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Finally, the Senate has begun a probe of the various agreement signed during the 2013 power sector reform in its efforts to find a lasting solution to the problem in the sector.
The probe being handled by the Senate Committee on Power and will focus more on Power Sector Recovery Plan and the impact of the Covid-19 pandemic follows the dashed expectation of the Nigerian government and the citizens on the power sector privatisation which many thought will improve the supply and stabilise electricity in the country.
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The Power Holding Company of Nigeria was in 2013 unbundled to pave way for the emergence of six Generating Companies(GENCOs), 11 Distribution Companies(DISCOs), and one Transmission Companies of Nigeria. Both the GENCOS and DISCOs are fully privatised outfits.
The Senate President Ahmed Lawan at the opening of the probe said: “When you have privatization, you have Share Purchase Agreement. This investigation should look at what has happened.
“What are the responsibilities and obligations of the Federal government in the Share Purchase Agreement. What is BPE(Bureau of Public Enterprises) supposed to do?
“And equally and very important, what are the successful investors who are given 11 DISCOs and Six GENCOs supposed to do and within which time framework.
“Government should not be giving free money. N1.8 trillion has been given to DISCOs maybe in their books. The actual money might have been given to the GENCOs.
“N1.8 trillion is a huge amount of money. Is it part of the Share Purchase Agreement that we should be given this kind of money or what are we supposed to do as a government. What is our obligation?
“Government cannot afford to just spend money that you hardly understand why it is given and I will advise the Executive here, next time, if there will be any next time, to give such money, bring it to the National Assembly for approval.
“We want to be very critical of how funds are given to privatized enterprises. We expect that by now, our level of generation, transmission, and distribution would have been far better.”
Lawan, however, said he would rather call for a review of the privatisation deal and not for an outright cancellation of the deal.
“Why I will not call for an outright reversal of the privatization that was done in 2013, I believe the time has come for us to review it. If those who are in charge now don’t have the financial muzzle, please let’s admit that we should look for partners who will come in with more funds.
“If the government cannot fulfil its obligations because it holds 40 per cent, let it divest so that we don’t hold this sector unnecessarily stagnant,” Lawan said.
The Senate President said Nigeria could not have made any serious, meaningful, and sustainable progress without power and that is how we have been very concerned at the Senate”.
“I believe that we all understand why Nigeria has remained undeveloped especially when we are talking about manufacturing, empowering our artisans, the vulcanises, the barbers who have no electricity o work with”.
“Last year, we signed the Africa Continental Free Trade Agreement. How can Nigeria take advantage of that agreement without power because we cannot produce anything in a competitive environment here? So Nigeria will be a dumping ground.
“Jobs which ordinarily should be for Nigerians will have to be exported out. So as representatives of the people, in the Senate, we believe that we need to up our game to ensure that this sector, a very vital and important sector, receives the king of attention the government should give it.
“Some authorities say we lose about $29 billion every year because of lack of sufficient and stable power. That is equivalent to what our people are supposed to earn.
“The purpose of privatization, just to remind us, is not for the government to wash away his hand, to run away from responsibilities.
“Its an admission by the government that, first, it doesn’t have the resources required to move this sector forward.
BADEJO ADEMUYIWA has 23 years experience as a Finance Writer, specialising in Insurance and Investigative Reporting.
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