There was a mild drama on Tuesday when a Senate panel turned down the memorandum of the Ministry of Steel Development on Ajaokuta Steel Company it described as “watery.”
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The investigative public hearing was organised by the Senate Ad-hoc Committee on the “alleged incidences of corruption and inefficiency in Ajaokuta Steel Company Limited (ASCOL) and National Iron Ore Mining Company (NIOMCO) and the general state of affairs in the Federal Government owned companies from 2002 till date”.
The Minister of Steel Development, Mustapha Audu Abubakar, represented by the Permanent Secretary, Dr. Chris Osaruwanmwen, made the presentation to the committee was was described as “watery” and later stood down.
Chairman of the Ad-hoc committee, Senator Adeniyi Ayodele Adegbonmire (SAN) wondered how Ajaokuta will ever work when the Ministry of Steel, which directly supervises Ajaokuta presented only “a 2-page watery memorandum” to the Senate committee saddled with the enormous job.
“How can Ajaokuta work? You have not presented something that will make Ajaokuta work. Tell us the problem and the steps you have taken to make Ajaokuta work. What you presented shows the ministry is not on top of the situation,” he said.
The Upper Chamber was also told that the privatisation and concession of the company was not in the best interest of the country.
The concession agreement between the Federal Government and GINL provided for GINL to import capital into the company but didn’t bring a dime.
To make matters worse, Nigeria was said to have paid $496 million to Global Infrastructure Nigeria Limited (GINL), the company Ajaokuta was concessioned to as out-of-court settlement.
This infuriated the Senate investigative panel when it was clear that GINL did not bring in a dime as investment.
The Central Bank of Nigeria (CBN) represented by Hamisu Abdullahi, Director Banking Services presented evidence of payment of $496 million to GINL with a mandate from office of the Accountant General of the Federation.
He said the source of the money was FGN independent revenue account from where$250 million in settlement agreement was paid in September 2022 and the balance paid from FGN Bonus Account in instalments $49.32 million.
Abdullahi confirmed that there was no capital importation by GINL.
The Sole Administrator of Ajaokuta, Engr. Sumaila Abdul Akaba, who described ASCOL as a strategic company, said the state of the plant is still intact.
Akaba told the committee that the line plant, which has been completed and will be ready in 6 months can meet the lime need of the 36 states.
The Sole Administrator debunked the belief in many quarters that ASCOL is obsolete by saying that all the steel companies in India and China are built by this Russian technology like Ajaokuta.
Akaba also justified to retention of staff of the steel company and the N4.2 billion in the 2024 budget for salaries which Senator Natasha Akpoti-Uduaghan (Kogi Central) criticised.
He said those staff who are maintaining the plant are the only reason we still have what we call Ajaokuta today, adding that if you buy a brand new car and park it outside for a year without care, you won’t be able to drive it when you need it.
Stakeholders at the investigative hearing included Federal Ministry of Finance, Nigeria Society of Engineers, Steel and Engineering Workers Union of Nigeria, Bureau of Public Enterprises, etc.
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