The Federal Government is indebted to 3,504 contractors to the tune of N69.9 billion for various housing projects executed across the country, Minister of Works and Housing, Babatunde Fashola, has said.
Fashola states this on Thursday in Abuja, when he appeared before the National Assembly joint committee on Housing to defend his ministry’s 2021 budget estimates.
He said the sum of N76.4 billion is proposed as capital allocation for the housing sector in the 2021 budget.
He said: “When you look at our 2021 budget, we are almost on a very tight fix because if we have liabilities of N69.9billion, how far will a budget of N76.4 billion then take us.
“However, let me point out that budget of N76.4 billion was based on the envelope prescription from the Ministry of Finance, Budget and National Planning and also the financial realities at the time the budget occurred and also the price of oil.”
He, however, said the ministry has completed a total of 1,786 National Housing projects across the country out of the 3,926 projects initiated by the Federal Government.
He noted that the 2021 budget would be anchored on the completion of the remaining 2,140 housing units under the national housing programme in 34 states of the federation and the FCT.
Fashola also said six Federal Secretariats were under construction in Bayelsa, Anambra, Ekiti, Osun, Zamfara and Nasarawa states.
He told the lawmakers that there was need to complete all ongoing projects before embarking on new ones.
He added that the major factors mitigating against the timely completion of projects was insufficient budgetary provision for projects to sustain annual cash-flow requirement levels.
“Let’s behave like the very smart people that we are and so instead of starting a new one next year, let’s use next year’s appropriation to finish this so that we can pay those small contractors and there will not be default in the system. That is why we are here. But if we choose to say no, it is Ministry of Works problem, it is not Ministry of Works problem. It is Nigeria’s problem,” he said.
Some members of the committee expressed concern on the huge amount of outstanding liabilities due to contractors in the housing sector.
The Chairman, Senate Committee on Housing, Senator Sam Egwu (Ebonyi North), said money should be appropriated specifically for completing such projects.
