The Senate Public Account Committee has asked the Nigeria Bulk Electricity Trading Plc to explain how it managed the sum of N50bn in its Escrow Account.
The Chairman of the committee, Senator Matthew Urhoghide, issued the directive based on the 2015 audit report by the Office of the Auditor General for the Federation submitted to the committee for probing and presentation to the senate.
The AuGF report stated that it was discovered that the renegotiation was carried out after two years from 0.02 to 2 percent per annum.
The report noted that the N50bn in the Escrow account was the proceed from sale of the Egbin, Omotosho and Olorunsogo power plants.
Part of the query reads, “Funds in form of escrows in the possession of Egbin Escrow agreement: FCMB Escrow Account BPE/NBET 2435507018- N30,000,000.000; UBA Escrow Account BPE/NBET 1017699148 – N10,000,000,000.00; FBN Escrow Account BPE/NBET 2024063360 – N10,000,000,000.00.
“The following observations were made: There was no execution date as the agreement only stated 2013.
“This has been left out deliberately and arouses suspicion of malpractices. This is evidenced by a mail sent by the Legal Counsel to the Bureau of Public Enterprises (BPE), asking for this information which was never replied to.
“The minutes of the meeting that decided the concessionary rate and the obligation of the escrow agents, necessitating any form of consideration as well as the identities of the attendants and parties to the proposed and implemented 0.025 percent interest on the escrow fund, should be produced.
“It is pertinent to note the financial mismanagement in the sum of over N5,000,000,000.00 (Five billion naira) which would have been realized on the investment of the funds in Nigeria Treasury Bills at an interest rate of 10 per cent.”
NBET in its written response said, “It was never stated that the fund will be invested in the Treasury Bill. However. with the reduction in CRR, the rates on sitting balance for the Egbin was renegotiated to 2 percent from 0.02 percent per annum effective July 01, 2015.”
The Senate panel chairman, while ruling on the AuGF query and the response of the NBET, asked the management of the agency to produce all necessary documents regarding the transactions.