Audit query reveals how government agency sold over 2 billion assets for 13 million naira

The Federation Auditor General’s Office has revealed how the sale of a Government Plant, Property and Equipment (PPE) valued at over N2 billion was sold for N13.618 million by a federal government agency.

This was made known by the Public Accounts Committee (PAC) of the House of Representatives, which kicked against the sales.

The transaction was carried out by the Ogun-Osun River Basin Development Authority.

Auction details included an 800 KVA Perkins Diesel generator purchased for an undisclosed sum by the agency in 2006 but sold for N550,000 in 2018 after being declared unserviceable, according to a document; a CAT payload loader bought for N70,000 in 1982 but sold for N40,000, while other earthmoving equipment, such as bulldozers, graders and excavators were sold for between N350,000 and N550,000 as items unusable.

Others include a Toyota Camry 2.5L bought in 2013 for N8.150 million and sold for N22,500; trimmers purchased in 2004 and lawnmowers purchased in 2004 sold for N2,000 and N6,500 respectively. There were also three Peugeot 504 station wagons purchased at N2.9 million each but sold for N26,400 each.

In addition, a Mistubushi gallop truck which cost the agency N8.55 million was also sold as scrap for N80,000, while a DAF truck (1000) purchased for N5 million was sold for 90,000 naira.

Similarly, a Toyota Hilux bought for N3.75 million was also sold for N187,500.

Olufemi Odumosu, chief executive of the agency, who appeared before the committee, said the Federal Ministry of Water Resources, which approved the public auction of the equipment, also appointed the auctioneers.

Testifying at the hearing, Odumosu said the PPE auction was conducted in the late 1970s and early 1980s, even though documents presented to the committee attested to the fact that the oldest properties of the agency had been acquired in 1980 while the most recent had been purchased in 2013.

Odumosu had during the hearing tried to withdraw the documents and replace them with another but failed because the committee refused, Avant-garde reports.

In his communication dated May 16, 2022, the MD said: “Your observation, which is however noted, was based on the fact that at the time of the disposal, the authority could not get hold of all the paintings historical costs relating to these unusable items. “It’s mainly because they (the unusable items) were purchased from the late 1970s to the early 1980s when the authority’s operations began spanning a period of 35 to 40 years.

“In the meantime, most of the officers directly involved in the purchase were either deceased, retired, or both. However, thanks to the frantic efforts made (in the past which have been repeated) to call back the living pensioners concerned to assist in the archival retrieval of the documents relating to the purchase of the items, they have yielded significant results.

In his reaction, House Public Accounts Committee Chairman Wole Oke ripped holes in the way auctioneers are selected, insisting that the provisions of the Public Procurement Act, PPA, were breached, causing the government to lose revenue.

The committee therefore requested the minister of water resources and the permanent secretary of the ministry to appear before the committee on June 9 to explain their role in the auction.