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Shonekan’s commission faults Lagos-Ibadan expressway concession

THE Infrastructure Concession Regulation Commission (ICRC), has blamed the Ministry of Works for not doing a thorough job before signing the concession agreement for the N89 billion reconstruction work on the Lagos_Ibadan expressway. The road project was concessioned to Messrs. Bi_Courtney Highway Services.

The Commission accused the Ministry of hastily signing the concession agreement without a detailed survey, cost and clear risk allocation structure of the contract. These factors according to the agency are responsible for the delay in the project taking off.

The contract was awarded over 20 ago under the former Minister of Works, Dr. Hassan Mohammed Lawal, but the firm is yet to make any impact on the project.

The 110 kilometre Lagos_Ibadan expressway was concessioned and handed over to the firm for major reconstruction, expansion and modernisation in April 2009, with a special consideration period of 25 years under the DBOT scheme.

ICRC’s displeasure with the concession is contained in the annual report and statement of account of the agency presented in Abuja by the Chairman of its Governing Board and former Head of Interim National Government, ING, Chief Ernest Shonekan.

According to Chief Shonekan, “the Lagos_Ibadan expressway is one of the legacy projects that have been under development before the inauguration of the Board of ICRC. The ICRC received a request from the Federal Ministry of Works, Housing and Urban Development in respect of the concession of Lagos_Ibadan expressway, which the Commission reviewed and suggested that a detail condition survey needed to be done to ascertain the cost of the project.

“The Ministry nonetheless went ahead to sign the concession agreement despite the absence of any cost and a clear allocation structure,” he lamented.

Chief Shonekan however, reassured that, “the Commission will work closely with the Ministry to ensure that the project is successfully implemented and managed.”

He stressed further that, “in fulfilment of its mandate, the ICRC has been promoting, facilitating, supporting and coordinating the initiation and development of a sound PPP process, while ensuring that principles of good governance are applied to all of the functions that form part of the PPP process.”

The Commission he said, “is also providing transaction support and capacity building support for MDAs for project development, structuring, negotiation and contract execution.

“In addition, the ICRC has developed guidelines for monitoring contract compliance during construction, operations/maintenance and contract termination principles including providing hands on support as appropriate to MDAs assigned to this task.”

In his remarks, the Minister of Finance, Mr. Olusegun Aganga said there is urgent need to increase capability to deliver infrastructure in the country.

He noted that, “where we as a government have had the capital to spend on projects, we have not always excelled at utilising it. The average capacity utilisation within Nigeria is about 60%.

“This means that we must find ways to deploy capital more efficiently and there is also scope to drive down the cost of capital projects through proper project management. There are reforms in this area that the government is undertaking to ensure value for money,’ he said.

He said therefore, we must strengthen the ICRC and ensure that it is accepted as the focal point for PPP in government able to deploy its powers to drive PPP programmes.


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