- The power firms must account for the previous loans before seeking new ones
When, in 2014 the Goodluck Jonathan administration announced N213billion facility for the stakeholders in the power sector, the idea was to help them improve power generation and distribution in the country. The money was supposed to be disbursed in batches, with the first batch disbursed February 2, 2015.
Although only about a third of the fund was reported to have been released, the money, like other funds spent on the power sector has not made any dent on power supply. This is why many Nigerians, including members of the House of Representatives are curious that the power firms want another N309bilion loan guaranteed by the Federal Government, which the Federal Ministry of Power, Works and Housing says is to cover the electricity market shortfall of N187b in 2015 and a projected shortfall of N122b for this year. The earlier intervention fund was provided by the Central Bank of Nigeria (ÇBN) through the Nigerian Electricity Sector Intervention Facility.
We support the representatives for their inquisitiveness; that is the way it should be in a democracy, especially concerning their oversight functions. As elected representatives of the people, they should be concerned about how public funds are spent. As the lawmakers said, we need to know how much specifically of the initial N213bn was actually released, and how the disbursement was spent.
But, one thing is certain; power supply has remained as epileptic as it has been for years. In spite of the funds pumped into the sector by successive administrations, even since the return to civil rule in May 1999 alone, the sector has remained a jigsaw puzzle in that the more money is pumped into it, the more it keeps gulping more without appreciable result.
But, if the Jonathan government spoon-fed the electricity firms, the Buhari administration cannot afford to do same. One, government revenue has dropped significantly in the last 18 months. Secondly, the present administration came in on the mantra of change, which means it cannot do things the way the carefree and corrupt Jonathan government did, which partly explains why we caught cold as soon as crude prices nosedived. The Jonathan government did not provide for the rainy day as confirmed by its finance minister who also doubled as coordinating minister for the economy, Mrs Ngozi Okonjo-Iweala. The stupendous amount that has been committed to the power sector in recent years alone without result is enough indication that the solution does not lie in throwing money at the problems in the sector.
It is over two years that the new owners of the power firms took over from the defunct Power Holding Company of Nigeria (PHCN). That they have not been able to find their feet shows that something was wrong with the process through which they came in or the due diligence that they were supposed to have done. Could it be that the owners had hoped the Jonathan government was going to be in government beyond May 29, last year, in which case the government would keep pumping public funds into them while the firms too would reciprocate by donating generously to the government’s cause, or the cause of the then ruling party?
Whatever it is, the Federal Government has no business granting loans to the power firms or securing any bond for them. These are business concerns that should in their individual capacities be able to approach their banks for loan like most other commercial entities. If they cannot convince the banks to give them funds, then something is wrong. The government can begin to think of reviewing the sale of the power entities within the ambits of the law if its intention to give Nigerians light is ever to materialise.
As things stand, it is doubtful if the present owners can make any difference. We cannot continue to pump public funds into strictly private concerns.
