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We don’t hijack projects – ICRC boss

As you know, in the last ten years, one of the key impediments to sustained economic growth of Nigeria is the fact that most of…

As you know, in the last ten years, one of the key impediments to sustained economic growth of Nigeria is the fact that most of our infrastructural facilities have deteriorated. Electricity has degenerated at some point from 6,000 Megawatts to below 2,000 Megawatts at some point. Most of our major roads have become death traps. Water supply even in cities have become problematic and indeed all other aspects of our infrastructure have deteriorated. The problem is that the rate of expansion of infrastructure have not kept pace with increasing demands. Therefore, as population increases and people become more urbanised, the demand for all sorts of infrastructure will naturally increase very rapidly. The second issue is that the level of maintenance of these services have consistently deteriorated either due to inadequate resources available to the authorities to maintain these infrastructures or due to the inadequate capacity and expertise in providing maintenance. The third reason is that the expectations of people have increased and people are demanding a better quality of life. All these point to the fact that if we continue to rely on government to provide the infrastructure development, we might be disappointed. Government is clearly no longer in a position to provide these demands, not just in terms of hard infrastructure like roads and rail lines but even social infrastructure like schools and hospitals. Therefore, one way to deal with this is to identify areas which government can transfer responsibility for investment expansion, operation and maintenance to the private sector. But if you must do that, there must be a framework in order to ensure that it is done in a cost effective and socially responsible manner. That means you need an agency that will coordinate and regulate these relationship between government and the private sector and that is the purpose of creating ICRC as regulatory agency to provide the needed a regulation in the process of bringing the private sector and the public sector together.

WT: But looking at the areas of interventions, don’t you think your mandate may interfere or duplicate the operations of some government agencies or ministries?

Ahmed: The intention of setting-up the Commission is not that the Commission will now go and execute the projects we are talking about even if they are public private partnership. It is not like the defunct Petroleum Trust Fund (PTF) which will take government money and execute projects. The ICRC will work through ministries in about four major areas. First, we will provide the guidelines for any ministry interested in partnering with the private sector on how to do so. Secondly, we will work and support the ministry to go through the process of identifying which projects should be done by this arrangement. This is because it is not every project that can be done through the PPP. Some projects are best done through normal government investment. For example, if you want to go into power plant, we’ll make sure it goes through competitive and transparent basis to ensure that we get value for money. Thirdly, having selected and procured the project, ICRC will work with the ministry to ensure that the project is properly implemented. And the fourth area is that having gone through these three processes, ICRC will then monitor the implementation of the project for a number of years to ensure that both public and private sectors perform their responsibilities inline with the agreement they have signed. Even signing the agreement, ICRC has the responsibility to look at the risk involved because every project has a certain risk. ICRC will make sure that the correct party in the project takes the risk.

WT: But considering the high level of poverty in the country, do you think the public would be able to pay for services provided by the private sector?

Ahmed: I think the people should be more concerned with the availability and quality of the services. The availability of an infrastructure is more important than the fees. However, ICRC will ensure that services are affordable.

WT: Can you tell us what the ICRC board has been doing since it was inaugurated last year?

Ahmed: The board was inaugurated towards the end of 2008, precisely in November. It started sitting in January .The first thing we did was to create the institutional environment and basic facilities needed to be able to operate. This is the major area the ICRC has been focussing in the last four months. We have done a lot of work preparing the policy framework and we have also produced the National Policy on PPP. We also have a guideline on risk analysis. There is a guideline on value for money analysis too. Therefore, we are going to publish some of these guidelines in the middle of this month for the public to see.

WT: How do you intend to enforce your mandate or stop a project that you think is not viable?

Ahmed: Our responsibility is to advice the President directly. So, when we review a particular project, we send our advice to the President who can then take it up with the Federal Executive Council. We cannot stop a project that has already been approved by the executive but we can advice the Council. That is the role of the ICRC. The Presidency has indicated a strong commitment to listen to the ICRC advice. I believe that the ICRC will play a tremendous role in ensuring that public sector services especially infrastructure as they come up, will be of higher quality and better structure. Our expectations are that ministries should understand that our role is to help them achieve their objectives and not to hijack their projects. It is in their own interest to consult ICRC at the earliest time before committing themselves to projects. ICRC has been adequately taken care of by government and we are working with several international agencies to be able to deliver to ministries, the necessary professional advice to ensure that their projects are better structured.

WT: Is there any country where this PPP model has been successful?

Ahmed: The PPP arrangement was initiated in Britain about 20 years ago. Britain used it for social infrastructure rather than economic infrastructure because their economic infrastructure had been developed already. So, the intervention in Britain is in the areas of schools, hospital and prisons through what they calls Public Finance Initiative. India has made tremendous progress with PPP in the areas of highway and electricity likewise in Korea, Argentina, China and Brazil. In fact all the countries that have developed rapidly in the last ten years used the PPP model. South Africa is another good example. We have studied the success story of these countries and added our own peculiarities to arrive at the guidelines.