An accumulated debt of N174.3 billion is threatening strategic project execution and implementation by the Ministry of Aviation, the Senate Committee on Aviation heard.
At an oversight visit by members of the committee to the Ministry of Aviation to review 2013 budget performance, the lawmakers were told that about N174.3 billion is owed to contractors as well as commitments entered by the ministry for the execution and implementation of projects captured in the aviation master plan.
A copy of the presentation made to the committee obtained by us indicates that these debt commitments were made between 2011 and May 2014, mostly during the tenure of former minister Stella Oduah to execute different project phases and special projects.
A total contract sum of N217.5 billion was awarded within the said period. In phase I of the plan about N10.1 billion worth of contracts were awarded; N57.7 billion in phase II; and N63.1 billion in phase III.
Other contract commitments include the Bilateral Air Service Agreement (BASA) projects, N31.6billion; special projects, N16.7 billion; Security projects, N9.4bn; and the Enugu and Bayelsa International terminals, N28.7, which are contracts the supervising minister, Dr Samuel Ortom, said he believed were transparently awarded.
A breakdown of the ministry’s indebtedness shows that about N740 million debt is owed for projects executed in the phase I plan, N22 billion for phase II, N59 billion for phase III, N31.6 billion for BASA projects, N16.7 billion for special projects, N9.4bn for security projects, N16.7 billion for Enugu and Bayelsa International terminals and the N18.2 billion interest accrued from both the $100m DMO loan and $500m Chinese loan for four international airports and their cargo terminals in Abuja, Lagos, Port Harcourt and Kano.
“By the time we came in, contracts were already awarded for these projects,” the supervising minister told the lawmakers.
Giving an account of the project implementation, Mr. Ortom said out of the 17 projects earmarked for phase I, 14 have been completed while 188 projects are at various stages of completion for the phase II. Most of the 184 projects are just taking for the phase III.
On strategies for repayment of the debts, the minister said the ministry may review and forfeit some projects. He also said the ministry is considering sending a memo to the president to seek for special intervention fund to offset some of the debts.
“We have set up an inter-ministerial committee to review the projects in addition to an airport development levy in line with international best practice,” he added. Chairman of the committee, Senator Hope Uzodimma, picked holes in the depletion of the BASA account which now stands at N10 billion.
The account is supervised by both the National Assembly and the presidency.
He said there was no time when the national Assembly gave approval for the ministry to spent huge amount of money from the account.
