Questions Over Lagos-Ibadan Road Contract

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On 19 November, the Federal Government terminated the concession contract for the Lagos-Ibadan Expressway granted to Bi-Courtney Consortium, in a move hailed by many Nigerians.

The government subsequently re-awarded the construction of the badly dilapidated road to Julius Berger plc and R.C.C. Nigeria, in what it described as an emergency intervention.

The government said it took the action following the failure of Bi-Courtney to execute the project,  six months to the expiration of the estimated four-year duration of the construction.

The concession contract which was awarded to Bi-Courtney in May 2009, was to have covered a 25-year period during which the firm would toll the road and recoup its investment under a Build-Operate-and-Transfer, BOT, deal worth about N89.5bn.

But a combination of funding constraint, on the part of the concessionaire, government’s frustration of another project by the concessionaire, the MMA2, government’s red tape — all scuppered the project, as the carnage on the all-important but dilapidated road continued.

Bi-courtney, which failed to get the funds it badly needed from its bankers on time, also blamed the delay in the project’s execution on the delay in government approving the design for the construction of the 125-km road.

The design was approved just last year May (two years after the contract signing), the company claimed, a condition that had to be met before construction work could commence proper.

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While engaging the services of Julius Berger and R.C.C. to take over the reconstruction is a welcome intervention, questions remain on the manner of their engagement by the government.

In announcing their engagement, the Minister of Works, Mr. Mike Onolememen had said that: “While Julius Berger would handle section 1: from Lagos to Shagamu interchange, RCC Nigeria Limited will be responsible for section II from Shagamu to Ibadan.”

But the minister failed to say how the government arrived at the selection of the two firms, having not opened any bids for the contract, a prerequisite for qualifying to undertake government projects. Also puzzling was whether government considered  the track record of the contractors.  RCC once handled a N10 billion repairs of the same road in the tail of Obasanjo’s administration in 2007 and did a very woeful job. Julius Berger on its part handled the failed Lagos-Otta Road, now giving motorists nightmares.

There is also the big question of how the federal government intends to fund the project, having not been included in the current year’s budget or the 2013 Appropriation.

The minister’s explanation that the project is being executed under a special Presidential Emergency intervention fund is Greek to Nigerians.

In trying to right a wrong, the Federal Government cannot resort to illegality by not allowing the contract to go through the due process of bids and pre-qualification.

It also cannot resort to extra-budgetary spending in the name of ‘emergency intervention’. The government has to come clean on these puzzling issues, and do the proper thing, if its claims to transparency and Rule of Law are to be taken seriously.

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