By; BAYO AKAMO, Ibadan
Former Deputy governor of Osun State, Senator Iyiola Omisore on Wednesday said that Nigeria needs PPP to enhance the country’s infrastructural development.
Senator Omisore stated this while delivering a lecture titled “Public Private Partnership: Solution to the Infrastructure deficit in Nigeria at the Obafemi Awolowo University (OAU), Staff Club, Ile Ife.
He pointed out that since the advent of globalisation, much promoted by internet technology, some twenty five years ago, the world outside of its Southern hemisphere, “the era of government at every level of Nations political economy, being solely management for the total conception, financing and management of public projects has since ceased to be the norm, as there has been much and involving contractual relationship between the public and private sector of the polity in the procurement of public utilities under an arrangement known as public private partnership (PPP).
According to the former Chairman Senate Committee on Appropriation, “whereas,
“Until very recently, there was simply no regulatory framework for PPP in Nigeria. PPP in line with the different methods of financing same was to a large extent an alien concept. In fairness to the public service, there were no precedents or reference points. And, as suggested in my introductory remarks, there was clearly a serious knowledge deficit on the part of the regulators in dealing with issues. And these posed major problems to both sides of the transaction which may have accounted, to a large extent, for some of the challenges in the early period of the PPP arrangements,” he said.
Senator Omisore added that “for example, the insufficient knowledge of the nature of PPP is largely responsible for the perception that the scheme is primarily for revenue generation, rather than to provide infrastructure or services required by the public, as quickly as possible and in the most efficient manner”.
“Outside of Lagos State, cursory survey of the infrastructure procurement by state governments is still largely tied to the old model of contract awards to private firms to execute a project designed and financed by governments. Thus, on the average, Nigeria has fared, rather poorly, especially in view of the country’s need for requisite infrastructure for nation’s potential developmental capacity”.
The former governor stressed further that “my intervention in the following submission is anchored on a very straight forward argument to the extent that, even with real needs and potential returns on investment by investors, inadequate provisions in the legal framework to sufficiently safeguard investors and financiers interest may continue to constitute major road blocks for Nigeria, at all levels of Nigerian authorities in the country’s PPP drive for the much needed public procurement of utilities and services”.
Speaking further, the former deputy governor noted that “in bringing this round table to a close, it is important that we do not gloss over the political and cultural issues that often constitute major disincentives to public procurement, via PPP arrangement”saying,“one of the issues is absence of political will on the part of an administration to see through the policies of a previous administration”.
“And because concessionaires are aware of a negative tendency by a new administration not to honour, to the latter, all the tenets of an arrangement by a departed administration, they are often inclined to speed up the commissioning of projects before the date of departure of a sitting administration, with avoidable increase in the cost of project. Yet, except there is a determination that a PPP succeed, there are offer sufficient vested interests in a country, especially in a multi-faith and multi-ethnic country like Nigeria to ensure that the governments initiative to promote PPP as a policy fail. Public-private partnership projects often encounter serious resistance from labour unions, civil service employees and sundry socio-economic interest groups.
Also, present is the negative understanding by the general public, borne out of ignorance, on the strategic importance of PP in a nation’s socio-economic development. Whereas, PPP, are meant to be partnership contractual arrangement between the public and private sectors of the economy, in which responsibilities, risks and obligations, are to be shared by both sides in order to guarantee the greatest benefits to the public, but regrettably, in Nigeria, a segment of the public service operators tend to see the private sector concessionaires as the enemies that would deprive them of their jobs, therefore, to be overcome at all cost. And this is often achieved when some extant rules in the civil service are exhumed to advice the government on why all of a PPP undertaking, or some aspects of PPP project agreement should not be honoured, thereby leading to government unilaterally rebiding on contracts voluntarily entered. And with a weak legal framework, under which concessionaires can be protected, the tendency is for the private sector operators, both from within and from outside of the country, to be wary of doing business with government. Thus, timely procurement of public utilities suffers and the socio-economic development and the country is the worse for it”.
