The National Assembly is happy with incessant allegations of conflict of mandates between the Bureau of Public Enterprises (BPE) and the Ministry of Finance Incorporated (MOFI). Consequently, the lawmakers have called for the immediate amendment of the BPE establishment Act to expunge the clauses creating conflicts with that of MOFI.
The Senate made the call in a resolution signed by the Senate President, Godswill Akpabio, at the end of its plenary session for Ministries, Departments and Agencies (MDAs) to defend their 2024 Fiscal Appropriation.
The Bureau of Public Enterprises (BPE) was established through the instrumentation of provisions of the Public Enterprises (Privatization & Commercialization) Act of 1999 charged with the overall responsibility of driving the Federal Government’s programme of privatisation of public enterprises, carrying out sector reforms and liberalisation of key economic sectors, especially the infrastructure sector.
MOFI was incorporated under the provisions of Sections 2 and 3 of the Ministry of Finance Incorporated (MOFI) Act of 1959 with a mandate as an asset holding company and the sole manager of all federal government investment interests, estates, easement and rights as well as a strategic institution to support the Federal Government’s effort to address several economic challenges and spur a renewal of the economy.
By virtue of its mandate, MOFI has, for decades, been in charge of the management of a significant portfolio of Federal Government investments in about 130 Government Owned Entities (GOEs) and Government Linked Companies (GLCs) currenly valued at ₦18 trillion.
However, in recent times the two agencies have been inundated with allegations of conflict in the exercise of their mandates seen by observers to be overlapping.
Consequently, the Senate in its resolution No.54 of December 30, 2023 called for, among other actions, the review of the BPE Act, to remove the areas of conflict with MOFI’s mandate as the authorised sole custodian of all Federal Government liquid and physical assets.
As part of the resolution, the Senate urged the management of MOFI to assert its authority by exercising the powers conferred on it by law by conducting a comprehensive examination of the activities of all government agencies under its purview, particularly those currently operating under the partial and full commercialization arrangement.
Under the privatisation and commercialization programme organised by the BPE, publicly owned enterprises and entities were privatised and reorganised into wholly or partly owned entities, to allow them operate as profit-making (commercial) ventures without subventions from the federal government.
Years after the programme, the privatised and commercialized entities appear not to have met their objectives, resulting in the demand by concerned Nigerians who keep faulting the process adopted by the BPE.
Specifically, in the power sector, the privatisation of the unbundled Power Holding Company of Nigeria (PHCN) in 2013 into 18 successor companies, consisting six generation companies (GENCos), 11 distribution companies (DISCos), and one transmission company of Nigeria (TCN), was supposed to ensure the entities developed the capacity able to adequately generate and supply electricity to meet the nation’s need for stable power supply.
However, despite their privatisation, the GENCos and DISCos are not only struggling to deliver on their mandates, they are still largely dependent on government’s subsidies and support.
To allow them compete with their peers in the private sector towards delivering their mandates and be in a position to contribute meaningfully to the government’s revenue generation drive, the lawmakers want MOFI, as the custodian of these assets, to carry out a comprehensive review of their operations.
But the reconstituted Board of Directors of MOFI, which was inaugurated a fortnight ago in Abuja by the Minister of Finance and Coordinating Minister for the Economy, Wale Edun, is said to be facing a difficult time trying to convince BPE to allow it have access to some key documents on the operations of the privatised entities, particularly those relating to their financial statements.
“It is clear the BPE is fast becoming a stumbling block to the smooth operation of MOFI and the exercise of its mandate. We have directed MOFI to work closely with the Nigerian Institution of Estate Surveyors and Valuers (NIESV) to, first, conduct the valuation of all government assets. We believe the value of all government assets is far more than the current N18 trillion estimate. That exercise will confirm that,” a lawmaker told our reporter on Monday.
The lawmaker, who requested that his identity should not be revealed for personal reasons, confirmed the National Assembly, through its various standing committees, has already announced plans to review the laws governing the operations of all revenue generating agencies, to identify specific sections or clauses that require amendment to plug waste and boost government’s revenue generation capacity.
The Assembly said it has already commenced the process of amending the Fiscal Responsibility Act (FRA) 2007 to enhance fiscal responsibility and impose sanctions on erring workers against the violation the provisions of Sections 21(1) and 22(1)(2).
These Sections border on the preparation of revenue estimates and expenditure by corporation as well as operational surplus and general reserve funds by government entities.
