₦airaland Forum

The Petroleum Trust Fund, headed by former President, Gen. Buhari, has confounded all its critics. As a development agency, it has succeeded spectacularly where all others failed. Pini Jason has the details.

The one silver lining to emerge from the current heavy economic cloud must be the performance of the Petroleum (Special) Trust Fund (PTF). In October 1994, General Sani Abacha hiked the pump price of petrol from N3.25 to N11 per litre, promising, with Decree 25, to set up a Petroleum Trust Fund to distribute the gains from the increase on social and infrasturctural projects. The board of the fund, headed by former Head of State, Major-General Muhammadu Buhari, was eventually inaugurated on March 21, 1995.

The Fund began with an initial capital of about N60bn in 1996. Its all encompassing mandate includes the rehabilitation of roads and waterways, educational and health institutions, providing textbooks and stationary, procuring essential drugs and vaccines, providing water supply systems, reviving crumbling agricultural sectors, connecting outlying areas to the national electricity grid, extending railways and telecommunications and ensuring consistent food supply.

The huge budget and all-embracing mandate earned PTF some criticisms. Some dubbed it "the alternative government," accusing it of duplicating the responsibilities of other existing government agencies. There was for instance an initial conflict about who should be tarring which road, between PTF and the Federal Ministry of Works and Housing.

Yet, for once, other Nigerians began to hope that here was an agency that took its work seriously. The question was: could it carry out its entire mandate, or even a part of it? Everyone waited to see what would happen.

Initially PTF awarded contracts for the rehabilitation of 12,000km of federal highways (including drainages) nationwide, and between 25-100km of urban road in major cities such as Gusau, Benin, Funtua, Zaria, Enugu, Kaduna, Aba, Lagos, Lokoja, and Port Harcourt. A N27.3bn contract was awarded for road rehabilitation in the first quarter of 1996. The sum of N1.328bn was awarded to 53 pharmaceutical companies for the supply of drugs, while the importation of vaccines cost N229.9m. As at December 31, 1997, funds available to PTF stood at N115.1bn.

One thing even the most uncharitable critic of PTF will admit is that it has evolved a new way of doing things. This is true to its mission statement which is 'to establish and operate an open, modest and efficient organisation for the purpose of achieving the honest and timely execution of carefully designed socio-economic projects.'

Right from its inception, the Head of State directed the fund to operate a lean bureaucracy. It depends therefore largely on consultants supervised by Afri-Projects Consortium, the management consultant to PTF. This policy has created jobs and boosted the confidence of Nigerian professionals such as architects, engineers and quantity surveyors.

In many other ways, PTF has thrown a lifeline to dying sectors of the economy. Most of Nigeria's pharmaceutical companies were failing, and the foreign multinationals were divesting. But through its drugs procurement programme, PTF has turned the balance sheet of most of them into profit. Equipment and car leasing companies are also benefitting from the multiplier effects of PTF operations.

Banks and insurance companies have also benefited. Nigeria has a history of contractors collecting mobilisation (advance) fees and not carrying out the contract. But not with PTF. Every advance payment up to N10m must be guaranteed by a PTF-approved bank, while other advance payments are covered by performance bonds issued by similarly approved insurance companies. This method, apart from increasing solvency through cash deposits, has created business for banks and insurance companies.

One of the insurance companies that has benefited from PTF as a provider of performance bonds is The United Nigeria Insurance Company (UNIC), a composite insurance company which provides both life and non-life insurance. The total assets of UNIC stood at N979m while it grossed premium income of N916m and settled claims of N263m in 1996. With a staff of 552 spread all over its nationwide branch network, UNIC is today one of the leading insurance company in Nigeria.

Another company that has done good business with PTF is IPWA plc, formerly International Paints (West Africa) Ltd. IPWA is today one of the biggest and most diversified paint manufacturers in Nigeria. The company product range spans automotive paints, building paints, industrial coatings and marine coatings. Others are packaging coatings, protective coatings and wood finishes.

Most PTF contractors, specialist advisers and consultants lease and use computers, fax machines, printers and photocopiers. This has provided a new market for computer companies like Leading Edge Ltd., headed by Mr Tony Edoro, the managing director. Leading Edge is foremost in cloning computers with parts from diverse companies such as US Micro-Generation, IBM Direct, Merisel and Gateway. According to Mr Edoro, a widely experienced computer systems engineer, the advent of PTF has been good for Leading Edge. The company's turnover has grown from N50m in 1995 to well over N100m in 1997.

Apart from energising several sectors of the economy, PTF is also setting the pace in another direction. In the words of Mr Salihijo Ahmad, of Afri-Projects Consortium, the twin objectives of PTF are to "rehabilitate infrastructures and reorientate the people." This the fund does through its insistence on transparency even though some critics still accuse it of lopsidedness in project execution and selection of consultants and contractors.

In a country dogged by lack of transparency, PTF is the first, and perhaps the only public institution in Nigeria to publish its annual accounts. Last year, when he presented the annual report and accounts of 1996, Gen. Buhari promised to present the 1997 accounts before the end of the first quarter of 1998. He fulfilled that promise.

The 1997 account of PTF shows that it disbursed N24.3bn on roads, N21.2bn on security, N7.8bn on health, and N3bn on other projects. Other disbursements include N2.2bn on water supply, N936m on food supply and N476m on education. It realised a total of N1.049bn from various investment activities.

Reviewing the success story of PTF, Gen. Buhari said: "We have consolidated our execution of the take-off projects for the previous year and increased our intervention within the sectors. There is no doubt that the years ahead will witness even more intervention, as reports of some of the studies commissioned are received and project execution commenced."

The fund has embarked on community education to sensitise and enlighten communities of its activities. The idea is to bring recipients closer to the objectives of the fund, so that they can participate in project identification and selection as well as eventual PTF projects in their areas.

One aspect of the overall project that the public has raised an eyebrow over is the Armed Forces PTF. According to Gen. Buhari, PTF is under instruction to allocate 20% of its funds to the armed forces, and another 1% to the Federal Capital Territory. The allocation to the Armed Forces is probably a continuation of a practice that started during Gen. Babangida's time when he used to allocate excess revenue from the projected price of crude directly to the commanding officers. But what worries critics of PTF is that the military is not accountable to anyone regarding its utilisation of funds. Moreover, critics question the wisdom of allocating such a huge chunk to the military (who also usually takes the lion's share of the budget) over and above food supply, education and health. Apart from roads, the allocation to all other sectors does not add up to the Armed Forces PTF allocation.

Nobody knows how long PTF, a purely intensive intervention agency, will last or whether there will be a place for such an agency under a democratic set up. That decision, Gen. Buhari said, will be up to Nigerians. For now his preoccupation is to rehabilitate infrastructure and reorientate the people towards a new, effective and efficient way of executing uninflated contracts without kickbacks and without consuming mobilisation fees. Said Gen. Buhari to PTF contractors: "If you perform well, you get a hand shake. If you perform badly, you get a handcuff."

The Petroleum Trust Fund, headed by former President, Gen. Buhari, has confounded all its critics. As a development agency, it has succeeded spectacularly where all others failed. Pini Jason has the details.

The one silver lining to emerge from the current heavy economic cloud must be the performance of the Petroleum (Special) Trust Fund (PTF). In October 1994, General Sani Abacha hiked the pump price of petrol from N3.25 to N11 per litre, promising, with Decree 25, to set up a Petroleum Trust Fund to distribute the gains from the increase on social and infrasturctural projects. The board of the fund, headed by former Head of State, Major-General Muhammadu Buhari, was eventually inaugurated on March 21, 1995.

The Fund began with an initial capital of about N60bn in 1996. Its all encompassing mandate includes the rehabilitation of roads and waterways, educational and health institutions, providing textbooks and stationary, procuring essential drugs and vaccines, providing water supply systems, reviving crumbling agricultural sectors, connecting outlying areas to the national electricity grid, extending railways and telecommunications and ensuring consistent food supply.

The huge budget and all-embracing mandate earned PTF some criticisms. Some dubbed it "the alternative government," accusing it of duplicating the responsibilities of other existing government agencies. There was for instance an initial conflict about who should be tarring which road, between PTF and the Federal Ministry of Works and Housing.

Yet, for once, other Nigerians began to hope that here was an agency that took its work seriously. The question was: could it carry out its entire mandate, or even a part of it? Everyone waited to see what would happen.

Initially PTF awarded contracts for the rehabilitation of 12,000km of federal highways (including drainages) nationwide, and between 25-100km of urban road in major cities such as Gusau, Benin, Funtua, Zaria, Enugu, Kaduna, Aba, Lagos, Lokoja, and Port Harcourt. A N27.3bn contract was awarded for road rehabilitation in the first quarter of 1996. The sum of N1.328bn was awarded to 53 pharmaceutical companies for the supply of drugs, while the importation of vaccines cost N229.9m. As at December 31, 1997, funds available to PTF stood at N115.1bn.

One thing even the most uncharitable critic of PTF will admit is that it has evolved a new way of doing things. This is true to its mission statement which is 'to establish and operate an open, modest and efficient organisation for the purpose of achieving the honest and timely execution of carefully designed socio-economic projects.'

Right from its inception, the Head of State directed the fund to operate a lean bureaucracy. It depends therefore largely on consultants supervised by Afri-Projects Consortium, the management consultant to PTF. This policy has created jobs and boosted the confidence of Nigerian professionals such as architects, engineers and quantity surveyors.

In many other ways, PTF has thrown a lifeline to dying sectors of the economy. Most of Nigeria's pharmaceutical companies were failing, and the foreign multinationals were divesting. But through its drugs procurement programme, PTF has turned the balance sheet of most of them into profit. Equipment and car leasing companies are also benefitting from the multiplier effects of PTF operations.

Banks and insurance companies have also benefited. Nigeria has a history of contractors collecting mobilisation (advance) fees and not carrying out the contract. But not with PTF. Every advance payment up to N10m must be guaranteed by a PTF-approved bank, while other advance payments are covered by performance bonds issued by similarly approved insurance companies. This method, apart from increasing solvency through cash deposits, has created business for banks and insurance companies.

One of the insurance companies that has benefited from PTF as a provider of performance bonds is The United Nigeria Insurance Company (UNIC), a composite insurance company which provides both life and non-life insurance. The total assets of UNIC stood at N979m while it grossed premium income of N916m and settled claims of N263m in 1996. With a staff of 552 spread all over its nationwide branch network, UNIC is today one of the leading insurance company in Nigeria.

Another company that has done good business with PTF is IPWA plc, formerly International Paints (West Africa) Ltd. IPWA is today one of the biggest and most diversified paint manufacturers in Nigeria. The company product range spans automotive paints, building paints, industrial coatings and marine coatings. Others are packaging coatings, protective coatings and wood finishes.

Most PTF contractors, specialist advisers and consultants lease and use computers, fax machines, printers and photocopiers. This has provided a new market for computer companies like Leading Edge Ltd., headed by Mr Tony Edoro, the managing director. Leading Edge is foremost in cloning computers with parts from diverse companies such as US Micro-Generation, IBM Direct, Merisel and Gateway. According to Mr Edoro, a widely experienced computer systems engineer, the advent of PTF has been good for Leading Edge. The company's turnover has grown from N50m in 1995 to well over N100m in 1997.

Apart from energising several sectors of the economy, PTF is also setting the pace in another direction. In the words of Mr Salihijo Ahmad, of Afri-Projects Consortium, the twin objectives of PTF are to "rehabilitate infrastructures and reorientate the people." This the fund does through its insistence on transparency even though some critics still accuse it of lopsidedness in project execution and selection of consultants and contractors.

In a country dogged by lack of transparency, PTF is the first, and perhaps the only public institution in Nigeria to publish its annual accounts. Last year, when he presented the annual report and accounts of 1996, Gen. Buhari promised to present the 1997 accounts before the end of the first quarter of 1998. He fulfilled that promise.

The 1997 account of PTF shows that it disbursed N24.3bn on roads, N21.2bn on security, N7.8bn on health, and N3bn on other projects. Other disbursements include N2.2bn on water supply, N936m on food supply and N476m on education. It realised a total of N1.049bn from various investment activities.

Reviewing the success story of PTF, Gen. Buhari said: "We have consolidated our execution of the take-off projects for the previous year and increased our intervention within the sectors. There is no doubt that the years ahead will witness even more intervention, as reports of some of the studies commissioned are received and project execution commenced."

The fund has embarked on community education to sensitise and enlighten communities of its activities. The idea is to bring recipients closer to the objectives of the fund, so that they can participate in project identification and selection as well as eventual PTF projects in their areas.

One aspect of the overall project that the public has raised an eyebrow over is the Armed Forces PTF. According to Gen. Buhari, PTF is under instruction to allocate 20% of its funds to the armed forces, and another 1% to the Federal Capital Territory. The allocation to the Armed Forces is probably a continuation of a practice that started during Gen. Babangida's time when he used to allocate excess revenue from the projected price of crude directly to the commanding officers. But what worries critics of PTF is that the military is not accountable to anyone regarding its utilisation of funds. Moreover, critics question the wisdom of allocating such a huge chunk to the military (who also usually takes the lion's share of the budget) over and above food supply, education and health. Apart from roads, the allocation to all other sectors does not add up to the Armed Forces PTF allocation.

Nobody knows how long PTF, a purely intensive intervention agency, will last or whether there will be a place for such an agency under a democratic set up. That decision, Gen. Buhari said, will be up to Nigerians. For now his preoccupation is to rehabilitate infrastructure and reorientate the people towards a new, effective and efficient way of executing uninflated contracts without kickbacks and without consuming mobilisation fees. Said Gen. Buhari to PTF contractors: "If you perform well, you get a hand shake. If you perform badly, you get a handcuff."

ITS UNFORTUNATE DAT SOME PPLE CAN STILL CAMPAIGN 4 A PARTY LIKE THEPDP

can't av a 'rubber stamp' GOOD LUCK as my president, lets vote wisely, VOTE BB 4 CREDIBLE LEADERSHIP

9ja, dis might b our last oportunity 2 change dis country 4 good.VOTE WISELY, VOTE B/B

Nigeria on d march again looking 4 mr. president, B/B is our choice

Nigeria on d march again look 4 mr. president, B/B is our choice

one of d reasons y we must VOTE OUT PDP this april

BB revolution is moving, dont b left out

Stability is the only hallmark of the PDP 12 years at the federal level. But stability at what cost? To the masses, stability means stagnation, as the economy prospered so the number of people living in poverty increased. It may interest you to know that despite our huge resources, in the 12 years of PDP rule more than 70% of our over 140million people live on $1 (N150) daily, the richest black nation does not have a functional refinery, a major oil producing nation imports petroleum products from non oil producing nations, our international airports have never been upgraded not to talk of building new ones, our hospitals are worse than veterinary hospitals in less wealthy countries, our educational system produces educated illiterates, while South Africa gave a contract for 5,000MW at just $3b for electricity, PDP spent over $17b in 11years on power to generate less than 2,000MW yet we do not have electricity.

The future continues to look bleak but we can use our votes, our phones, our bb, our twitter, our facebook, our email to effect the type of change that the youths in Egypt effected in 18 days. Remember, the youths of Egypt made sacrifice, they were resolute, they abandoned ethnic differences, they influenced and mobilized their parents and their friends because they wanted to salvage their future. The future does not belong to the parents, it belongs to the youths.

The objective is simple, to have a clean break from the past, issue PDP a red card and restore hope for the future. The task is simpler, send this to a minimum of 10 contacts on your phone, email, twitter of facebook who are young, young at heart and desire a brighter rewarding future.WA
Our destiny is our hands !!

Stability is the only hallmark of the PDP 12 years at the federal level. But stability at what cost? To the masses, stability means stagnation, as the economy prospered so the number of people living in poverty increased. It may interest you to know that despite our huge resources, in the 12 years of PDP rule more than 70% of our over 140million people live on $1 (N150) daily, the richest black nation does not have a functional refinery, a major oil producing nation imports petroleum products from non oil producing nations, our international airports have never been upgraded not to talk of building new ones, our hospitals are worse than veterinary hospitals in less wealthy countries, our educational system produces educated illiterates, while South Africa gave a contract for 5,000MW at just $3b for electricity, PDP spent over $17b in 11years on power to generate less than 2,000MW yet we do not have electricity.

The future continues to look bleak but we can use our votes, our phones, our bb, our twitter, our facebook, our email to effect the type of change that the youths in Egypt effected in 18 days. Remember, the youths of Egypt made sacrifice, they were resolute, they abandoned ethnic differences, they influenced and mobilized their parents and their friends because they wanted to salvage their future. The future does not belong to the parents, it belongs to the youths.

The objective is simple, to have a clean break from the past, issue PDP a red card and restore hope for the future. The task is simpler, send this to a minimum of 10 contacts on your phone, email, twitter of facebook who are young, young at heart and desire a brighter rewarding future.
Our destiny is our hands !!

Stability is the only hallmark of the PDP 12 years at the federal level. But stability at what cost? To the masses, stability means stagnation, as the economy prospered so the number of people living in poverty increased. It may interest you to know that despite our huge resources, in the 12 years of PDP rule more than 70% of our over 140million people live on $1 (N150) daily, the richest black nation does not have a functional refinery, a major oil producing nation imports petroleum products from non oil producing nations, our international airports have never been upgraded not to talk of building new ones, our hospitals are worse than veterinary hospitals in less wealthy countries, our educational system produces educated illiterates, while South Africa gave a contract for 5,000MW at just $3b for electricity, PDP spent over $17b in 11years on power to generate less than 2,000MW yet we do not have electricity.

The future continues to look bleak but we can use our votes, our phones, our bb, our twitter, our facebook, our email to effect the type of change that the youths in Egypt effected in 18 days. Remember, the youths of Egypt made sacrifice, they were resolute, they abandoned ethnic differences, they influenced and mobilized their parents and their friends because they wanted to salvage their future. The future does not belong to the parents, it belongs to the youths.

The objective is simple, to have a clean break from the past, issue PDP a red card and restore hope for the future. The task is simpler, send this to a minimum of 10 contacts on your phone, email, twitter of facebook who are young, young at heart and desire a brighter rewarding future.
Our destiny is our hands !!

aganga obviously cannot stand soludo

FAMILY BANK
FATHER CHAIRMAN.
SON MD

any body who buys into dos bank do so @ his own risk.CBN cannot sell wat e does not own.

shows 4 asawo and lesbians

even abacha get award wen e dey alive

GT my foot!! some of d so called rescue banks r perfoming beta now interms of C. SEVICE.Sanusi is only bent on killin some banks 2 suit his FIRSTBANK

nonsence!! sanusi should stop intimidating banks unnecessary.his actions r truly overbearin on d banks

@ ayoos: d way forward caution sanusi his reform is pushin d youth out of job

sanusi's appointed managers of dis banks r out 2 wreck d banks. from PHB 2 FINBANK,OCEANIC ,SPRING D stories r d same.i'm suprise all "perfect "sanusi is turning deaf ears 2 all dis allegations.

2 me sanusi is 2 tempremental 4 d office he holds

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hear d man we call our CBN GOV.

atleast 9ja can export somethin, CORRUPTION

poor MUNYA he really played d game

dis is d consequence of foreign take over of banks which sanusi has been championing,nigerians will now c d reason y some of us is oppose 2 d move

@ igbeme
e b like say na 4 refugee camp dem born u.i no get time 2 waste wit u again

@kitaun

tank u prof. of english

@bankyland:thank u, unfortunalety most nigerians r ignorance of sanusi schemes.all d bank chief r guilty of d same charges including d sanusi wen e was in first bank.today is CECELIA definately sanusi's own book will b open somday.

@ orangeman.iam sure u know ibeme started insulting me on dis thread.i also want 2 consider ur first statement rather insultive aswell.we all can not av d same view on issues and we shuld learn 2 accomodate others opinion.