WE CAN EXPLAIN EVERY ITEM - LAGOS STATE GOVT REACTS TO PUBLIC OUTCRY OVER BUDGETARY SPENDING

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Provides Explanation for Every Item Raised by the Public

By ‘Leke Yusuf

The Lagos State government through its Public Procurement Agency (LSPPA) has reacted to public outcry over some its budgetary spending.

In a statement released on Monday night, the Director-General of the Agency, Fatai Onafowote; he said that the LSPPA acknowledges the misunderstanding arising from lack of clarity on budgetary items posted on their website.

He said “the Agency is committed to ensuring transparency, accuracy, and accountability in all government transactions, as mandated by the Lagos State Public Procurement Law. We regret that specific details, particula rly concerni ng the descriptions of government dealings, may have inadvertently led to confusion, impacting both governmental entities and corporate partners providing services to the State. This arose largely from the lack of detailed descriptions in the project information, which has inadvertently led to confusion in the public space.

“We empathize with public concerns and extend our sincere apologies for any distress caused, it’s never our intent to cast doubt or cause misunderstandings that might tarnish the reputation of respected individuals and organizations involved in these transactions.

“To address these concerns thoroughly, the Agency has taken immediate steps. Line-by line explanations of the contracts in question are attached herewith, aiming to provide absolute clarity and dispel any lingering misconceptions.

“The Agency will continue to improve its internal processes and communication methods as our commitment as a government is to offer clearer and more accessible information

“To the public, it is pivotal to stress that the Agency’s autonomy exists to ensure fairness and transparency, not to cause confusion or discredit any involved parties. We therefore assure the public of our unwavering dedication to upholding the highest standards of integrity in all our operations. Looking ahead, we pledge our continued commitment to consistently and accurately report all government transactions in the State.

“Our unwavering commilment remains to elevate the standard of living and enhancing the quality of life for the people of Lagos. Rest assured, this commitmen will always take precedence.”

Onafowote then went ahead to explain every item:

1.On Lagos Metropolitan Area Transport Authority (LAMATA) with respect to Construction, Supply & Installation of Operation and Maintenance (0&M) Infrastructure of LRMT Blue Line Phase 1 from Marina to Mile 2 valued at N40,188,644,336.

Response by LSPPA:

The Blue Line Rail Project’s design and construction were entrusted to Messr CCECC Nigeria Limited. Subsequently, upon Rinalizing the Rixed infrastructure, a two-year partial operation contract was executed with the contractor for the following purposes:

bolster the technical and operational expertise of LAMATA’s teams, fostering their
meticulouslygather scientiRic Rinancial and revenue data essential for informed decision-making
equippertinent practitioners with the necessary information crucial for forthcoming concessioning empower the contractor to promptly address any defects identiRied during the operational phase of the project.

2. Construction of Lagos Rail Mass Transit (LRMT) blue line Mile 2 to Okokomaiko (section 2) valued at N218,071,301,485

Response by LSPPA:

Phase 1 faced signiRicant delays due to insufRicient funds. The current administration’s strategy successfully realized the Blue Line Rail Project. The Governor remains dedicated to completing section 2 during this term, employing the same approach used for phase 1. Section 2 has already been entrusted to Messr CCECC Nigeria Limited, seamlessly continuing the project with ongoing execution. In a commendable move, the Lagos State Government compensated verified property owners and tenants, following a globally accepted standard—a practice that will continue as needed.

3. Consultancy Service for the update of the strategic Transport and Mobility Master Plan for Lagos Mega City Area (N5,380,695,140)

Response by LSPPA:

The Consultancy Service for updating the Strategic Transport and Mobility Master Plan for the Lagos Mega City Area was awarded to Messrs. ROM Transportation Engineering Ltd in collaboration with Advanced Engineering Consultants (AEC) after a rigorous 15-month competitive procurement process led by LAMATA, AFD, and PPA. The awarded contract, valued at ₦1,167,451,900.54 plus €4,213,243.24, spans 24 months.

While ROM Transportation Engineering Ltd serves as the principal consultant, AEC, as the local partner, facilitates engagement with various stakeholders and facilitates knowledge transfer. It’s essential to differentiate between the STMMP and EPCS contracts: the former involves upgrading the existing STMP to guide the Lagos State Government on transportation infrastructure development, whereas the latter pertains to implementing recommendations from the current STMP and is Rinanced by AFD.

4. Consultancy Service for the detailed engineering design and supervision of construction of quality bus corridor package 1 (Ketu/Alapere, Yaba-Lawanson- Cele), Package 2 (lju Ishaga-Abule Egba) and Package 3 (lyana-Iba-Igando) including design and supervision of ITS for 4 Nos of quality bus corridors. (N7,361,406,710)

Response by LSPPA:

The Detailed Engineering Design and Construction Supervision procurement for Quality Bus Corridor Package 1, 2 & 3 commenced in December 2019, culminating in the award to AEC/GPO S.A. in September 2021. Subsequently, the contract underwent revision to incorporate an Intelligent Transportation System (ITS) component. After Rinalizing this process, a revised award was ofRicially issued in April 2023, following thorough certification by AFD.

5. Consultancy Services for the engagement of Loan Facilitator and Adviser on LRMT blue line project (N2,101,321,622)

Response by LSPPA:

The consultant played a key role in securing funding for the Blue and Red Lines through local Nigerian banks, a shift from the initial plan of acquiring a USD loan from the international community. This strategic move mitigated the State’s exposure to exchange rate risks. Negotiating the fee down from 5% to 2.5% was another achievement. The operational Blue Line stands as a testament to the successful completion of the project within the stipulated timeframe, showcasing its numerous associated beneRits. The decision averted the risks associated with Rluctuating exchange rates, ensuring stability and fostering favorable outcomes from the investment.

6. Consultancy Services for the engagement of Loan transaction arranger and Financial Adviser to LASG/LAMATA on the Red line project (N3,141,666,667)

Response by LSPPA:

7. Rehabilitation / Reconstruction/ upgrade of Eti-Osa / Lekki / Epe Expressway (Phase 2b) from Greensprings to Abraham Adesanya in Eti-Osa and Ibeju- Lekki LGA (N69,936,201,915)

Response by LSPPA:

The contractor who has previously been prequalified was already engaged in on-site operations, specifically focusing on the road infrastructure starting from the T junction in the Epe axis. Notably, the road structure is primarily concrete-based, and the contractor has initiated the project using its internal Rinancial resources for up to 50% of cost. Subsequent disbursement of funds by the LASG is planned to span across over 24months utilizing an ISPO. Moreover, the BOQ pertinent to this project has undergone thorough assessment and scrutiny by the OfRice of Infrastructure to ensure accuracy and appropriateness in line with the project’s scope and speciRications.

8. Construction of identiRied strategic roads across the state in Alimosho LGA (2Roads), Ikeja LGA (3 Roads), Ifako ljaiye LGA (6Roads) and Kosofe LGA (4Roads) (Lot 3) (N6,047,509,151)

Response by LSPPA:

The BOQ underwent comprehensive evaluation conducted by OfRice of Infrastructure, ensuring meticulous scrutiny and validation of the project’s quantitative aspects. Simultaneously, the Ministry of Transportation remains actively engaged in project oversight. This involvement facilitates the implementation of necessary trafRic diversions, supported by the deployment of trafRic ofRicers at strategic locations to guarantee uninterrupted trafRic Rlow during project execution.

Payment disbursement for projects adheres to a certiRied measured works framework, ensuring that the total allocated sum is not released in a single transaction. Instead, payments are processed incrementally based on certiRied progress, with an initial advance payment set at 40% of the total project cost.

Regarding the restoration of deteriorated roads, the Lagos State Government’s Public Works Corporation shoulders the responsibility of rectifying such the effective rehabilitation of dilapidated road networks across the state

9.Procurement and Construction and Design, Build Operate and Maintain PPP Model for the Blueline Rail (N9,714,179,610)

Response by LSPPA:

During the initial stages of project conceptualization, the contractor was tasked with executing the project under a Public- Private Partnership (PPP) framework entailing the Build, Operate, Maintain, and Transfer model. Following due process, the contractor successfully secured the project bid. However, it became imperative to develop a comprehensive and detailed design to accurately estimate the project cost. Design considerations constitute a substantial segment, accounting for approximately 15% of the overall project expenditure.

In the pursuit of facilitating the PPP arrangement, Rinancial backers stipulated the requirement for a Fiscally Backed Irrevocable Standing Payment Order (ISPO) supported by the Federation Account Allocation Committee (FAAC). Regrettably, the Lagos State Government (LASG) was unable to comply with this condition. Given the critical timing and signiRicance of the project, LASG made a strategic decision to independently Rinance the Engineering, Procurement, and Construction (EPC) component of the project.

This intervention proved pivotal, expediting the project’s progress signiRicantly, particularly in advancing the power plant construction phase to an advanced stage. Notably, while the entirety of the project remains under the PPP framework, this speciRic segment was funded by the State owing to the exigencies of the project timeline and its strategic importance.

10. Provision of Support Services for the Multi-biometric search service (MBSS) platform for the deployment of disaster recovery site and upgrade of Database infrastructure from 10M to 20M to the agency. (N7,991,930,559)

Response by LSPPA:

The Project extends across a duration of three years, necessitating funds to be allocated across multiple budget cycles rather than sourced from a single Riscal period. Notably, this initiative serves as a continuation of an ongoing contract, encompassing the augmentation of services to integrate a disaster recovery site within its scope.

11. Special Committee on Rehabilitation of Public Schools (N5,813,169,527)

Response by LSPPA:

SCRPS was re-established by Mr Governor with an Executive Order on the 4th of Nov 2019. Having existed and operated by previous Administrations, it was re-introduced as a committee with the primary mandate to address the decay in the physical infrastructure in public schools. They work with the Ministry of Education for proper project identiRication and justiRication. SCRPS is subject to both State audit and external audit and other internal monitoring Agencies. They follow the State PPA laws on contract award up to project close out. All payments are executed from the State Treasury Office, after due certification by other monitoring State Agencies.

12. Lagos State Infrastructure Asset Management Agency – Various Projects – N4,289,471,036

Response by LSPPA:

LASIAMA, operating within the mandate of managing Lagos State assets and infrastructure plays a pivotal role in streamlining facility management across the state. The prevailing model, wherein LASIAMA administers facility management contracts while various MDAs occupy and utilize these facilities, is a strategic approach designed to centralize and optimize resource utilization. This model facilitates a framework, ensuring uniform standards of maintenance and efRicient resource allocation.

13. Supply and distribution of 2,000 Noiler Chicken across the local government areas and wards in the state (N18,468,000)

Response by LSPPA:

This falls under the socio-political responsibilities of government to cater for its citizens

14. Procurement of a brand new Lexus LX 600 Bullet Proof Sport Utility Vehicle for use in the Pool of Office of Chief of Staff (N440,750,000)

Response by LSPPA:

This is in tandem with current economic realities.

15. Replacement of the liquid fragrance in the Office of Mr Governor, Lagos House, Ikeja (N7,475,000)

Response by LSPPA:

This covers the entire 2023 period of one year. It is also not limited to Mr Governor’s ofRice but extends to several ofRices and state houses.

16. Decoration of Venue for Political Delegates Congress (N20,804,550)

Response by LSPPA:

This was a strategic programme aimed at fostering interaction and collaboration between elected legislators and members of the State Executive Council. Its objective was to provide a conducive environment that encouraged dialogue, exchange of ideas, and cohesive engagement among these stakeholders.

17 and 18. Flying Hour Expenses on Ad-hoc Charter Plane by Lagos State Government (N400,000,000) (N112,500,000)

Contractor: Caverton Helicopters

Response by LSPPA:

This payment accounts for past services rendered, wherein outstanding debts owed to the contractor is being reconciled and offset by this specific Rigure.

19 and 20. Procurement of TEN (10) UNITS brand new Hyundai County Buses for use in the Pool of the Office of the Chief of Staff (N600,000,006)

Procurement of TEN (10) UNITS brand new Hyundai County Buses for use in the Pool of the OfRice of the Chief of Staff (N1,599,999,986)

Response by LSPPA:

The Chief of Staff holds oversight responsibilities across multiple MDAs within the State. However, it’s important to note that these buses are designated for the use of other MDAs within the State and are not allocated for the personal use of the Chief of Staff.

21 and 22.

Monthly outreach of indigent citizens by wife of the Deputy Governor (N30,000.000)

Monthly empowerment programmes of the wife of the deputy governor (N30,000,000)

Response by LSPPA:

This amount represents an annual sum, with a monthly expenditure of N2.5 million for each item above.

23. Provision of Supply items (Rechargeable fans, rechargeable lights and fridge in Office of the Deputy Governor (N2,017,840.00)

Response by LSPPA:

This is not the case. The contract is for N2,017,840.00 and this is what is contained on the Agency’s website and the registered Letter of Award.

24. Collation of Revenue Data and the Review of the current Lagos State Revenue Allocation Indices in Line with Revenue Mobilization Allocation and Fiscal Commission Call Circular (N778,000,000)

Response by LSPPA:

The core objective of this project is to conduct a comprehensive reassessment of Lagos State, aligning it with the standards set forth by the Revenue Mobilization Allocation and Fiscal Commission. This initiative necessitates extensive data collection conducted by local government officials at their respective levels. As a result of the time constraints faced by LASG, a consultant was engaged. The project entails training, meticulous data analysis, and oversight by the commission to evaluate the ongoing efforts.

25. Commission and Operation Start-Off support of Lagos Rice Mill Imota. (N300,000,000)

Response by LSPPA

The collaboration with WACOT is not a Public- Private Partnership (PPP) but a technical service arrangement intended to bolster the Imota Rice Mill. This partnership involves the provision of expertise from both expatriate and local staff, leveraging their experience in similar machinery and processes from Argungu, Kebbi State. It’s crucial to note that the mill remains the property of LASG; the collaboration primarily focuses on training. WACOT has deployed 7 expatriates and 16 support staff to facilitate the initial operations and eventual self-sufRiciency of the mill. The initial allocation of 300 million Naira was intended for disbursement at 50 million Naira monthly over a six-month period. However, due to an expanded scope, this figure has been revised to 540 million Naira, allowing for a monthly disbursement of 60 million Naira for further 9 months totaling 15 months.

26. Renewal/Extension of Technical Support Services for the Management of Operations of Lagos Rice Mill Imota. (N540,000,000)

Response by LSPPA

The collaboration with WACOT is not a Public- Private Partnership (PPP) but a technical service arrangement intended to bolster the Imota Rice Mill. This partnership involves the provision of expertise from both expatriate and local staff, leveraging their experience in similar machinery and processes from Argungu, Kebbi State. It’s crucial to note that the mill remains the property of LASG; the collaboration primarily focuses on training. WACOT has deployed 7 expatriates and 16 support staff to facilitate the initial operations and eventual self-sufficiency of the mill. The initial allocation of 300 million Naira was intended for disbursement at 50 million Naira monthly over a six-month period. However, due to an expanded scope, this figure has been revised to 540 million Naira, allowing for a monthly disbursement of 60 million Naira for further 9 months totaling 15 months.

27. Procurement of Consumables like Threads, Charcoal, Wood, Sand, Personal protective equipment, hiring of trucks and servicing of generator plants for the second quarter operation of Lagos Rice Mill Imota. (N24,721,650)

Response by LSPPA

The contractor’s proven expertise in supplying these consumables led to the establishment of a framework agreement, enabling the consistent provision of these items over an extended period.

28. Procure Fuel for the State, Fire and Rescue Service’s Operational Activities. (850,700,000)

Response by LSPPA

Procuring fuel for Fire Service in this manner aligns with the state’s public procurement goals which includes encouraging SME involvement. Involving smaller contractors supports SME participation and ensures operational flexibility. The contract is payable monthly at N70million and covers 20 Fire stations.

29, 30 and 31

Implementation of Feasibility Study for Lekki-Epe International Airport (195,000,000)

Restoration of Water Supply at Iduganran Palace (152,116,326)

Proposed Adesalu Health Care Center at Onasa Community Ibeju- Lekki (159,314,907)

Response by LSPPA

The dwindling revenue cannot be substantiated and does not reflect the true position at Lotteries Board. The enabling law creating the Board empowers it to allocate funds for expenditure relating to certain objectives including educational, infrastructural, health care and environmental objectives.

32 and 33.

Procurement of 40 Nos of Vehicle Tyre Clamps 1st Batch for the Agency (9,589,000)

Engagement of the consultancy on operations management monitoring and customer tools for Lagos State parking authority (405,456,363)

Response by LSPPA

The figures provided lack substantiation and the source is unreliable. Without verified Financial data, making assumptions about the agency’s revenue generation, operational model, or enforcement strategies leads to flawed conclusions

34 and 35

Supply of Transformers and Electricity Accessories (36,367,366)

Rehabilitation and reconnection of IPP high voltage distribution (599,980,515)

Response by LSPPA

The Lagos State Electricity Board functions as a pivotal agency overseeing various aspects of electricity provision and regulation within the state. Its primary responsibilities encompass power distribution oversight, infrastructure development, policy formulation, and implementation related to electricity generation, transmission, and distribution. Additionally, the board addresses consumer services, handling complaints, ensuring affordable access to reliable electricity, and conducting consumer education programs. It plays a regulatory role in tariffs, licensing, and quality standards for electricity services while promoting the integration of renewable energy sources into the state’s electricity supply. The importance of LSEB can therefore not be over- emphasized. In addition, the overhead of LSEB is expended on streetlights, diesel, payment for IPPs etc.

36. Renovation of Saint Andrews Anglican Church, Oke-Popo, Lagos (531,553,559)

Response by LSPPA

The Church was founded in 1889 and stands as a significant historical landmark in Lagos State. The need for the State to preserve such landmark can therefore not be overemphasized. The contract amount encompasses funds allocated for both the refurbishment of the Church and compensation given to the church for the necessary demolition of sections of its property due to road expansion.

37. Construction of Erelu Way / Dayo Eluk Community Link Road, in Amikanle Community the Agbado-Oke Odo LCDA (511,539,758)

Response by LSPPA

CERUD’s mandate encompasses providing essential amenities to rural areas, and the project spans across multiple budget cycles.

38. On-boarding of four MDAs and Twenty- nine Hospitals unto (379,500,000)

Response by LSPPA

The Lagos State Public Procurement Agency operates under a governance framework that ensures rigorous oversight and control mechanisms beyond its internal procurement policies. The agency’s activities are subject to meticulous scrutiny and audit processes conducted by both the Lagos State House of Assembly and the Office of the Auditor General.

39. Consultancy Services for the engagement of monitoring and evaluation specialist for NG-CARES
Implementation in Lagos State (315,600,000)

Response by LSPPA

This is a world bank project under the Program- for-Results (PforR) Financing instrument. Its unique features include linking disbursement of funds to the achievement of specific program results and supporting clients in enhancing the effectiveness and efficiency of their development programs to achieve tangible and sustainable results. The project is currently ongoing in all 36 States of the federation.

40. Public Relations and Whistleblower strategy for the ministry of physical planning and urban development
(269,000,000)

Response by LSPPA

The project involved a comprehensive nine- month enumeration and sensitization campaign conducted by the consultant throughout Lagos State. This initiative also involved the engagement of diverse stakeholders within the informal sector, with a primary focus on augmenting data collection, fostering community awareness, and promoting regulatory compliance.

41. Transformation Agenda for Office of Internal Audit (100,000,000)

Response by LSPPA

This was an extensive capacity building program for all Auditors statewide and a process re-engineering drive.

42. Capacity building and Competency Framework for Office of Internal Audit (100,000,000)

Response by LSPPA

The consultant, with a wealth of experience in works projects, was enlisted to conduct statewide training for auditors. The focus was on imparting prepayment inspection protocol expertise alongside comprehensive project management skills.

43. Procurement of 5 (Five) Brand New 2023 Mikano Changan Dynamic Saloon Vehicles for 5 lucky winners in the senior category during the recently concluded Y2023 Public Service Week (83,796,250)

Response by LSPPA

The distribution of 5 vehicles during the Public Service Week aimed to recognize senior civil servants’ dedication and boost morale. The goal of this gesture, is to foster productivity among public servants.

44. Procurement of Fuel for Lagos State Emergency Management Agency Operational Activities for the Month of April (74,524,650)

Response by LSPPA

Procuring fuel for LASEMA in this manner aligns with the state’s public procurement goals which includes encouraging SME involvement. Involving smaller contractors supports SME participation and ensures operational flexibility.

45. Renovation of IOGC’s Retail Fuel Station Located at Km 44 Lekki-Epe Expressway Ikota- Lekki, Lagos (68,000,000)

Response by LSPPA

The renovation of IOGC’s retail fuel station aligns with LASG’s role as a major shareholder in the organization. It’s a contribution towards improving infrastructure within the state, not a competition with private businesses. LASG is committed to enhancing services for the public and addressing separate challenges like road works and traffic through other initiatives.

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