rail along that corridor and how we harmonise these is really the important thing”.

Explaining that the priority projects being proposed in the three cycles of the Ministry’s Budget had been considered at the Federal Executive Council, the Minister was certain that if approved, every geographical zone of the Country would be served in each of the Budget cycles.

Enumerating some of the economic roads to be accommodated immediately as the second Niger Bridge and the road leading from the Murtala International Airport in Lagos, Fashola said such roads would help revive the employment of workers who had been sacked when the contractors handling them demobilised from site.

He also explained that the plan was to strengthen the Federal Roads Maintenance Agency (FERMA) to become the biggest construction outfit for government and therefore capable of handling some of the projects being contracted out.

According to him, the Agency would also be able to carry out maintenance work on some of the sections of the road in a State of disrepair before major construction work can be done on them.

While rounding off the session, the Chairman of the Senate Committee on Works, Senator Kabiru Gaya commended the Minister and his team for the depth of work done within a short period to produce the proposal which seeks to do things differently and promised that his Committee would work with the Ministry to come up with a final Budget that will help achieve the desired objectives of both the Executive and the legislature.

PM News

FG To Complete 200 Roads Awarded By Jonathan – Fashola

OVER 200 roads worth N2 trillion awarded by the Goodluck Jonathan administration will be completed across the country this year, it was learnt.

Minister of Power, Works and Housing Mr. Babatunde Fashola said this at a budget session with the House of Represdentatives’ committees on Power, Works and Housing and FERMA.

He told the committees, led by  Toby Okechukwu, that the government owes road contractors over N1 trillion.

The minister said 206 projects were in diverse stages of completion, while contractors, consultants for engineering design and supervision consultants, etc. have not been paid.

On the 2016 budget proposal, Fashola said of the N433 billion proposed for the three critical sectors, N208 billion is for roads, N99 billion for power and N66 billion for housing.

The challenges of the ministry as regards the timely completion of projects, Fashola said, “is inadequate budgetary provision for projects to sustain annual cashflow requirement levels.

“This underscores the need for diversifying the sources of funding highway projects.”

He presented a three-year plan (2016-2018) for the completion of major economic roads linking different states and regions, totalling over 6,000 kilometres.

He said some of the priority roads included: Sokoto-Kantagora-Makera Road, Katsina-Kano-Maidugari road, Hadeja-Nguru-Gashua Road, Ilorin-Jebba-Makowa, Lagos-Ibadan road, Enugu-Portharcourt, Calabar-Adokpani-Ikot road and Ajibandele-Sagamu road.

On the delay in the completion of the Lagos-Ibadan Express road, the minister blamed the concession agreement between the Federal Government and Bi-Courtney Limited, which he described as “problematic”.

Two court orders obtained  by Bi-Courtney have stalled the project, he said.

His words:  “The brief I have received was first, there was documented advice to government, that they should have never issued that concession. But government went ahead to issue and this perhaps explains the inability to perform.

“So many other things happened, like a change of government. But the last administration took the view that they wanted out of the concession and the company went to court seeking to be compensated and that the concession be restored.

“While that was going on government set up a finance, corporate and management agreement and that’s where Motorways came in. Money was raised by Motorways to fund the contractors, RCC and Julius Berger. Again, Bi-Courtney instituted went to court and got an order stopping any of the lenders under the Motorways contract…”

Okechukwu said there should be creative ways of funding important road projects and its time the ministry started thinking outside the box.

The Nation

Photonews: Fashola On Tour Of Ministry’s Projects In The North Central

Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (right) and the Minister of State in the Ministry, Hon. Mustapha Baba Shehuri (left) being shown the progress of work on the on going Abuja-Abaji-Lokoja road by the Director, Federal Highways (North Central), Engr. A.M Gambo (2nd left) during the inspection, verification and fact finding tour of the Ministry's projects in the North Central Zone as part of the nationwide tour of projects on Monday, 25th January 2016.
Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (right) and the Minister of State in the Ministry, Hon. Mustapha Baba Shehuri (left) being shown the progress of work on the on going Abuja-Abaji-Lokoja road by the Director, Federal Highways (North Central), Engr. A.M Gambo (2nd left) during the inspection, verification and fact finding tour of the Ministry’s projects in the North Central Zone as part of the nationwide tour of projects on Monday, 25th January 2016.
Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (right) being shown the progress of work on the ongoing Abuja-Abaji-  Lokoja road by the Director, Federal Highways (North Central) , Engr. A. M Gambo, during the inspection , verification and fact finding tour of the Ministry's projects in the North Central Zone as part of the nationwide tour of projects on Monday, 25th January 2016.
Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (2ndleft), the Minister of State in the Ministry, Hon. Mustapha Baba Shehuri (middle) and a Director in the Ministry, Engnr. Adebisi watch with keen interest as the Shift lead, Engr. Wasiu Olatunji, (left), explain the operations of the Control Room at the Geregu II Power Plant, Kogi State during the ongoing inspection , verification and fact finding tour of the Ministry’s projects in the North Central Zone as part of a nationwide tour of projects on Monday, 25th January 2016.
 Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (2ndleft), the Minister of State in the Ministry, Hon. Mustapha Baba Shehuri (middle) and a Director in the Ministry, Engnr. Adebisi watch with keen interest as the Shift lead, Engr. Wasiu Olatunji, (left), explain the operations of the Control Room at the Geregu II Power Plant, Kogi State during the ongoing  inspection , verification and fact finding tour of the Ministry's projects in the North Central Zone as part of a nationwide tour of projects on Monday, 25th January 2016.
Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (right) being shown the progress of work on the ongoing Abuja-Abaji- Lokoja road by the Director, Federal Highways (North Central) , Engr. A. M Gambo, during the inspection , verification and fact finding tour of the Ministry’s projects in the North Central Zone as part of the nationwide tour of projects on Monday, 25th January 2016.
Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (left) being conducted round the Control Room of the Apir 330/132/33KV Transmission Station in Makurdi, Benue State by the System Operator, Mr E.N lke ,  during the  inspection, verification and fact finding tour of the Ministry's projects in the North Central Zone as part of a nationwide tour of projects on Tuesday, 26th January 2016.
Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (left) being conducted round the Control Room of the Apir 330/132/33KV Transmission Station in Makurdi, Benue State by the System Operator, Mr E.N lke , during the inspection, verification and fact finding tour of the Ministry’s projects in the North Central Zone as part of a nationwide tour of projects on Tuesday, 26th January 2016.
Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (left) being conducted round the Control Room of the Apir 330/132/33KV Transmission Station in Makurdi, Benue State by the System Operator, Mr E.N lke ,  during the  inspection, verification and fact finding tour of the Ministry's projects in the North Central Zone as part of a nationwide tour of projects on Tuesday, 26th January 2016.
Hon. Minister of Power, Works & Housing, Mr Babatunde Fashola, SAN (2ndleft), the Minister of State in the Ministry, Hon. Mustapha Baba Shehuri (behind) watch with keen interest as the Shift lead, Engr. Wasiu Olatunji, (left), explain the operations of the Control Room at the Geregu II Power Plant, Kogi State during the ongoing inspection , verification and fact finding tour of the Ministry’s projects in the North Central Zone as part of a nationwide tour of projects on Monday, 25th January 2016.

Keynote Speech At The Nigerian Pension Industry Strategy Implementation Roadmap Retreat By Babatunde Fashola

KEYNOTE SPEECH AT THE NIGERIAN PENSION INDUSTRY STRATEGY IMPLEMENTATION ROADMAP RETREAT ON JANUARY 21-23, 2016

Ladies and Gentlemen, we are gathered at a historic time to discuss an important matter.

Some may see a Pension Conference, but I see more.

I see a future for Africa, led by Nigeria, using the resources of the people to build a future that includes the people.

It is not a vision or an idea. It has gone beyond that. It is a journey, one that started a while ago when the Pension Reform Act was signed into Law.

That journey started with the coming together of some Nigerian minds. Minds like that of  President Olusegun Obasanjo and Mr Fola Adeola. It has been nurtured by the dedicated hands of men and women who have served in the pension commission who are represented by the current Director- General Mrs Chinelo Amazu- Anohu.  It has reached a major milestone from where it must reinvigorate itself .

The tools for that reinvigoration have been provided by our legislators in the Amendment they passed into in 2014. The success of this phase of the journey now rests with you and I. And this is why we gather.

In the letter of the Pension Commission inviting me to be a Keynote Speaker at this event, no topic was assigned.

However, some paragraphs of the letter which I have excerpted provide some directions as to the thinking of the organizers and I will share them with you:

a              “Two of the most strategic themes, positive that returns (on investment) and visible (measurable) impact on the economy”

b.            “creating solutions to the binding constraints that Nigeria faces in developing “bankable projects” in infrastructure and real estate that pension funds can invest in…”

c.             “While the pool of Pension Funds are a veritable source of capital, lack of suitable investable vehicles with low risk profiles and sufficient comfort continues to hamper the drive to make visible economic impact”

It seems to me that the key words such as “positive real returns”, “visible impact on the economy”, “bankable products…that pension funds can invest in”, “low risk profile and sufficient comfort” makes it easy to create my own topic “Overcoming the Challenges and Managing the Risks and Constraints that Inhibit the Investment of Private Capital and Funds in Nigeria’s Infrastructure Landscape in Order to Make a Visible Economic Impact”.

In seeking to address this topic, which I hope accords with the objective of the organizers, I will attempt to be empirical by a case study discussion where I will review some of the public infrastructure that have been funded by private capital, and I will do some comparisons of what the Pension Funds are achieving in other economies.

In this way, I hope to highlight the differences between us and those economies, and in that way, make my recommendations about what we should be doing.

The History of Pension Funds in Nigeria

It is impossible in this kind of forum to exhaustively deal with the issue of Pension Funds and its management in the Nigerian public service.

What is appropriate is to highlight the largely unsuccessful initiatives that have been characterized by such brand names as the National Provident Fund (NPF) and the National Social Insurance Trust Fund (NSITF).

Those brands represent the era when pension was only the responsibility of the employer,

What simply happened was that from a failure of governance, coupled with lack of funds as a result of planning deficiency, and sometimes incompetence, pensioners faced a life of uncertainty after a lifetime of service and at a time when they had become frail, unable to work or earn income and often then left disappointed by a system that had taken all they had to give.

It is sad a story that is written on so many faces characterized by many living and dead people whose lives tell the story of anguish.

It is a chapter of Nigeria’s story that is perhaps best forgotten, but regrettably they cannot yet be consigned to history because there are still debts to be paid, there are still beneficiaries who are owed, there are still Nigerians, who gave a lot, almost everything under a defined benefit scheme that is yet to give them benefit.

The current pension regime, whose managers are the organizers of this event happily have a better story to tell. It is a story of mutual contribution, where the employee and the employer share the responsibility of planning for the tomorrow.

It is a story different from the past, where the funds are safe and have exceeded N5 Trillion.

It is a story of better management.

It is the starting point for this discussion because there is a hard lesson here.

If people put their money into what they believe in, it is likely to serve them better.

The old scheme where there was no contribution by the employee perhaps reduced their role as stakeholders but does not justify the mismanagement.

But the real story is about contribution, paying your share; and it takes me to the next point which is diversification and the relevance of diversification to our subject.

Diversification

For over 3 (Three) decades we have mouthed the need to diversify our economy in order to open up more sectors for productive activities, income, economic growth and jobs.

But we failed to follow through because of oil resources. It was quick and bountiful income even though there were boom and burst cycles.

Every time the cycle burst, we scampered, and promised to diversify, we take tentative steps, we feel pain. We do not endure, and it is easy to escape because not too far on the horizon is a boom in oil prices and we go back to an old life.

Remember 1970s up to 1976; remember the early 1980s and the burst. Remember the late eighties and Gulf War boom, remember the 1990s and the drop, remember the period of 2009-2014 when oil sold for over $100 per barrel for almost 5 years.

What did we do? We went on a spending spree. Politicians promised everything free.

Everyone got a wage increase, sometimes up to 80% (minimum wage from N7,500 – N10,000 raised to N18,000.00). Did our income as a Nation increased by 80%?

As we sought after free health, free education, free fuel, free housing and free everything, we refused to confront the reality that life is not free.

It was difficult to get private capital into critical sectors of our economy like infrastructure. Private capital and fund managers were not going to invest funds entrusted to them in infrastructure if we wanted to use them for free.

As a people, we were willing to pay for these services outside our country but demanded that they be provided for free in our country.

The new pension fund has shown what can happen if people resolve to contribute and pay their way.

Health insurance is another area that can open up access to top class health service for even the poor , if people are ready to contribute and save for their well being.

Insurance will give them a choice and access to the best medical service when they need it.

It will give them a second highway away from public health service, which even with its best intentions cannot provide every service free (examples).

But today’s reality is that we are in another cycle of burst. Oil prices have crashed from over $100 per barrel and is now hovering around $30 per barrel and there is a real chance that it will fall lower.

Put very simply, our main source of revenue has taken a big blow. This household has lost its bread winner.

However, it is not without options. It has assets, it can raise money, it has savings such as the private money belonging to pensioners, but it cannot be used like oil money.

Whatever is used must return.

This calls for a new attitude. There is no free money.

Ladies and gentlemen, I have news for you.

After 3 (three) decades of prevaricating about diversification, diversification has walked into the front door of the Nigerian household.

We must either embrace it, with a new attitude, or idle in agony and anguish until when hopefully the price of oil will rise again, as it will surely do.

The pension funds, which are under the management of pension funds administrators will not go into roads, rail, housing, hospitals or universities unless we change our attitude.

Attitude Change

As I said earlier, I intend to be empirical. So instead of prescribing what to do, I will simply share the experiences we are all familiar with and leave us with the options first to make rational choices, and also to be agents for change in the areas where we can influence others.

In the course of my public service, I have been privileged to be involved in getting private capital to operate in areas that were once the sole preserve of government and I will share the experiences and the results.

a.             Lekki-Epe Expressway

This is a 60km road in the eastern axis of Lagos State that was built in the 1970s and has scarcely seen any maintenance.

Potholes had taken over its surface, the population it was serving was growing daily and neither Lagos State Government had the funds to rebuild it and the Federal Government at the time was not interested even though oil income was increasing.

Accidents were claiming lives regularly and nothing seemed to offer a solution until the Lagos State Government in 2005 signed a concession with a private group of financiers.

They were very skeptical of many things not the least our political environment and behaviour.

We had previously nationalized assets of investors in the oil and gas sector and other sectors before.

Investors don’t like that and they don’t forget.

But their sense of entrepreneurship if nothing else, keeps them from staying away. In spite of risks they sometimes come back when they think the waters have calmed.

But they do so with conditions, which they hoped will mitigate risks, especially political risks.

They are used to and trained to deal with business risks, but often unprepared to deal with, and frequently unable to deal with politically induced risks.

In the Lekki-Expressway, after doing their traffic studies, satisfying themselves that the business was “bankable” (which is what the organizers of this event are looking for) they asked the Lagos State Government to pass a law; in effect to tie the hands of the next government that the concession will not be cancelled.

In other economies, a contract, which Lagos State Government gave them, would have been enough; however, as I said, investors never forget, so they asked for a law, which the State House of Assembly passed.

But when we thought that will suffice, they then asked for a “Federal Support Agreement”, which was akin to a sovereign guarantee.

Of course Lagos and the Federal Government at the time had different political colours and a Federal Support Agreement was delayed by politics for 3 years.

During that time, prices changed, exchange rates changed, many economic indices changed leading to cost impact, but eventually one was signed, during the tenure of President YarAdua.

This meant that with the Federal Support Agreement, Nigeria’s Sovereign credit rating had entered the equation.

Regrettably, when the road was finally built, and tolls were to be charged to repay the financiers, all sorts of informed and misinformed players took centre stage.

There was no resistance during the painful period of construction when children had to wake up at 4a.m to get to school at 8a.m. But as soon as the road was motorable and ready for use and Tolling , some sympathizers of the Federal Government of the day, on a political front mobilized resistance to the payment of tolls.

They promised that if they were elected, they will cancel the toll.

That is not good news to investors.

I got all sort of letters from around the world. Investors sent representatives from around the world to meet with us, asking what was happening.

All lies were told against our officials after the road was built.

But we were undeterred. We bore the lies. We managed the orchestrated protests. Some artistes were mobilized to pour red paint on their faces and posted these on the social media as evidence to incense people falsely that we had used violence to stop their protests.

One newspaper falsely and recklessly carried a headline that our government had killed a person protesting illegal tolls.

That was the first and only time I used the coercive power of the State.

We deployed Policemen to the toll plazas. They were instructed to allow protests which was legitimate, but they must also protect those who were not interested in protesting and wanted to pay tolls, because those who were opposed to paying had no right to obstruct those who wanted to pay.

We begged, pleaded and held meetings for understanding.

We explained that those of us who enunciated the policy were going to be affected by it as well. I drove through the toll and paid, to show this.

In all of this, my biggest concern was not the road , it was Nigeria’s credit rating and the need to ensure that the project did not fail.

What was at risk was now bigger than the road and the Lagos State Government. It was a national reputation in the international business climate.

I am happy to say that we preserved our country’s business integrity against all odds and I will do it again.

For me, the lesson of this story is that we must not play politics with our economic survival. Investors want continuity of policies, even if Government changes.

Our politics must therefore mature to the level where we must refrain from campaigns that threaten to cancel contracts. We will be poorer for it.

Even when we perceive that the government of the day has poorly negotiated a contract, threats of cancellation do not help.

What we may at the worst seek to do is to re-negotiate after elections are over where it is possible to do so.

If we compare the quality of service on the Lekki-Epe Expressway where toll is paid to the Lagos-Ibadan Expressway where toll has been removed, the choice is ours to make.

Is it cheaper to drive on a road free of toll, and spend 5 hours for a 1 (one) hour journey? If you calculate the fuel burnt in 5 hours of standstill traffic and the stress, you will see that the toll free is not free.

The Security Trust Fund

Another example of private capital in a public area reserved for government was in the area of security.

This is the primary responsibility of Government and it is not an area of return in CASH for private business. But still there were returns and I will demonstrate it.

Before we set up the Trust Fund in Lagos, there was a State Police Command of about 103 (One Hundred and Three) Divisions that were poorly resourced. No cars, no fuel, no uniforms etc.

Banks were robbed at least 3 (three) times a week without capacity for response either by the Command or by the Rapid Response Squad, which was the special unit set up to respond to violent crimes.

They often get to crime scenes after the crime had been completed and the criminals had left.

I found out that this was deliberate partly and unavoidable partly.

It was deliberate to the extent that in a 2,000 strong squad to protect 18 million people at the time, they had only 37 rifles.

It was unavoidable partly because they barely had a dozen vehicles in poor condition and there was no clear and predictable strategy to get fuel.

Businesses closed at 7p.m and there was barely a night economy. So people worked only during the day, if they could avoid getting robbed.

The injection of private capital to support the larger portion of funding provided by Government, the constitution of the Board of Trustees, dominated by the representatives of the donors, with a minority by Government, led to the procurement of 10 Armored Personnel Carriers, 5 pairs of uniforms for over 2,000 officers, bullet proof vests, 2,000 rifles, 2 million rounds of ammunitions, 200 patrol vehicles at start, a regime of 25 litres of fuel per day.

The results were astonishing. Crime reduced by over 80%, no bank robbery for 2 years, no successful bank robbery until 2015 (7 years after).

A bustling night economy of 24 hours petrol stations, drug stores, night clubs , hotels, supermarkets, shopping malls and hospitality facilities unfolded and provided jobs for thousands.

This was the real return for the business community.

It might interest you to learn that private capital has found a safe haven in the American prison service and in some states the prison service is the 5th largest employer of labour topping malls and supermarkets which come 7th in a survey of 20 highest employers. So if private capital is looking for where to put money apart from roads, hospitals and bridges in Nigeria, the prison system that is overcrowded, badly managed, and not reformative is one area I will recommend. Clothing, feeding, drugs, and pharmaceuticals are some of the spin-offs.

Education

Our “Adopt a School Initiative” where we opened a structured platform for private individuals, and corporations to enter into schools, which were hitherto the investment preserve of Government and religious missions (Christians and Muslims) is another area of our successful use of private capital coupled with government funding like the World Bank supported Eko Project.

The “Adopt a School Initiative” was so flexible that it allowed individuals and corporations to intervene according to their resources in a classroom or an entire school.

Nothing was too small. You could give cash or material or you could rebuild, refurbish or donate a school facility by yourself, once we reached an agreement with you.

Again the results were spectacular. From a result based performance where only 7% of students who sat for placement examination to universities and other tertiary institutions secured credits in 5 (five) subjects, numbers rose to 11%, 18%, 39%, 42% and 47% between 2009-2013.

The Lagos-Ibadan Expressway

The Lagos-Ibadan Expressway is a story of what investors don’t like.

The FGN granted a concession to a private company (Company A) and later withdrew and cancelled it.

The FGN then entered into a construction and financing agreement with another company (Company B).

Company A went to court and got an order to cancel the financing agreement made with Company B.

As things stand, work has been stopped on the construction of the road.

The construction companies cannot get financing because of the court order, so they have laid off about 2,000 Workers, in an economy that has so much to do and needs to create work.

These 2 (two) companies are Nigerian companies investing in Nigeria, which is a positive sign because the local investors are the most important to any economy.

Regrettably, while not going into the merits and demerits of the FGN’s cancellation of Company A’s “concession”, it sends a not welcoming message to foreign investors if the decision was without basis or influenced by politics, which I cannot comment upon.

If that was the case, as a foreign investor I will be asking myself the kind of treatment that awaits me as a foreigner if the Government does that to a citizen.

But that is only one half of the story.

The other half is judicial intervention in commercial cases.

Investors know that there will be disputes. They are used to it and that is why they insert Arbitration Clauses because they do not want disputes to drag too long in courts.

As far as the practice of law goes, my advise will be for judges called upon to decide commercial disputes to:

a.       Act in a commercial and expeditious manner;

b.       Refrain from granting injunctive orders that will stop the business. A worrisome number of power projects are caught up in protracted court cases while the nation waits for electricity to drive the economy;

c.         Focus on resolving the dispute without detriment to the business, and award damages instead to the injured party;

d.       Decline jurisdiction whenever there is an arbitration clause and refuse the invitation which is frequently made, to set aside arbitral awards unless there is a PATENT case for doing so;

e.       Nigerian judges must be encouraged to attend annual conferences of the International Bar Association whenever possible, because they offer very rich sessions in PPPs.

f.         We create a lot of arbitration businesses and opportunities, but we do not take the benefit of it because we have developed anti-business reputation for not respecting arbitral decisions;

g.       Nigerian universities, the Nigerian Law School and the National Judicial Institute must compulsorily teach the law and practice of Public Private Partnerships (PPPs) which is an emerging global area of practice.

Having completed my empirical effort at what has worked and what has not worked, I will review what some pension funds are delivering across the world.

Pension Funds in Africa

Perhaps the appropriate starting point will be to acknowledge that Pension Reforms are just beginning to gain foothold across most of Africa in jurisdictions like Nigeria, Ghana, Botswana, Kenya and Uganda to mention a few.

But perhaps the biggest and most advanced of the Pension Funds, especially in sub-saharan Africa is the South African Pension Fund.

But while the sizes of these funds are happily growing, and the number of contributors is increasing, the impact in the quality of life on the continent is not yet anywhere near minimum globally acceptable standards.

The reason is not farfetched once we take a look at where the funds are being invested.

The funds are largely invested in equities and bonds, and in the case of Nigeria, so much of it is held in Government bonds.

It is tempting therefore to argue that although the pension funds contain contributions of the working class they do not as yet penetrate enough into giving value to the lives of the contributors.

Across all of Africa, there is a visible infrastructure deficit. No country to country rail service across most parts, the highways that connect most of the countries such as in the ECOWAS region are in very poor shape and these are roads that can easily be built, and tolled to earn income to secure the return of pension funds invested in building them.

Air travel is no better. Airports are not of the quality of design and construction or efficiency that are obvious in Europe.

These are places where pension funds can be impactful.

An online publication of “Institutional Investors” estimated that Sub-Saharan Africa’s ten largest pension fund markets had approximately $310 billion in assets recently.

But while these funds are not serving the “REAL SECTOR” of roads, bridges, hospitals, rails, airports, fee paying universities, there is a palpably visible poverty in most of these countries, some of who gathered to seek funding support in South Africa recently at the instance of the Chinese Government who offered funding support (loans) of $60 billion for all of Africa, when 10 (ten) pension funds had $310 Billion to invest.

Many of these countries are scurrying after multilateral agencies looking either for aid or loans, while sitting literally on a pot of money.

If Africa is poor today it is not because of a lack of resources; rather it is likely a poverty of ideas or the abundance of risk elevating attitudes, some of which I have alluded to, such as judicial and political, and these must change, as I will contend in my conclusions.

It must be mentioned of course that the attitudes that once mired pension funds management in scandals and lack of transparency, had led to very stringent legislative interventions that limited the scope of activities that pension funds could participate in.

For example, until recently, the Nigerian Pension Fund Law limited the contributor from using part of his pension to secure a mortgage.

How, one may ask is a person supposed to finance or part finance ownership of a home if he cannot use his own savings.

Happily the Amendment Act of 2014, has rectified this by the provision of Section 89 (2) of the Act which provision provides that:

“Notwithstanding the provision of sub-section (1) (c) of this section, a Pension Fund Administrator may, subject to guidelines issued by the Commission, apply a percentage of the pension assets in the retirement savings account towards payment of equity contribution for payment of residential mortgage by a holder of Retirement Savings Account”.

In contrast to the mismanagement that used to be the story of our own pension funds, the most prolific of the pension funds in Africa, which is the South African Public Investment Corporation (PIC) has over $150 Billion assets under management.

In Nigeria alone, they have $289 million in Dangote Cement , $98million approved but yet to be drawn for Notore Fertilizer, $230million in MTN Nigeria, $270million in Erin Energy (formerly CAMAC) and $150million in Mainstream Energy Solutions (in the power sector of Nigeria).

By contrast, the question to ask is what is the ‘home based’ pension fund doing? If as I have shown, the “visiting” pension fund from South Africa has a total of $897million in our economy.

The answer is obvious, that is why we are here, that is why my host in their invitation spoke of “…suitable investible vehicles with low risk profiles and sufficient comfort…” as the reason that “…continues to hamper the drive to make visible economic impact” in the letter to me.

Ladies and gentlemen, I have news for you. Those investible vehicles exist.

They are in roads that can be tolled, like housing, the 4th Mainland Bridge, the Coastal Road linking several coastal states from Lagos to Bayelsa ; the new seaport in Lekki and Badagry, the refinery by Dangote, Ajaokuta Steel, a petrochemical plant in the Niger Delta; the broken textile mills in the North and South of Nigeria that require new equipments and disciplined fiscal, technical and organizational management; prison in each of the 6 (six) geopolitical zones of Nigeria that can help strengthen our justice system and decongest the colonial prisons we have kept as relics of our own sense of justice; they are in hostels for students in Nigerian universities, embedded power plants in the universities, most of which have teaching hospitals and provide an opportunity to power education and healthcare and the list is endless.

It is as long as we can imagine. The time for it is now. This is the biggest opportunity to act towards diversification rather than sloganize about it.

This is the time to show that our Nation and our National economy is bigger than the challenges posed by the dwindling oil prices. This is the time to diversify and change the face of our economy once and for all.

But the risks that stand in the way are caused by us and they must be changed by us.

As I have pointed out, the list of assets to invest in is almost limitless.

Let me share with you some of the preliminary data coming out of the preparatory work we have commissioned on Housing Economies and impact.

One block of 12 (Twelve) flats will require about 93 workers multiplied by 40 Blocks amounting to 3,720.

Each block will require an estimated number of the following materials:

225 mm block 13,395

150 mm block 17, 430

100 mm block 450

Binding Wire 33 Rolls

Nails                   50 Bags

 

Lekki-Epe Toll Crisis: Artiste Were Mobilised To Incense People Against Me – Fashola

Nigeria’s Minister for Power, Works and Housing Mr. Babatunde Fashola has said that several artiste were mobilised by members of opposition to incense people against him in other to stop tolling on the Lekki-Epe expressway in 2012, while he was governor of Lagos State.

The minister who revealed this during the Nigerian Pension Industry Strategy Implementation Roadmap Retreat, stated the lesson of what he experienced is that Nigeria must not play politics with its economic survival.

“Investors want continuity of policies, even if Government changes.

Speaking for the first time on the Lekki-Epe Toll plaza crisis, Fashola said “potholes had taken over its surface, the population it was serving was growing daily and neither Lagos State Government had the funds to rebuild it and the Federal Government at the time was not interested even though oil income was increasing. Accidents were claiming lives regularly and nothing seemed to offer a solution until the Lagos State Government in 2005 signed a concession with a private group of financiers.”

Fashola further said that the financiers after doing their traffic studies, satisfied themselves that the business was “bankable” and they asked the Lagos State Government to pass a law; in effect to tie the hands of the next government that the concession will not be cancelled.

“In other economies, a contract, which Lagos State Government gave them, would have been enough; however, as I said, investors never forget, so they asked for a law, which the State House of Assembly passed. But when we thought that will suffice, they then asked for a “Federal Support Agreement”, which was akin to a sovereign guarantee. Of course Lagos and the Federal Government at the time had different political colours and a Federal Support Agreement was delayed by politics for 3 years. During that time, prices changed, exchange rates changed, many economic indices changed leading to cost impact, but eventually one was signed, during the tenure of President YarAdua. This meant that with the Federal Support Agreement, Nigeria’s Sovereign credit rating had entered the equation.” Mr. Fashola said.

He continued. “Regrettably, when the road was finally built, and tolls were to be charged to repay the financiers, all sorts of informed and misinformed players took centre stage. There was no resistance during the painful period of construction when children had to wake up at 4a.m to get to school at 8a.m. But as soon as the road was motorable and ready for use and Tolling , some sympathizers of the Federal Government of the day, on a political front mobilized resistance to the payment of tolls. They promised that if they were elected, they will cancel the toll. That is not good news to investors.”

“I got all sort of letters from around the world. Investors sent representatives from around the world to meet with us, asking what was happening. All lies were told against our officials after the road was built. But we were undeterred. We bore the lies. We managed the orchestrated protests. Some artistes were mobilized to pour red paint on their faces and posted these on the social media as evidence to incense people falsely that we had used violence to stop their protests. One newspaper falsely and recklessly carried a headline that our government had killed a person protesting illegal tolls. That was the first and only time I used the coercive power of the State.”

“We deployed Policemen to the toll plazas. They were instructed to allow protests which was legitimate, but they must also protect those who were not interested in protesting and wanted to pay tolls, because those who were opposed to paying had no right to obstruct those who wanted to pay. We begged, pleaded and held meetings for understanding. We explained that those of us who enunciated the policy were going to be affected by it as well. I drove through the toll and paid, to show this.”

“In all of this, my biggest concern was not the road , it was Nigeria’s credit rating and the need to ensure that the project did not fail. What was at risk was now bigger than the road and the Lagos State Government. It was a national reputation in the international business climate. I am happy to say that we preserved our country’s business integrity against all odds and I will do it again. For me, the lesson of this story is that we must not play politics with our economic survival. Investors want continuity of policies, even if Government changes. Our politics must therefore mature to the level where we must refrain from campaigns that threaten to cancel contracts. We will be poorer for it. Even when we perceive that the government of the day has poorly negotiated a contract, threats of cancellation do not help. What we may at the worst seek to do is to re-negotiate after elections are over where it is possible to do so.”

“If we compare the quality of service on the Lekki-Epe Expressway where toll is paid to the Lagos-Ibadan Expressway where toll has been removed, the choice is ours to make. Is it cheaper to drive on a road free of toll, and spend 5 hours for a 1 (one) hour journey? If you calculate the fuel burnt in 5 hours of standstill traffic and the stress, you will see that the toll free is not free.” Mr. Fashola told his audience.

Left to Mr. Fashola, he has no problem with the installation three toll plazas on the 60km road, however, his successor in office, Governor of Lagos State Mr. Akinwunmi Ambode has since cancelled the two additional toll plazas. The second one so far erected now serves as ‘Customer Service Points”.

Osun Defender recalls Governor Ambode while cancelling the remaining two toll plaza, said “the interest of the present administration is not to make the infrastructure a moneymaking venture, but rather, to expand the road to make commuting easier for the residents.”

Attack On Escravos Gas Pipeline: Fashola Recount Losses

Multiple losses running into N470 million has been incurred over attack by militants on Nigeria’s Gas Company pipeline connected to Chevron Nigeria Limited’s facility in Escravos, Delta state.

This was revealed by Nigeria’s minister for Power, Works and Housing, Mr. Babatunde Raji Fashola who recounted the losses to the nation’s power and gas sectors in a statement signed by his Special Adviser on Communications Mr. Hakeem Bello.

Mr. Fashola stated that the 600MW Olorunsogo NIPP and other Power Plants were affected in the attack as the sabotaged gas pipeline which contributes to the Escravos Lagos Pipeline System (ELPS) has led to a loss of 160mmsfcd of gas daily.

“At a cost of $2.50 per thousand scf, this loss means about $400,000 loss to the country on a daily basis (N78,800,000 daily) in gas volume. This is in addition to losses to be incurred daily from affected Power generation ($1,988,223 or N391,680,000 daily). The total daily loss to the country is therefore estimated at N470,479,931. Repairs of the damaged pipeline is estimated as costing ($609,137 or N120,000.000).”

“The real sector of the economy has also been counting its losses as some cement companies around Olorunsogo like Ewekoro and Ibese are also affected.”

“The latest incident has occurred just as the Federal Government through the Ministry of Power, Works and Housing and the Ministry of Petroleum Resources along with allied agencies has been making concerted efforts to improve gas supplies to the Power Plants. Such efforts led to previously offline plants like Ihovbor and Sapele coming back online and the subsequent output  making up for the loss in power. The pipelines are being actively monitored for further attacks or other unforeseen impacts.” The statement reads.

Available records show that six incidences of vandalism from December 2014 to February 2015 which affected the Trans Forcados Pipeline (at Oben, Sapele, Oredo ) and Escravos Lagos Pipeline System (CNL) led to a loss of 1,100 MMScfd. According to industry experts, a loss of 200 MMscd is equivalent to a Power reduction of 700MW.

While the industry is currently generating about 4120Mwh/h on average (as at 17/01/2016), it is without doubt that performance would have been better without the additional setback caused by the weekend’s incident.

Osun Defender recalls that during the monthly meeting of the Minister of Power, Works and Housing, Mr Babatunde Fashola SAN with operators in the Power Sector last week the  Nigeria Gas Company (NGC), the Nigerian National Petroleum Corporation (NNPC) and the GACN led by the Minister of State of Petroleum, Dr Ibe Kachikwu shared information on significant gas projects that will improve gas supply which are scheduled for completion in Q2 of 2016 and also highlighted some of the challenges especially related  to security affecting delivery of gas to the power sector.

In response to this, NNPC is forming a committee NNPC, Police, JTF (which includes Army, Airfoce and Navy) and also community vigilante groups, who have been tasked with the responsibility of securing these pipelines.