By Michael Agbaji
Various stakeholders in the public hearing at the house of representative in the bill to seek privatization and concession of more government assets has cautious the national assembly to always see the benefits such policy to Nigeria rather than enrich the few.
The Minister of works and housing Mr Babatunde Fashola asks
The objective of the past privatization policy of the government.
According to him, government has privatization over
234 enterprises so far in the past.
Nigerian Labour Congress, NLC and the Bureau for Public Enterprise, BPE have asked the National Assembly to be cautious in enacting law that will not benefits ordinary people as such exercise in the past have not been realized.
On his part, Speaker of the House Femi Gbajabiamila represented by the leader of the house Hon. Ado Dogowa underscored the need for a legal framework for the privatisation and concession of government assets.
public hearing of a bill titled ‘A Bill for an Act to Repeal the Public Enterprises Privatization and Commercialization 1999 Act Cap P38 LFN 2004 And Enact the Public Assets Reform Bill 2021 For Improved Efficiency and Management of Public Assets in Nigeria and For Related Matters’
The President of Nigeria labour Congress NLC Comrade Ayuba Wabba highlight the effect of privatisation which includes has loss of jobs.
According to him,terminal benefits of the workers have not been paid. I have thousands of the power sector workers whose benefits have not been paid.
He says,investors are coming from other climes to invest in our power sector. What happened is that they went to the banks where we saved our money, withdrew the money and bought those assets and added no value. We don’t support the idea that privatisation is the only way and we will not support it. We agreed that there are things we can do.
“They will not privatise moribund assets, they look at the viable ones. The issue of NITEL, what they did was assets striping, including the Power holding. The assets were first stripped and sold and no value has been added. Check the steel rolling mills which were privatised. The first thing they did was shut down the place and sell off the assets. I don’t think we should continue in this light. We must be able to say no If it has not worked, why are we the poverty capital of the world he asked?
“Mr President is against the privatisation of some key facilities. When some of those policy documents were smuggled in and we raised on the issue, he said no, he said he was not going to privatised health and education because it is a legacy he wants to leave for the children of the poor.
So let us do the right thing. He asked have We not privatised power and yet I still buy our transformer and no value has been added”.
He recalled that Nigerians were also exploited during the coming of GSM in Nigeria.
He said: “When this concept of having privatisation as the only way to enhance our economic development came up,we have always said that is not correct. From the beginning,we have engaged governments from Obasanjo to the current government.
According to him why is Obasanjo said NLC should be a member of the Council but for obvious reasons,NLC was alleniated.
He says President Buhari also insisted that NLC should be part of the Council but NLC was substituted“If by now, we have privatised 234 Enterprise in Nigeria and we say that it is aimed at creating wealth and address the issue of poverty yet we are the poverty capital of the world, then something is wrong with that policy.
He says the idea of GSM was privatised is wrong. Let us correct the narrative there was a GSM revolution around the world and we keyed into it by killing NITEl but other part of the world like Britain you still make calls using landline but in we were exploited in Nigeria When GSM came into the country, if you compare with other countries, we were exploited. That was not a process of privatisation. It was a process of allowing people come and invest in our economy.
In his part, the Director-General, BPE, Alex Okoh said caution should be exercised.
“He said: “Our point of agreement is that not all public infrastructure and assets need to be privatised but those that need to be privatised or concessioned need to be guided by clear and robust piece of legislation.
“We are in a precarious situation. The country has only recently emerged from recession following the destructive impact of COVID-19 pandemic. However, the resultant constraints in the fiscal space are still very much evident. Our debt stock is rising while our revenue is declining. This trend becomes more worrisome when considered against certain key economic indicies.
According to him,debt to GDP ratio is average 34 percent which is higher than the international threshold of 30 percent. Debt service to revenue ration is 98 percent which is above the world bank threshold of 22.5 percent. Debt to revenue ratio is estimated to be at 538 percent at the end of the second quarter of this year which has also exceeded the international threshold of about 250 percent.
Further more, withstanding this gloomy reality, there is still the possibility of emerging from this dark tunnel and into the light of economic prosperity by seeking to out in place a credible and robust mechanism to reset and reform the economy especially a robust asset optimisation and public, private partnership framework to attract private capital into infrastructure development, thereby stimulating economic growth.
“At the inception of civilian administration in 1999, the Bureau of Public Enterprises was created through an act of the National Assembly.
“From inception to date, a total of 234 public Enterprises have been successfully reformed by way of privatisation, commercialisation and in some cases, concessioned. It may interest us to know that the globally acclaimed telecom revolution in Nigeria which has created a teledensity of about 96 percent in 20 years with a current contribution of 14 percent to the National GDP is a product of the reform of the sector. Other reforms include privatisation of federal government interest in previously state owned banks and insurance companies which has led to the growth in the capacity of the banks as evidenced by the strong balance sheet and expansion into the continental and global markets as well as product and service innovation and efficiency of the financial institutions leveraging on technology.”
“I am not against private sector investment or participation in national development; I am not against it. So, let me make my position very clear. But it saves that a conversation has persisted, suggesting that every time we have a developmental problem, the silver bullet is given to the private sector – PPP. I think that it is a conversation that has been heard in very general terms and it needs to be interrogated in a very granular form – some detail. I just wish to point this honourable committee in that direction.
“The first thing I want to first ask is that, of all the assets that we have disposed and the reasons for disposing them or for commercialising them or for privatising them, have we achieved the objective that we set out to achieve? I think we should ask that question. And I think apart from making this law, that undertaking would be a profound service to Nigeria, so that all of us will have a very clear understanding of the capacity, ability and what is realistic to expect of the private sector.
“I think if we do that and interrogate very honestly, some of the things that would begin to become obvious to us is that we need to be more circumspect about certain types of assets. This is an important point: There are certain types of assets that the private sector is just unable to deal with. For example, when you look at roads, not many people who claim to want to do it have the capacity or the experience to do it”, he said.
The Chairman of the House Committee on Privatization and Commercialization of government assets, Hon. Ibrahim Misau said the House needed to be guided in repealing the Privatization and Commercialization Act of 1999
