When the Nigeria Ports Authority (NPA) terminated long-standing revenue collection contract between it and Integrated Logistics Limited Services (INTELS), it sent tongues wagging leading to the intervention of the House of Representatives. In this piece, JOSHUA EGBODO examines the issues.
In October 2017, the NPA announced the termination of its revenue collection contract with Integrated Logistics Limited Services (INTELS), a service providing firm reportedly owned by the former Vice President, Atiku Abubakar. The action was to generate a lot of mixed feelings among Nigerians, prompting a motion over which the House of Representatives passed a resolution to raise an Ad hoc panel to investigate the circumstances leading to the termination.
The boats pilotage monitoring and supervision agreement between the duo began to face issues, soon after the incumbent Managing Director of the NPA, Hadiza Bala-Usman, was appointed by President Muhammadu Buhari, as there influx of plethora of petitions against INTELS. Some industry followers saw some the petitions as genuine, while others considered them as coming from competitors who claimed INTELS was in some underhand collaborations with officials of the NPA and Federal Ministry of Transportation, to get them out of business.
Politics was also not spared, as fingers were pointed at some powerful forces within the ruling All Progressives Congress (APC), as masterminds of the termination, and that the new MD was only acting out the script she was brought in to execute. Many of the petitioners accused INTELS of monopolistic tendencies, and therefore called for holistic review of all existing contracts by the new management.
In what may have been a response to the numerous complaints against INTELS, the NPA subsequently launched an investigation into its contract with the company, and later came out with a verdict that there were infractions. Breach of the Treasury Single Account (TSA), which the current government opted to fully implement, was cited as the major issue against INTELS. The company was in February accused by the management NPA of withholding about $68.499 million belonging to the Authority.
INTELS, NPA seek solace from NASS
INTELS was to, however, approach the National Assembly to express its frustration, alleging that it was being owed $840 million, as its percentage due on the $1.29 billion revenue it had generated for the NPA, between January 2010 and September 30, 2016.
Specifically in its response to INTELS’ petition before the House of Representatives, the NPA, however, claimed that the jointly reconciled service boat revenue collected by INTELS for the period between 2010 and September 30, 2016 was $1.25 billion. In addition, it said the sum of $41.039 million being revenue for the period between October and December 2016 was at that time yet to be reconciled.
The Authority also noted that the total agency commission to INTELS computed in line with executed agreements was $353.066 million (N107.685 billion). This amount, it added, was deemed to have been deducted electronically from service boats revenue by the company in accordance with subsisting agreement, still credit notes were issued to regularise the deduction, among other issues.
But on February 21, 2018 when the constituted Ad hoc committee of the House of Representatives, under the leadership of its Deputy Whip, Hon. Pally Iraise, fixed an investigative public hearing with a view to listening to both parties, INTELS’ management was absent to the chagrin of the committee. The committee, which expressed anger over the attitude of the company, also refused to listen to any presentation of its legal representative, Mr. Kenneth Irabor.
Iriase, while expressing the disappointment of the committee, said the matter was presented in manner suggesting that INTELS was the victim, but cautioned that the penal will not any way condone any form short-changing against the Nigerian state. Members of Ad-hoc Committee probing the sudden termination of the contract were further stunned after listening to the MD of NPA, suggesting that the nation was short-changed of several million of dollars by INTELS.
The MD disclosed that the contract has, however, been reviewed with the caveat that the INTELS must have to comply with all conditions inherent in the TSA, as against the earlier practice of the company remitting what it deemed fit to the Authority. Adiza Bala-Usman explained that before she took over, INTELS remits what it deemed fit, a development that led to the termination of the contract.
“Having submitted for full compliance we have withdrawn the letter of termination. We have commenced collection of revenue for the November 2016 to November 2017. It was a one year indebtedness of $48 million dollars. This is for the period of November 2016 to November 2017”, she told the committee.
However, she warned that should there be any inexplicable drop in the revenue because of the new arrangement the NPA would not take it lightly.
While conceding that it was more efficient using the private sector-driven method to collect revenue as against direct government involvement, the MD expressed reservation on the formula of remittances in the former contract with INTELS.
“The NPA entered into agreement where INTELS have the upper hand, it has 28 percent of the revenue. The balance of the 78 percent there was not a balanced distribution. INTELS decide what it remits”, she said.
She said the review was necessitated more by the fact that “The agreement was actually silent on what it (INTELS) will pay. There was no clear timeline for payment. It was silent on that. There was never a sharing formula, INTELS decide what it gives to NPA”, she said and added when her management came on board that it was discontinued.
Committee shocked by revelations
The committee members appeared visibly piqued by these new revelations that suggested to them that the company may over time, been short-changing the country.
Chairman of the panel Iriase said: “Whatever we do will be for the interest of the nation. But if Intels think that we are going to handle them with kid gloves, they have other thing coming and from the look of things, they have been short-changing the nation. They cannot take us for granted”.
It has been the new twist to the entire saga. But will this be the end of the road for INTELS, in a battle it personally took to the National Assembly? The committee, which later adjourned its sitting infinitely, was yet to fix a date to give the company another chance of appearing before it. To followers of the matter, the waiting may be worth the while.