NIGERIA: National Assembly Chides NPA, Terminal Operators over Alleged Revenue Leakage

The National Assembly has chided the Nigerian Ports Authority (NPA) and the concessionaires of the nation’s seaports over their various roles in alleged revenue leakages accruing to the federation account.
The National Assembly stated this when the Senate Committee on Privatization led by its Chairman, Senator Gbenga Obadara on a fact finding mission visited the NPA House, the corporate headquarters of the authority in Lagos as well as taking a tour of two major terminals at the Tin Can Island Port (TCIP), namely Five Star Logistics Terminals and the Josep Dam Terminals.
The committee after the tour expressed dissatisfaction at the poor implementation of the financial agreements in the port concession agreement, as signed by NPA and the terminal operators.
Apparently not happy with the state of things in the port, members of the committee lamented that appreciable revenue that should have accrued to the country is being lost because the concessionaires have failed to remit their financial obligations to the NPA.
The Senators also gave knocks to the NPA for not providing needed infrastructures at the terminals, and for failing to keep accurate tab on the remittances from the concessionaires.
Addressing the NPA management team at its headquarters in Marina, Lagos, Obadara stated that considering the volume of cargoes coming to the port, what the terminals are remitting is peanuts.
His words: "We are not happy about the activities, considering our port as the biggest in Africa, and what the terminals are generating is peanuts. At Five Star Logistics, $66,00 is being collected, converted to 126 million, and we observed that there was a tax relief for five years, so they were making good money, but by 2012 they were recording N54 million loss. This does not follow accounting integrity and we are not happy about it. The committee spent more than 25 minutes at Tin Can Island Port and surprisingly, the terminal operators were unable to provide receipts of the monthly remittances to NPA”.
According to the legislator, we need money to finance NPA’s budget and if the operators cannot tell us where the money is, NPA should be able to tell us. At Josep Dam, we waited for more than 20 minutes and they cannot provide us what they were making monthly. They were not able to give to us figures needed. The terminal operators complained of the delay in completing port rehabilitation, the access road which has affected quick delivery of cargoes and low profit margin.
At Josep Dam terminals, he observed that the NPA had failed to provide fenders for the terminals after it was broken for eight months, a situation which has rendered the terminal redundant.
Other problems observed by the legislators apart from the financial failures were seepage along the quay apron at Five Star Logistics Terminal and the bad access roads to the port.
The Managing Director of the NPA, Alhaji Habeeb Abdullahi in his response assured the Senators that fenders are already on ground to repair the quay wall of the ports.
He said that the revenue from the terminals have dwindled due to government policies on vehicle, rice and cement importation. According to him, there is need to review the port concession agreement in order to allow new suggestions and improvement.
He defended the terminal operators saying that there was need to review the agreement reached with them after five years of operation.
According to him, the terminals are not getting their guaranteed minimum tonnages, therefore there is need to take a second look at the concession agreement. For instance, Energy Nigeria Limited has complained of drop in revenue as a result of the ban on importation of cement which has caused a drop by 40 per cent, while the duty payable on rice also dropped by 15 per cent.
The import policy on fish has also affected their business and we have to keep looking at the changes so that NPA will keep reviewing the agreement.
Continuing, the NPA boss said: “Five Star Logistics says the policy on importation of cars may also affect its minimum tonnage in 2015. There is an ongoing supply of fenders which is going to be used in all the ports. It will soon be cleared and delivered to us, therefore it will soon be a thing of the past. "The seepage at five star logistics is an isolated case and we will jointly inspect it".
NPA Executive Director, Engineering and Technical Services, Mr. Mohammed Sani Sally disclosed that the processes in the award of a contract for the dualization of the port approach to the Tin Can Island Port, Apapa has gone far.
Said he: “It has passed the parastatals tenders board. It is already at ministerial level.”

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