Sunday, April 29, 2018

Some people are blocking payment of N1.8trillion owed NDDC — Ekere, MD

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Mr. Nsima Ekere is the Managing Director of the Niger Delta Development Commission, NDDC. Before he was appointed to run the Commission, Ekere was Deputy Governor of Akwa Ibom State.
In this interview, Ekere talks about the challenges facing the Commission and what has changed since he assumed office.
How has it been since you took over at the Niger Delta Development Commission?
It has been very challenging, very engaging, but also interesting. NDDC was well-intentioned by government to help the Niger Delta deal with some of the effects of exploration. So, it is a good platform that could adequately address the challenges of the Niger Delta. And it has actually been doing that. Could it have done more? Probably. The greatest challenge I would say we have been facing is the overtrading that the NDDC has been involved in. Before we came in, the balance sheet of the commission was over-bloated. It was so huge.
We had contingent liabilities. In fact, the auditor’s report for last year, we used to think it was N1.3trn but it was N1.7trn contingent liabilities. Of course, last year, we had to terminate some non-performing projects in two tranches. The first tranch was about 624 projects worth about N200billion. So, we have reduced the balance sheet now by about N300billion which is one of the four tranches that we articulated as our reform agenda when we came on board.
We called then the four Rs. To restructure the balance sheet of NDDC because they were so huge and part of that reduces the number of new commitments, new liabilities were created. That is why we dedicated 70percent of our budget to ongoing projects so that we can try to complete them, so only 30percent is for overheads and new projects. That is deliberate because there is no point creating new liabilities for the commission when there is no money.
The second R is about the reform agenda that we came with which is to restructure the governance system of NDDC. We want NDDC to be known as an organization that respects laws, respects government policies and follows due process in whatever we do. Before now, virtually anything could happen in NDDC. That is why we said we must improve the governance system and bring in technology to run things there.
The third plank of the reform agenda was to restore the commission back to its core mandate and get NDDC to concentrate on ticket projects that will lead to regional integration, build a regional economy and stop competing with local governments.
That is why, for the first time, you will see that we have started doing projects in collaboration with state governments.
The fourth is to generally rededicate ourselves to what is good at all time. Are we where we want to be? I will say no. It’s still work in progress. A lot of work still has to be done.
What are the greatest challenges at NDDC?
The greatest challenge to us, as a management, is the attitude of the people. There is this sense of entitlement. They have been spoilt for so long, so they are used to getting things done in a particular way and getting certain kinds of gratifications.
Right now, they may not get what they are used to getting. In fact, about two weeks ago, I got a threat from some group. First of all, they went online in the media and posted something, “This is the worst management of NDDC ever” and they were calling on the President to dissolve the Board and set up a new one. A friend of mine decided to call them and they said to him, “He is supposed to give us something but we have got nothing”.
So, I said they should talk to them to find out what they need and at the end of the day we found out they want money. How do you take government money and handover to someone just because they have gone to the internet and said things about you? The day you pay him, the next day another group will go and do the same thing. So, the attitude is one of the greatest problems that we have faced and we are hoping we will keep working on their attitude.
Does NDDC have interaction with the people before citing a project in their domain or the Commission just decides the type of projects and where to cite them?
We decided to adopt the bottom-up approach in project conceptualization. We gather all kinds of representations from the communities. They write letters demanding projects, but we made up our mind that we must work in collaboration with state governments. Before now, we had a situation where there are lots of conflicts with the state governments.
You’re doing a road here and the state is also doing a road in the same place, you’re doing a water project, you will discover the Chairman of the local government is also trying to do a borehole in the same place. So, what we did was, we set up States Project Committees for the nine states of the region. They also serve as the budget committees, so the state representatives on the Board of NDDC chairs that committee. We tell them, go to your state, engage with the state government and agree from all of the requests coming in from different communities, on which projects NDDC should take on board.
To what extent has funding being the challenge of the Commission?
It is a huge challenge. I have a friend who was MD of NDDC sometimes ago when he took over, he met a balance of N130bn. That was what he used to start work. When we came in, we met about N2bn. Meanwhile, the salary bill of NDDC in a month is over N800m. So, by the time we paid the first salary, things dropped. So, we can’t really do anything but we have been working with
the oil companies to get their contribution to the NDDC fund and also the federal government contribution too has been coming in.

There is a huge deficit in terms of what we get and what we are supposed to get from the federal government cumulatively. Over the years, we have a deficit of almost N1.8trn debt that is being owed by the FG to NDDC from inception to date.
How do you go about recovering such fund?
We have engaged the federal government. We wrote to the President. Fortunately, we got his sympathy. He directed the Ministry of Finance and the Ministry of Budget and Planning to sit down with the NDDC, do a reconciliation, agree on the exact amount that the shortfall has become cumulatively over the years and then agree on an acceptable payment plan so that the money can be paid to us. Unfortunately, I will say we are not getting the kind of support we expected from the Ministry of Finance because till date, we are on it but we haven’t agreed on anything yet. We are hoping and putting pressure on them to try.
Most of the funding we have used have been from the oil companies. Most of them are paying. Of course, there are still some that are outstanding. But the Senate and the House of Representatives have been outstanding in helping us recover the money.
People are complaining that NDDC is doing more in infrastructural development and not doing much in the area of poverty reduction within the region. How do you react to that?
I share the concern you raised. We believe it is good to build infrastructure, but it is necessary to build human capital as well. NDDC over the years has done a lot of capacity training; specialized training, skills, and acquisition training in different areas. The last time we graduated some people that we trained on home finishing skills, I think that brought the total to almost 23,100 the number of people we trained in different skills, ranging from like home finishing skills that we did. We trained people in welding, catering, agricultural and all kinds of skills.
I believe that we must look for a sustainable development model that would keep our people permanently involved and engage for a sustainable period of time. And that is why we thought of the Enterprise Hub.
We are doing two things right now. We set up N5billion export-oriented agricultural scheme. The idea is to help farmers in the region in their agricultural value chain targeted specifically at export from shipping, fishing, and even cassava. We will help people depending on various states and areas that have comparative advantages at certain products. So, we identified those products and we are now working together with the Bank to help them, fund them and mentor them so that the products can come out will be exported. That is one of the programmes that we are working on.
Secondly, we are partnering with Small and Medium Scale Enterprise Development Agencies of Nigeria (SMEDAN) in setting up an enterprise hub. I am very passionate and enthusiastic that this particular hub will help the region.
Has it taken off?
We signed the MoU in November 2017 with SMEDAN and the private sector people and then, in February 2018, we signed the agreement with them for the hub to take off. We are also doing something, especially for the disabled people. Over 200 persons with disabilities will be trained in the next few weeks in different skills.
Buhari administration came in with fighting corruption war, revamping the economy and the change mantra. What have you been able to change in the NDDC?
I just told you about the reform agenda that we instituted when we came in.
There is a perception by some people that the NDDC is a cash cow. Since you took over, what have you brought in to change that perception?
It is not so. When we came in, we instituted those reforms I talked about; the 4Rs to change the way the place is run so that the place can be run in a more transparent and efficient manner and it works. Let me give you a scenario of the NDCC; on monthly basis from the federation account we get about over N5billion monthly and by the time we pay salaries and send money to state offices for overheads generally; salaries alone is about N800million and by the time you pay the state offices and impress to the various directorates and so on and so forth, you have about N3billion plus and you have conservatively about N1trillion as debt.
So, how can it be a cash cow when every month you are thinking of how to cut some fingers and add and pay contractors. Seriously that is what it is. So, it is a wrong perception. Being the Managing Director of NDDC is a very tough and difficult job; you can’t sleep because of this kind of perceptions people have. People will call me sometimes about 2am even up till 3am, my phones are still ringing.
Some people will start calling you as early as 4am because everybody is expecting money. The boys in the region and even the elders are all expecting money, the traditional rulers are expecting money. How do you get this money and give to everybody? How do you satisfy them? It is a wrong perception. And I will charge the media to help us change this perception. NDDC is definitely not a cash cow. It doesn’t even have the capacity to be a cash cow in the current scenario.
We are not generating any income. We cannot be a cash cow. And then because we are now committed to doing things properly, following the law, policies and due process in all that we do; you will see that to collect N1 from NDDC, you will sweat; you will go through about 50 stages to be able to take money out of NDDC. All of this process is just to make the place to be functional.
So, it is not easy. It cannot be a cash cow and definitely, it cannot be. Even if we want it to be a cash cow, it cannot be because we don’t even have enough cash because every month you have projects that you want to complete. We prioritized some projects that we think we should complete so that they can help the various beneficiary communities and so those contractors are waiting for payment; they are waiting for money to be able to push the projects. So, on a monthly basis, that is the situation you find yourself looking for money to pay contractors just for the place to keep moving. So, I beg, NDDC is not a cash cow.
Is it true that NDDC doesn’t pay contractors mobilization bill again?
Yes. I inherited that policy and I decided to keep it. Not to pay mobilization to any contractor. We pay on the milestone. As contractor work and raise Interim Payment Certificate (IPC), that is when we pay them. So that way, what used to happen before when contractors will collect money and go away has stopped. You know one of the problems of NDDC then is that they say contractors collect money and run away; that has stopped in NDDC. We stopped it because we don’t give anybody mobilization and that way you know that you are dealing with credible contractors who have the capacity. Before they used to pay mobilization sometime 20 or 30 percent and a contractor will just collect that mobilization; look at the entire project and even if he finishes, what percentage profit will he make; maybe 30 percent. So if he has collected the mobilization fee of 20 percent, what incentive are you giving him to continue the project? He will just abandon it and take the money and go. And make his money upfront.
So, this policy of actually stopping advanced payment has helped to sanitize our projects; so you don’t have contractors collecting government money and abandoning sites. I appreciate the fact that some genuine contractors are being put in the tight corner because of this policy but this has helped us to ensure that we are dealing with credible contractors.




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