Reps Quiz NERC Over N11.8bn Spent On Furniture, Fittings, etc

Members of the House of Representatives on Monday quizzed the Nigerian Electricity Regulatory Commission (NERC) over the utilization of N11.8 billion spent on furniture, and fittings to complete ongoing office partitioning, training as well as a piece of data gathering technology.

The lawmakers expressed their concerns during the review of the 2023-2025 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) of various MDAs, also queried the sum of N2 billion proposed for an unspecified number of computer equipment in the 2023 budget proposal.

Some of the contentious subheads include: N1.3 billion for furniture to complete ongoing office partitioning, N3.5 billion for computer equipment and training and N5 billion for data gathering technology, among others.

Speaking during the engagement, Hon. Stanley Olajide who queried the duplication of projects implemented in 2022 Appropriation Act, observed that the N3.5 billion proposed for computer equipment and training in the 2023 budget proposal.

He said: “Looking at your projections for 2023, you have about N2 billion to spend on computer equipment. In 2022, what do you have for computer equipment?

“Also, in 2021 what do you have because we are going to be lending money to fund this budget or if you are not going to spend this money, it could be a revenue for the government. What part of this can you suspend: N2 billion for computer equipment and about one point something billion for training, what is the value money in spending this N3 billion in 2023? If you did something like that in 2022, why 2023 again?”

On his part, Hon. Sada Soli who queried the sum of N650 million proposed for 5 retiring staff in 2023 budget proposal, said: “Of course, the actuarial evaluation does the analysis on staff of the commission and the time they are going to leave. So, we fund the account to ensure that there is enough fund at the time staff are leaving.

“Now, the N150 million is not going to the fund but it is an additional retirement expenses that is being incurred that is not in what is being paid in the fund.”

While responding, NERC Chairman, Sanusi Garba who argued that spending N5 billion on IT was even grossly inadequate, noted that the computers were necessary for data aggregation from the feeders.

“Hon. Member, in utility regulation, information is key. We do not want to be relying on information that is coming from our licensee. So, we are investigating heavily in technology so that we have credible information about quality of service. Without technology, you wouldn’t know that our feeders in so, so places are out, let’s say for 48 hours, people are in darkness. Over the next years, we will be investing heavily in technology for data aggregation.

“In 2021, the budget for computers, not just hardware but software was N1.5 billion and we are spending N2.5 billion in 2023 and N1 billion in 2025 and we will do with this.

“For example, 33kv feeders, 11kb feeders all over the country, we would want to be in a position to see what is happening in all the feeders directly from the commission, not relying on the DISCOS telling you we supplied this and that in so, so location. So, N5 billion in technology today is really nothing. If you say, we don’t spend the money, it becomes a surplus. The way it works is that we don’t Budget it, then we don’t take it from the market. So, we don’t spend it and then we give it to CRF.

“Going deep into the technology side may not be appropriate, given the limited time. We are investing heavily in servers for data aggregation from all the feeders in the country. And then, the software itself, we are talking to funds like Oracle and so on for the enterprise resources we are putting on in the commission itself. We are putting ERP. We are going to have a meter management system where we see what is happening all over the country.

“Hon. Member, spending N5 billion on IT is absolutely nothing. Let me give you an example, a case of a DISCO recently spending over N2 billion on simply customer management system. Now, we do not manage feeders but what we are interested is harvesting data from what is happening out there. N5 billion is nothing. That’s why I offered to bring the feasibility studies for you.”

While speaking on the revenue projections from 2023 to 2025, he disclosed that the sum of “N22.4 billion with operating surplus of N2.1 billion. In 2024, revenues will go up slightly to N23.5 billion and operating surplus will go down to N1.1 billion and the reason is simply we are motivated as much as we can to reduce the tariff burden of consumers because of affordability issues.

“In 2025, revenues go up N24.7 and the operating surplus goes up to N1.4 billion. I repeat the surpluses are going down because we want reduce the tariff burden of consumers. Right now, the federal government is subsidizing the tariff to some extent. In the last few years, subsidies were in the region of N5 billion. So, we don’t want to contribute additional burdens and that’s why the surpluses are declining are we go forward,” he said.

In his remarks, Deputy Chairman, House Committee on Finance, Hon. Saidu Abdullahi who queried the Commission for failing to make necessary remittances to the consolidated revenue fund (CRF), requested for details of various transactions, just as he harped on the need for prudent use of public fund.

“Going forward we expect you to remit your CRF. Hasten up the process of reconciliation. We can’t afford to have money hanging somewhere when we have plenty for it. NERC, I think we have to commission a reconciliation that will involve the Fiscal Responsibility Commission (FRC), that will make it comprehensive.

“We can’t afford to isolate the commission from this exercise. You have between now and Monday next week to do the reconciliation.

“The essence is to put to you that not only that we are interested in how much you remit to the CRF, but we are also interested in how prudent these resources are expended.

“If we have the details, it will put us on the good pedestal to appreciate what you intend to do. I think going forward, it will be good to give the details of whatever it is especially if it coming on a huge amount. The Committee will be interested in know what you are doing with what,” he said.