The House of Representatives this month, began a probe into the alleged contract scam between the Ministry of Finance and Single Windows System Limited (SWST). Adesuwa Tsan writes on the anomalies uncovered and why the probe may be protective of some personalities involved in the mess.
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The biggest obstacle to the growth and development of Nigeria has so far been identified as corruption.
This vice kept coming up at the recent investigation of the federal ministry of Finance and Single Windows Systems and Technology Limited (SWST) contract agreement by the House of Representatives.
As is now typical with investigations by the legislature into the activities of the executive, damning revelations were made about how due process was out-rightly disregarded in the contract award.
The investigation started as a motion sponsored by Hon Yakubu Dogara who prayed the House to take an in-depth look at the agreement and determine why operators in the sector should be made to pay additional charges for services which a department in the Nigerian Customs Service (NCS) has been trained to undertake.
The federal government had expended over N300bn in the last six years from Comprehensive Import Supervision Scheme Account with the Central Bank of Nigeria in order to automate the customs documentation and clearing process.
According to Dogara, “In the new concession, 1 percent Freight on Board on imports/exports will be charged to Nigerian traders for an initial fixed term of 15 years extendible to 20 years.
This project, with a 10 percent annual trade increase would bring disproportionate revenue to Nigeria in the region of $30bn.”
The effect of the deal could mean that businessmen who operate in Nigeria may have become forced to divert their imports to neighbouring Benin Republic and smuggle same to Nigeria.
The contract was supposed to commence in December, 2012 when the contract of the current service providers will expire but the government had already given SWST permission to access all facilities being used by the current service providers at all customs formations across the country in preparation for their take-over.
The terms of the agreement is that no funds will be released by the federal government to finance the project which is why the company claims the contract is free but they would charge 1 percent freight on board import/export, a charge which will culminate to over $30 billion USD in 20 years period, the duration of the contract.
A single window system, which is the service which the SWST was to render to the Customs service, is a facility that allows parties involved in trade and transport to lodge standardised information and documents with a single entry point to fulfil all import, export and transit-related regulatory requirement. The main aim is to simplify information flow between the trade and government parties.
Following the motion adopted by the House on the matter, President Goodluck Jonathan had ordered the Finance Minister, Dr. Okonjo- Iweala, to immediately suspend the agreement, look into the processes that led to the award and address the important questions raised by the House.
The letter titled Re: Single window concession, stated that “by the leave of Mr. President, I have suspended the single window project in deference to the concern of the National Assembly.
“Mr. President had asked me to look into the processes that led to the award with the view to review the important issues raised by your committee. I will refer to you in due course with the outcome of this inquiry.”
Chairman of the committee and deputy leader, Hon. Leo Ogor, was however not deterred by the letter which he described as moves by officials of ministry to stall the probe. Hence, he summoned Okonjo-Iweala, to appear before the committee or face arrest having failed to appear before the House after the first invitation.
He said: “The National Assembly is a separate arm of government with its clear responsibility and resolution of the House.
The Minister of Finance has refused to appear before this committee as far as we are concerned.
An investigation by the ministry of finance will in no way deter this House from carrying out its own constitutional responsibility.
I am, therefore, resting on the Nigerian constitution sub-section 88 and 89, to summon the honourable minister that she must appear before this committee to clear decision on the audacity and process that led to this particular award of this contract.’’
He also said “We lay emphasis on due process, whatever investigation they carry out in the ministry is their own internal business.
It is important that she must appear before this committee tomorrow (Tuesday) 12 noon unfailingly.’’ In the course of the public hearing, Ogor said the report will be sent to this ministry so that they can appreciate the cost implication.
Ogor reaffirmed the willingness of the House to probe the matter, “I am, therefore, directing by the clear provisions of sections 88 and 89 of the 1999 constitution summoning the minister that she must appear before this committee to give clear position in respect of the modalities and process that led to this particular award.”
While the current minister is being put under fire to provide the lawmakers with details of the agreement, nothing is being said about the person that authorised the fraudulent transaction.
Current minister of Trade and Investment, Dr Olusegun Aganga was Finance Minister till late May when the cabinet was dissolved.
It was during this period that the concept was introduced, the selection made and the contract awarded.
Thus, observers have expressed shock that the panel did not deem it fit to invite Aganga to be part of the proceedings at the investigative hearing.
This has made some Nigerians to suggest that Aganga is being shielded from impending indictment. Some Nigerians are therefore wondering why Aganga was not on the hot seat?
Questions upon questions but no answer. Nigerians are also asking why the ministry had decided to sideline the NCS in the process and why the contract was approved when the customs already had capable staff that had been intensively trained to carry out the same services as that which the SWST was offering.
At the hearing, the Comptroller of the Customs Service in charge of ASYCUDA, Mr. Azarema Abdulkadir, informed the panel that the service was not involved in the concession agreement even though they were the recipients of the deal.
He said that the service only received a letter dated May 24, 2010 asking it to cooperate with the company.
He said, “The service was informed by the ministry of finance that a concession agreement had been entered into between the Federal Government and Single Window Systems
Technology Ltd.’’ He noted that the service has already trained more than 8,000 officers to take over the implementation of the project at the expiration of the agreement in 2012.
It is pertinent to note that the federal government has in the last six years expended over N300bn from a Comprehensive Import Supervision Scheme Account domiciled with the Central Bank of Nigeria to sponsor the training of the IT staff of the NCS and to finance the automation of the customs documentation and clearing process.
SWST was also put under scrutiny as the members of the panel queried why the Memoranda of Agreement did not have identifiable signatories.
Earlier while bringing the issue to the House, Dogara had said the only identification the company had was an office which operates from a residential building in Maitama.
In reaction to the discovery, chairman of the ad-hoc investigative committee said, ‘‘we are surprised that the finance ministry could award a contract of this magnitude to a company that does not have a chairman and signatures to the agreement were signed for the managing director and the regional by unknown person’’.
The lawmakers noted that in the documents submitted to the Corporate Affairs Commission, one of its directors is of a dual nationality of Ethiopia and Britain, an observation which was undisputed by the company.
The Corporate Affairs Commission (CAC) said SGS Geneva -a sub contractor in the concession contract under probe- had no authority to do business in Nigeria since it was not duly registered in the country.
The contract was originally entered with the international firm but was being prosecuted by its Nigerian representatives, SGS Scanning Nigerian Limited, who is not listed as parties to the contract.
The CAC disclosed that if the company had not been granted an exemption from the president, and was not invited by the Federal government or any state government for a specific project or a donor agency, then it was supposed to have passed through the registration processes to do business in Nigeria.
The CAC also said it had begun investigation on the shareholding of the company and has even gone ahead to place a caveat on the company to prevent any transaction until the investigation is concluded.
The issues under probe are as numerous as the hands of an octopus. Having completed the investigative hearing, the lawmakers will now proceed to the next stage of writing their reports and it is hoped that this will not end up becoming ‘one of those probes’ whose end is never known.
The legislature has in the last eight years conducted a series of probes that exposed corruption but whose recommendations are never implemented or reports left to gather dust on the shelf though in recent times, they have started influencing the decision of the executive who now suspends contracts or acts on them based on their findings.
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