The Department of State Security Service (DSS) has started probing contracts awarded by the military and other security agencies.
The probe includes arms procurement in the past few years.
It was also learnt that some contractors were detained by the military for about 24 to 48 hours for quizzing.
The names of the contractors were however kept under wraps as at the time of filing this report.
But the affected contractors were released after making relevant documents available to the security agency.
According to investigation by our correspondent, the ongoing findings border on four pegs including:
*alleged extra-budgetary spending on military hardware and the sources of funding;
*what became of the $1billion approved for arms purchase by the National Assembly;
*the sources of the $15million seized by South Africa
*why the military budget had declined in the last five years or whether or not the military budget had been diverted to other use; and
*likely cases of mismanagement.
It was gathered that the presidency was disturbed that some of the immediate past Service Chiefs had complained of lack of equipment contrary to the records available to the government.
Although the former National Security Adviser (NSA), Mr. Sambo Dasuki, had clarified that enough modern arms and ammunition, the government has set out to find out how much was spent on arms, the actual Defence budget, what was released and spent.
A reliable source, who spoke in confidence, said: “The DSS has launched a discreet probe into award of contracts, procurement and extra-budgetary votes by the military and security agencies in the past five years.
“Some contractors were detained and grilled for about 24 to 36 hours before they were released to their lawyers. Some of the contractors will still be re-invited as the probe progresses.
“Where contracts were duly awarded, the DSS only screened the process and confirmed execution. Some procurements were also verified.
“The job is however easier in some cases because one of the present Service Chiefs was in charge of procurement in his service.”
One of the affected contractors confirmed invitation by DSS to our correspondent.
The contractor said: “I was asked to present my contract papers, due process approval and the execution. They were civil because after presenting all the details, I was left off the hook after 24 hours.
“This is why it is not good to cut corners in any business one is doing.”
It was however learnt that the DSS will look find out whether or not the $1billion external loan sought by the administration of ex-President Goodluck Jonathan was approved.
The 7th Senate had on September 25 approved President Goodluck Jonathan’s request to borrow a $1bn external loan to buy arms and hardware fight insurgency in the country.
The source added: “The ongoing investigation will help to find out if the loan was fully accessed or not, what it was spent on and what gaps to be filled.
“It is not a witch-hunt but if you go through the report of the Transition Committee of Jonathan, there were so many gaps to fill.
“There were allegations of underfunding, short-changing of military budget, extra-budgetary spending, and unnecessary debts.
“We also got reports that some military equipment ordered from abroad are still being expected.
“There is need to reconcile all these records. If there are infractions, those concerned will be prosecuted.
“In all, the report of the Ministry of Defence was not at par with the votes spent on the arms in the Armed Forces and security agencies.
In a report to the Federal Government Transition Committee, headed by ex-Vice President Namadi Sambo, the Ministry of Defence said the defence budget has declined under the administration of ex-President Goodluck Jonathan.
Out of N445.309billion voted for the ministry in five years, about N273.831billion was actually released.
The withheld amount was about N171.478billion.
Also, the ministry had an outstanding liability of N26,830,532,161.24 including N2,618,509,462.05 and $20,962.96 incurred on capital and overhead expenditures and excess commitment of N24,212,022,699.19 on Peace Support operations
The breakdown of the report shows that the Federal Government budgeted N445.309billion for the Ministry of Defence between 2011 and 2015 as follows N213.122billion (capital) and overhead (N232.187billion).
Out of the N213.122billion capital votes, only N110.916 billion was released.
Concerning the recurrent budget, out of N232.187billion, about N162.915billion was released
The report said in part: “There has been consistent decline in both Capital and Overhead allocations to the Defence Sector in the past five years (2011-2015) as shown in the table below. In spite of the limited funds the responsibilities of both the Ministry and its agencies are increasing on a daily basis. Mostly with the level of insecurity arising from insurgency in the North-East, Niger Delta and other flash points in the country.
“Follow the inadequacy of regular funding for Peace Support Operations (PSOs), N35,000,000,000.00 (thirty five billion naira only) Bond was raised at 9.75% per annum in 2008 to equip Nigerian troops engaged in various UN missions.
“The equipment procured were delivered at the Nigerian Arm Ordinance Depot, Lagos for onward deployment to mission areas under the supervision of the Defence Headquarters. However, it should be noted that Contingent Owned Equipment (COE) attracts reimbursements from the United Nations Peace keeping which account is domiciled with CBN UN Account General of the Federation and utilized for the repayment of the Bond. So far, the sum of N27.3 billion has been repaid for the loan taken.
“However, following a request by the ministry to Mr. President for the transfer of control/management of the Armed Forces Peace Keeping reimbursement account from Nigeria Permanent Mission in the UN to the Defence Section in New York from where the funds will be remitted into the MOD account, the request was graciously approved and it is expected that with the transfer, funds would be easily accessed and utilized more judiciously for the maintenance and upgrade of the equipment.
“The repayment schedule due to non-regular remittance of funds from the Defence Section in New York to the ministry, which therefore affected the loan payment which hitherto was to be fully paid in June, 2015 but will now be paid on a quarterly sum of N1,284,122,196.23 with effect from 30th June, 2015 to 30th September, 2017
“The Ministry has an outstanding liability of N26, 830,532,161.24 and $20,962.96. This is made up of N2,618,509,462.05 and $20,962.96 incurred on capital and overhead expenditures and excess commitment of N24,212,022,699.19 on Peace Support operations (i.e. N11,370,800,729.85 for UNAMID and N1,246,102,623.11 for Guinea Bissau) and DMO debt of N12,841,221,969.34.” The Nation
