Federal Govt Raises N130bn From Assets Privatisation

Director-general of the Bureau of Public Enterprises, (BPE), Mr Alex Okoh has said the federal government raised the sum of N130 billion through the various privatisation, reforms and asset uptimatimisation activities of the bureau in the last four years.

“The sector reforms that we have carried out, apart from making life a lot easier for the citizens, also serve to conserve funds for the federal government because ordinarily there would have been subvension paid out to those assets and enterprises that have been reformed to be more commercial in their operations,” Mr Okoh said yesterday in an interview with journalists in Abuja.

The DG said the Nigerian Postal Service (NIPOST) is one of the agencies of government that have been unbundled. Mr Okoh said NIPOST properties is now a separate entity from the postal service, the same way NIPOST transport and logistics has also become a separate entity. He informed that these two entities will become operational from the first of January 2023.

“We just concluded the recruitment of the management staff of those two entities. They will become operational from the first of January next year,” he said. “The implication of that is that the subvention from the fiscal purse that would have been going to the Service will no longer go there, and that is savings on the part of government.”

He said that he is optimistic that the BPE will exceed the N260 billion projection in the 2023 budget with the completion of the sale of five National Independent Power Plants (NIPPs).

“We are reaching some understanding with the state governments for the sale of five power plants, that is what has dragged this transaction for the past two years,” he said, adding, “Thankfully as at last week we were able to resolve with the governors.  So for those assets we are likely to reach financial opening of the bids before this year runs out but the proceeds itself will come in the first quarter of next year.

“So we actually project that in the first quarter of next year, that is by March, we would be able to exceed the expectations of the budget for N260 billion.

“Let me also add that from the projected sum from the sale of the assets the portion that actually becomes available for the funding of the Federal Government is 47 percent,  53 percent goes to the states because the assets are not federal assets but federation assets.”

On the electricity distribution companies  ( DisCos), Okoh said it is wrong for people to say the federal government took over the DisCos.

According to him, “It is not a government takeover of the core investors because that will negate the process of privatisation itself.

This is purely a commercial transaction between a lender and a borrower. A borrower in this case being the core investors in the 60 per cent shares of the DisCos.

“According to the loan agreement, the banks are to repossess the DisCos should the core investors fail to pay back the loans. That is what has happened. I know that in some quarters people are saying government took over the DisCos,  nothing of such happened. The banks were allowed to step in to exercise their rights over the shares.”Mr. Korie said the marketers have been assured by the government that the Port Harcourt Refinery would become operational in the New Year.