The Office of the Auditor General for the Federation has queried the management of the Ogun-Osun River Basin Development Authority for selling off government plant, property and equipment valued at over N2bn at a paltry sum of N13.618m.
The House of Representatives’ Committee on Public Accounts has consequently summoned the Minister of Water Resources and the Permanent Secretary of the ministry to explain the auction.
The committee had on Friday grilled the Managing Director of OORBDA, Olufemi Odumosu.
At the investigative hearing, Odumosu justified the disposal, telling the committee that the PPE were sold off by the auctioneers appointed by the Federal Ministry of Water Resources, who also approved the auction.
Records of the auctioned assets showed that an 800KVA Perkins diesel generating set bought by OORBDA in 2006 for an undisclosed amount was sold for N550,000 in 2018 after it was categorised as ‘unserviceable.’
Also, a CAT payloader bought for N70,000 in 1982 was sold for N40,000, while other earth-moving equipment like bulldozers, graders and escalators were sold for between N350,000 and N550,000 as unserviceable items.
On the list is also a Toyota Camry 2.5L bought in 2013 for N8.150m, with a book value of N1.222m, which would have cost the agency N1.2m to repair, was sold for N22,500.
Similarly, trimmers bought in 2004 and lawnmowers bought in 2005 were sold for N2000 and N6500, respectively.
OORBDA also disposed of off three Peugeot 504 station wagons bought for N2.9m each for N26,400 each, while a Mitsubishi Canter lorry which cost the authority N8.55m was sold as scrap for N80,000, with a DAF (1000) lorry bought for N5m auctioned for N90,000.
The authority also sold a Toyota Hilux pick-up van bought for N3.75m, which would have cost N187,500 to repair, for the same N187,500.
Odumosu told the committee that the auction was transparent and was carried out under the supervision of the ministry.
He stated the PPE auctioned dated back to the late 1970s and early 1980s, whereas the documents presented to the lawmakers showed that the oldest of the property were bought in 1980, while the newest of them was bought in 2013.
While being grilled by the lawmakers, Odumosu sought to withdraw the documents and replace them with another, a request the lawmakers declined.
The MD had said in his written submission dated May 16, 2022, that “your (committee’s) observation which is, however, noted was premised on the fact that at the time of disposal, the authority could not hand on all schedules of historical cost relating to these unserviceable items.
“This primarily was because they (unserviceable items) were procured dating back to the late 1970s to early 1980s at the commencement of the operations of the authority spanning over a 35 to 40-year period
“Meanwhile, most officers directly involved in the purchase had either died or retired or both. However, through frantic efforts made (in the past which has been resumed) at recalling relevant living retirees to assist in archival retrieval of records relating to the purchase of the items had yielded significant results.”
The Chairman of the committee, Oluwole Oke, however, criticised the auction while also questioning the mode of selecting the auctioneers and the usurpation of the function of OORBDA’s board by the ministry.
Oke pointed out that the provisions of the Public Procurement Act were not followed in the sale of the items, resulting in a possible loss of revenue to the government.
Consequently, the committee asked the Minister of Water Resources and the Permanent Secretary to appear on June 9, 2022, to explain their role in the auction.
The Deputy Chairman of the committee, Abdullahi Abdulkadir, also asked the authority to submit the valuation report carried out on the items before they were sold, adding that the letter from the ministry to the auctioneers stated clearly that the items must not be sold below government valuation.