From Juliana Taiwo-Obalonye, Abuja
The Federal Executive Council (FEC) has ordered the buyers of two seized properties in Lagos to pay government the cost of the prevailing price in 2001 when they were purchased.
This amounts to N18 million and N21 million (39 million) to be paid for the Lagos-based properties earlier purchased for N5 million and N2 million (N7 million) respectively.
The buyers are to pay N32 million outstanding balance after 21 years, which is the prevailing price at the time.
Minister of Works and Housing, Babatunde Fashola, made the disclosure at the end of the Federal Executive Council (FEC), presided over by President Muhammadu Buhari.
Fashola, briefing State House Correspondents, explained that government was short paid in the transaction.
He said the properties, a four-bedroom bungalow on Adeniyi Jones Lagos, and five-bedroom duplex on Amadasun Street in GRA, Ikoyi, Lagos were seized by the National Drug Laws Enforcement Agency (NDLEA) in the course of narcotic prosecution.
He said government now wants the buyers to pay the sum of N18 million for the bungalow and N20 million for the five-bedroom duplex being the cost at which they were valued in 2001.
Fashola, who declined to disclose the identity of the buyers and the narcotic dealer who the NDLEA confiscated the properties from, said: “They were properties sold as a result of a prosecution for narcotics by NDLEA. So, they were proceeds of drug crimes, but the valuation process followed the NDLEA Act instead of the Financial Regulations Act. So essentially, those policy proposals were approved by the government.
“The addresses of the properties, the first one is a four-bedroom bungalow with two room boys’ quarters at Adeniyi Jones in Ikeja Lagos, and the other one was a five-bedroom duplex with two room boys’ quarters at Amadasun Street, GRA Ikoyi, so they were sold for N5m and N2m respectively in 2001.
“At that time, the valuation we got was that if they were properly valued, they should have been sold for N18m and N20m respectively,” the former Lagos governor explained.
He noted that the NDLEA Act of the time gave precedence to the directives from the Ministry of Justice and regulations were made according to powers under the Act.
“But they did not take cognizance of the procurement law and the financial regulations of the time.
“So, we are now saying, going forward, the financial regulations must take precedence. So, those are all proposals that will come as a new law when the Ministry of Finance finishes with them, so that you cannot have different regulations for disposal of assets that have been forfeited to the government. They must be subject to one superior procedure,” he added.
The minister also said that the council approved a policy recommendation to extend the usage life of government assets such as plants, equipment, land, property and machinery.
The new recommendation, Fashola said, will ensure proper disposal while saving government expenditure.
He said “The purpose of the policy memorandum was to seek better enforcement of the financial regulations of the government, especially the revised 2009 regulations with regards to valuation process for plants, equipment, land, property and machinery, and also how they are disposed of when they reach the end of life.
“This policy is premised on Executive Order 11 that enthrones maintenance as a conscious government policy. And we think that because of that, government assets should last longer than the life cycle usually prescribed in the existing financial regulations, such as four years and nine years for other classes of machinery.
“The other context behind the policy was also in order to help the government manage expenditure in the face of revenue challenges on certain items of governance. For example, if you slow down the depreciation policy on vehicles, your replacement rate slows down as well.”
He added that “with the new approval, the depreciation threshold for vehicles changes from four to six years.
“Plant and machinery would also have a 10-year depreciation period instead of the existing timeframe in the financial regulation.
“Also, the ministry proposed a strategic percentage depreciation rate per year for vehicles with two litre-engines and those above two liters.”
To ensure proper accountability, Fashola said Ministers will now be fully involved in the procurement process as they must now sign off requests for valuation of properties of their respective ministries, departments and agencies.
“We also proposed that heads of the Ministry as accounting officers must sign off now on request for valuation of properties, especially when agencies are trying to buy properties.
“We’ve seen that sometimes ministers are not even aware that proposals are being made for acquisition of some type of assets. Essentially, the council approved all of the policy recommendations. They should go to the Ministry of Finance, who is in charge of making the financial regulations in order to effect the necessary regulation,” he added.
Council has approved the sum of N28.1 billion for the augmentation of road and other infrastructural projects in Wasa District of the Federal Capital Territory (FCT).
The Minister of the FCT, Mohammed Bello, explained that the augmentation was as a result of inflation which has overtaken initial approval of N56 billion for the Wasa District projects.
He puts the total project sum at N85 billion with a completion period of 42 months.
Minister of State for Petroleum Resources, Timipre Sylva, who equally briefed, also disclosed that the Council approved the sum of N2.044 billion for the construction of internal road and facilities at the Gas Hub in Bayelsa state.
The Minister added that the Port Harcourt Refinery would be completed and resume production by December this year.
This came as the Minister of Works and Housing, Babatunde Fashola, described as unhelpful and insensitive recent disruption of traffic along Lagos-Ibadan Expressway by the members of National Association of Nigerian Students.