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Controversies trail FG’s concession programme

By Peter Egwuatu0
Controversies are trailing the concession programme being embarked by the federal government to improve infrastructure facilities in the country.

Emeka Nwasike

Mr. Emeka Nwasike, Managing Director of ATSL

There seems to be the fact that some government officials are not comfortable with the exercise which started with the administration of former President Olusegun Obasanjo.

Immediately, the tenure of Obasanjo ended, they started taking actions obviously geared towards frustrating the implementation of the policy. A case in point is the Murtala Mohammed Airport (MMA2) where elements within the Federal Airports Authority of Nigeria (FAAN) are obviously not happy with Bi-Courtney Aviations.

Another institution where controversy is brewing over its concessioning is the Centre for Management Development (CMD), where Allied Thrust & Systems (Nig.) Ltd. (ATSL) won the bid to maintain the property.

The current Director-General of CMD, Dr. Kabir Usman seems to have been caught by the bug bent on frustrating the policy by trying to renegotiate an agreement already in place before his appointment, which many within the top hierarchy of the Centre believed did not follow due process since the position was not advertised when it was vacant.

It will be recalled that the Federal Government under the Obasanjo administration in 2005 inaugurated the Infrastructural Concession Regulatory Commission Act (ICRC) in a bid to give legal teeth to the government strategic moves towards confronting the problem of infrastructural decay in the country under Public Private Partnership (PPP)

World Bank also endorsed the adoption of concessioning programme by developing countries to  improve their infrastructural facilities.

With the support of the World Bank and other financial institutions, many African governments are adopting the concession option for the development of their basic infrastructure facilities.

The “infrastructure” envisaged under the ICRC Act 2005 covers virtually every sector of the economy: power plants, highways, seaports, airports, canals, dams, water supply, telecoms, railways, land reclamation, inter sate transport systems, industrial estates or township development, housing, tourism development, waste management, ICT and database infrastructure, education, health, drainage, dredging, trade fair complexes among others.

Given the state of most public assets, there was no doubt that concessioning will hold great promise for the economy.

It was against this background that the Federal Government through the National Planning Commission placed advertisement for expression of interest for the management of the Centre for Management Development, Lagos (CMD) facility on a Build, Operate and Transfer (BOT) basis.

It was gathered that 10 companies expressed interest in the bidding process, out of which six were short-listed and eventually; Allied Thrust & Systems (Nig.) Ltd. (ATSL) emerged as the preferred bidder.

Consequently, the National Planning Commission (the lessor) on March 1, 2007, entered into an 18-year lease agreement with Allied Thrust & Systems (Nig.) Ltd. (the lessee).

Under the terms of the agreement, 5.02 hectares of land of CMD was demised to the lessee, who was also expected to renovate the existing 30-room facility (serving as the Guest House), construct a 102-room guest house with 4-star facility, build and operate a 1000 seat conference facility and pay a graduated annual rent of N270 million to the lessor in three tranches over the lease period.

Subsequent to the agreement ATSL effectively took over the management of the property in May 2007. According to information gathered cordial relationship between the management of CMD and ATSL began to grow cold when in September 23, 2008, Mr. Emeka Nwasike, managing director of ATSL wrote the management of CMD, then under the director-generalship of Dr. Joseph Maiyaki, seeking approval to commence work on the conference hall.

In a reply to the letter, Mr. B.D. Chinoko, a senior official of CMD wrote, “I am directed to refer to the on-going construction work in the Guest Facility area and to inform you of the decision of Management to request you to discontinue the work since it does not have its approval.”

It added that, “Please be reminded that by the Terms of Agreement, the only construction work approved are the Hotel and the Conference Centre.”


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