INVESTIGATION: COVID-19 Response Projects Worth ₦534.98 Million Awarded to Unverified Contractors

• According to the Dataphyte investigation, COVID-19 emergency procurements worth ₦451.18 million have been awarded to unverifiable contractors or suppliers.

• Some of the companies do not have records on the database of the Corporate Affairs Commission (CAC) and the Contractors’ list of the Bureau of Public Procurement.

• Although BPP Guidelines cater for Emergency Procurement, some MDAs hid under the COVID-19 emergency exemptions to award contracts to unverified contractors, ignoring due process.

• BPP, Stakeholders frown at sharp procurement processes, call for strict punishment

COVID-19 emergency procurements worth ₦534.98 million have been awarded to unverifiable contractors or suppliers, a Dataphyte investigation has shown. A total of 71 projects valued at ₦1.99 billion (₦1,992,650,974.59) were awarded to more than fifty contractors for the supply of different goods and services. This is according to the document published on the website of the Bureau of Public Procurement (BPP).

The initial search of two key public databases raised red flags. First, about nineteen (19) contractors who have been awarded separate projects to the tune ₦451.18 million (₦451,177,922.00) have no records on the BPP’s Federal Contractors database. Another five contractors are non-compliant to the full requirement of the BPP. The amount is worth ₦83.80 million.

The data mined from the Nigeria Open Contracting Portal (NOCOPO) of the Bureau Of Public Procurement (BPP) showed these contracts were awarded by five MDAs – Ministry of Environment, Nigeria Centre For Disease Control (NCDC), Nigeria Security and Civil Defence Corps (NSCDC), Obafemi Awolowo University Teaching Hospital (OAUTH), and the National Primary Health Care Development Agency (NPHCDA).

In April 2020, the Federal Government raised ₦697.54 million donations from individuals, companies, and organisations. The donation aims at eradicating the COVID-19 pandemic in the country. The data, published on the Open Treasury Portal of the Office of Accountant-General of the Federation, contains daily donations from April 7th to April 30th, 2020 without record for spending.

For every kobo spent by the Federal Government or its MDAs, it has a significant impact on the livelihood of an ordinary Nigeria. COVID-19 emergency procurement is such a significant fund that every MDA must be held accountable. 

Big Suppliers by Contract Sum

Breakdown of the figures showed that the Ministry of Environment spent ₦489.14 million, National Primary Health Care Development Agency (NPHCDA) spent ₦587.22 million. The Nigeria Centre For Disease Control (NCDC) spent ₦663.58 million, Obafemi Awolowo University Teaching Hospital (OAUTH) spent ₦2.72 million, and Nigeria Security and Civil Defence Corps (NSCDC) spent ₦250 million. This covers their COVID-19 expenses up to June 25, 2020, when the data was mined.

Further analysis of the data reveals that Messrs Masfas International Limited received the highest payment for the supply of one Chlorines Based Chemicals and Outdoor Application (Lagos Centre). The contract costs the Federal Government ₦98 million. Messr Design Three Sixty Limited came second on the list for the same supply (Abuja Centre) at ₦97.6 million.

The Federal Ministry Of Environment Headquarters also spent ₦53.9 million and ₦49.8 million as Consultancy Services on Capacity Development of Environmental Health Emergency Response Management and one Personal Protective Equipment (PPE), respectively. Messrs Joki Engineering Consultants Limited and Messrs Westfield Global Construction Limited were the contractors. Others include Uni-Medical Health Care Limited, Kaura Motors Nig. Limited, Future Concerns Limited, and G&T Motors Nig. Limited with contracts above ₦49 million each.Some of the Red Flags in COVID19-Response Contracts by MDAs

Aside from the concerns about the legal and compliance status of the contractors, the inflated sum of procurement items also marred the COVID-19 spending by these agencies of the Federal Government. Dataphyte also checked some questionable line items in the procurement processes. These items raised issues such as transparency, accountability, lack of purpose and priorities in the fight against COVID-19. The major aim of the emergency fund is to tackle the coronavirus pandemic and prevent its spread in the country.

Some of the contracts include:

• ₦38 million for IEC materials (Posters) – A3 Poster (233400 one), A4 Poster (233400 one), Laminated A4 Poster for town announcers (191000 one).
• ₦1 million for COVID-19 ID Card/Pass – (Local Purchase Order (LPO) for the production of 500 Units of NCDC COVID-19 Identity Cards/Pass. Awarded By NCDC
• ₦18 million for procurement of Liquid Soap (LIQUID SOAP (10000 millilitres per kilogram)) – Awarded by NSCDC
• ₦40 million for procurement of customised fabric face mask (CUSTOMISED FABRIC FACE MASK (10000 one), CUSTOMISED FABRIC FACE MASK (10000 Carton)) – Awarded by NSCDC
• ₦48 million for the procurement of Hand sanitiser (HAND SANITIZERS(500ML BOTTLE) (10000 millilitres per kilogram) – Awarded by NSCDC
• ₦29.7 million for 3,500 litres of ANTISEPTIC awarded by NCDC.

BPP Guidelines for Emergency Procurement

The Emergency Procurements Guidelines published by the Bureau of Public Procurement relaxed certain procedures in order to accommodate procurements under emergency situations like the COVID-19 pandemic. This is in accordance with Section 43 of the Public Procurement Act, 2007. 

For instance, the usual Due Process Certificate of “No Objection” is not required before MDAs embark on an emergency procurement. Rather, in an emergency situation, “the procuring entity is expected to proceed immediately to engage in direct contracting to expeditiously address the situation but this must be done along with the principles of accountability, due consideration being given to the gravity of each emergency. 

Although the procedures have been relaxed, the guideline stipulates that Procuring Entities have the responsibility to ensure that any contractor to be engaged to carry out any emergency work is eligible to do business with the Government and possesses the requisite technical and financial capacities to undertake the project. In addition, Procuring Entities are to ensure that the procurement is handled with expedition but along the principles of accountability, transparency, and value for money.

But investigations by Dataphyte show that some of the procurements were done without due diligence and principle of transparency. The MDAs also hid under the COVID-19 emergency exemptions by smuggling in unverified contractors, ignoring requisite technical and financial capacities of the contractors.

Contractors Not Approved To Engage In FG Contracting Process

As at the time of filing this report, checks by Dataphyte also showed that some of the companies do not have records on the database of the Bureau of Public Procurement. For instance, Messrs Alhaji Bello Maikusa & Sons Limited did not comply with the BPP Act. The building contractor was awarded a ₦46.5 million contract for the supply of Non-Contact Thermometer Gun (372 one) for the Nigeria Security and Civil Defence Corps. 

Also, Messrs Bluzav Global Enterprises Limited received ₦21.54 million for the procurement of 30,000 Vials of 200MG/20ML of injection Ribavirin. Both contracts have been completed.

Other findings revealed Future Concerns Limited. The company has no record on the Bureau of Public Procurement database The company was awarded a ₦49.8 million contract by the Nigeria Centre for Disease Control Abuja to supply Personal Protective Equipment. 

The projects awarded to non-compliant contractors

By implication, this may breed corruption and question accountability on the part of MDAs in handling life-saving procurements during the COVID-19 pandemic. Some of the contractors were also awarded the contract because some of the items were traceable. Examples include procurement on hand sanitizers or face masks.

Officials at MDAs Dodge Procurement Questions

Several emails sent to the Ministry of Environment, Nigeria Security and Civil Defence Corps were not attended to. Email enquiries sent to the Nigeria Centre For Disease Control were not replied. When contacted, Emeka Oguanuo, spokesperson of the NCDC, promised that his team will follow up and get back.  He later asked the reporter to visit the Procurement Unit of the NCDC in Abuja for further details. 

On two occasions, this reporter did not meet the Procurement Head, NCDC Abuja, on the seat. When confronted to defend the procurement exercise by his department, a Procurement Officer at NCDC Abuja, who was not authorised to speak on the matter, said the non-compliance contractors were not for COVID-19 procurements. 

“These companies were contracted for other purposes outside COVID-19 emergency procurements,” he said.  

When the reporter queried him about a contract, “Fumigation services at Deratisation of Central Public Health Laboratory, Yaba, Lagos,” awarded to Alani Anlamole and Sons Com. (Nig) Ent. for ₦1 million, he quickly noted that there were some errors in the compilation sent to BPP. 

Explaining further, he said, “Those procurements occurred because COVID-19 is an emergency, and we had to turn to people that already had some items in their store to supply.”

He said the NCDC had informed some of the non-compliant companies that they will not receive balance until they fully complied with the BPP Act. But according to the NOCOPO and files submitted to the BPP, the NCDC did not state any outstanding payment.

The National Primary Health Care Development Agency (NPHCDA) did not reply to email and texts sent to its official line. 

The Obafemi Awolowo University Teaching Hospital (OAUTH) directed the reporter to the Bureau Of Public Procurement for further details about the contractors they awarded COVID-19 related contracts. The letter signed by the Director of Procurement, Mrs M.I. Olorounbi on behalf of the Chief Medical Director (CMD) only listed the Company Registration Number and BPP Number of the two questionable contractors with no further details.

“Kindly contact the Bureau of Public Procurement (BPP) for any further clarification you might need about the two contractors,” Mrs. Olorounbi said.

MDAs  Must Award Contracts to Compliant- Contractors In Accordance With The Law – BPP

According to the Bureau of Public Procurement guidelines on COVID-19 pandemic, MDAs are to send in completed projects, details of contractors, pricing, and accompanying images for the completed project. This is where the BPP comes in for verification.

Mansur Mamman, a Specialist at the Bureau of Public Procurement, said all contractors awarded COVID-19 related procurement must fulfill all obligations according to the BPP Act. “Even if it’s an emergency, they are expected to get contractors to run the projects and ensure the price is in order. Write to BPP with full documentation, including pictures, and they have to ensure contractors have fulfilled all obligations.

“Contractors must have full verification and accreditation by BPP. They must have complied with Pension, FIRS, Nigeria Social Insurance Trust Fund, Industrial Training Fund (ITF) requirements.

“MDAs can not say they cannot get contractors that have fulfilled all necessary documentations with BPP. You can easily verify on our portal before even issuing or awarding contracts. That is why they are professionals. Even in an emergency, you can get contractors within your locality on our portal in a minute. They are verified and available across cities.”

Sanction Mechanism To Erring MDAs, Contractors Weak

An official at the office of Auditor-General of Federation (OAuGF) says the lack of strict mechanism and bureaucratic process continue to weaken the sanction process in procurement procedures. The official who asked not to be named told Dataphyte that the OAuGF can only audit MDA accounts and refer the audit findings to the National Assembly. 

“From there, the parliament can investigate or mandate an anti-corruption agency to initiate action against erring MDAs, contractors, or suppliers. “Independently, Independent Corrupt Practices Commission (ICPC) can also take up audit findings and prosecute defaulting agencies.”

Stakeholders Call for Proper Audit, Strict Punishment For MDAs Violating Procurement Laws

Segun Elemo, Executive Director of Paradigm Leadership Support Initiative (PLSI), called for a real-time audit of the public fundings during COVID-19. “The emergency allows relaxation of some strict procurement procedures, but while they make emergency procurement, MDAs are to ensure the economic efficiency and accountability of public funds.

“MDAs have institutional ways of getting around this thing. They have been grounded in sharp practices, and this is time for them to capitalise on the loopholes.”

He urged the Nigerian government to learn from Sierra Leone on real-time audits of public funds and not raise red flags after a year or two.

“The Auditor-General must ensure there is an ongoing audit of all emergency spendings. The ICPC should also step in. They should not wait for a year to start auditing, they must do a real-time audit of every expenditure, particularly COVID-19-related responses.

“We must ensure we get value for every kobo expended on the COVID-19 procurement so they can flag irregularities immediately. COVID-19 spending is a matter of life and death, and every kobo must be accounted for,” Elemo added.

Kachi Chukwu, Program Manager at Public and Private Development Centre (PPDC), explains that the whole procurement process is faulty itself. He frowns at how MDAs will release spending without stating the exact amount and figure of specific items. 

“They are to follow a standard procurement rule by stating the amount each unit costs. That will give the actual amount of what they have purchased. If they did not do this, then the whole process of submitting COVID-19 expenses is faulty.” 

He urged MDAs to follow strict open contracting standards as a means for transparency and accountability in the public sector.

Ijeoma Okereke – Program Executive for PTCIJ says a proper breakdown of procurement items brings about efficiency and accountability in the public sector. For MDAs to follow the path of transparency, she said they must provide adequate information on whatever procurements they have made.

“We understand the moment of disaster comes with intense pressure for the government, but they should not let it be lawlessness. “It can lead to bribery and corruption and a monopoly in nature. Contractors who have not met the laws of BPP would want to manipulate their ways because of the Emergency Procurement guidelines. 

“In the end, we get less value for the money paid for. How can you award ₦48 million for the procurement of Hand Sanitiser? Some local people can do those kinds of jobs,” Okereke quizzed

She advised CSOs to collaborate and track public spendings during COVID-19 pandemic and continue to lead the voice against corrupt practices at government agencies.

The Nigeria Open Contracting Portal (NOCOPO) is updating the COVID-19 emergency procurement regularly in line with regulations. The story captured the data up to midday, June 29, 2020.