The Public Accounts Committee (PAC) of the House of Representatives on Wednesday, 24th January 2024, grilled the Director General of the National Institute of Pharmaceutic Research and Development (NIPRD), Dr. Obi Adigwu.
He was questioned over the utilization of the N4 billion allocated to the institute under the COVID-19 intervention fund.
The House Committee summoned the NIPRD boss alongside his subordinates and underwent rigorous scrutiny during the investigative hearing presided over by Representative Bamidele Salam.
In his remarks, the Director General said that the intervention funds were split into two which saw it allocating 50 per cent to capital projects and 50 per cent to recurrent expenditures in alignment with appropriation bills.
He however confirmed that a higher percentage of the N4 billion was used for implementation of capital projects including acquisition of 150 various equipment, 5-storey laboratory facility upgrades, staff training, research and development activities, and procurement of diesel, among other expenditures in breach of the Appropriation Act.
Documents submitted revealed to the Committee that NIPRD awarded contracts for the supply of 33,000 litres of AGO (Diesel) worth N14 million in October 2022; while N36.8 million and N60 million of contracts were also awarded in 2023. This discrepancy raised concerns among committee members.
Committee member, Hon. Aliyu Bappa Misau accused the NIPRD helmsman of committing various financial infractions, queried Dr. Adigwe for failing to sign the minutes of one of Tenders Board resolutions where various contracts were approved.
Lawmakers expressed displeasure on the Institute’s activities demanded relevant approvals for various contracts worth N535 million, N549.392 million and over N699.179 million, N685.691 million among others paid for by the Institute as well as remittances with respect to statutory deductions of WHT, VAT, and Stamp Duty.
The DG responded to various questions raised by the lawmakers on the award of multi-billion naira above the approved threshold as well as non-remittance of statutory deductions namely: Stamp Duty, Value Added Tax (VAT), and Withholding Tax (WHT) before payment to contractors.
He also noted that the statutory deduction from the 30 percent mobilisation fee paid to the contractors was not deducted to enable the contractors to perform effectively. He however noted that the money was deducted later.
The lawmakers also demanded the whereabouts of the excess funds worth over N60 million being the recommendations of the Bureau of Public Procurement (BPP) which reviewed the contracts awarded to three companies downward during the period under review.
The lawmakers, visibly furious over infractions, sought details on excess funds recommended by the BPP, which reviewed contracts downward by N41 million and another contract by N12 million.
They further alleged that some of the contracts were paid fully before the review by BPP.
He also argued that after the downward review of the contracts awarded to the three contractors, BPP said the contractors should supply additional equipment for the N765 million but noted that the contractors couldn’t supply them.
When asked about the approved threshold for heads of agencies, Dr. Adigwe disclosed that he has approving power of up to N10 million for services and N20 million for works.
When asked whether the NIPRD Director General secured approval after the end of the COVID-19 pandemic from relevant approving authorities including the Ministerial Tender Board, Dr. Adigwe, who earlier argued that all the contracts above his approving threshold were within the Tenders Board threshold and in line with the Emergency procurement guidelines, urged the Committee to allow him to verify.
Contradicting his earlier submission that he complies with BPP’s circular, explained that he got both pre and post approval from BPP and the Ministry, however, reversed himself saying he had post engagement with the relevant authorities.
He also affirmed that the sum of N76 million was mopped up by the Government against N60 million, hence the lawmakers requested evidence of the fund mopped up from the office of Accountant General of the Federation.
After the cross examination of the documents and presentation made by the NIPRD Director General and his team, Dr. Adigwe informed the Committee that the N765 million was not paid to the Contractor but utilised for other projects in the Institute.
The Committee also requested that the bill of quantity and scope of the contracts awarded be submitted to the Committee.
The Chairman, Rep. Salam said that the discretional utilisation of the N4 billion approved for the Institute was a major offence that is punishable under the financial law and regulations.
He maintained that it does not lie in the power of NIPRD Director General to use the money for whatever he feels is appropriate, hence should have solicited for National Assembly’s approval through relevant Standing Committees for virement.
He further observed that the NIPRD helmsman cannot sit in the comfort of the Institute and turn himself to an approving authority by usurping the powers of the National Assembly.
While stressing that the NIPRD Director General committed about three offences as provided by extant financial regulations.
Hon. Aliyu Bappa Misau proposed a motion for the DG and his team to reappear with proper documentation
Hon. Chinedu Emeka supported the motion and further amended it to reflect that the three companies involved in the multi-billion naira contracts were to also appear in subsequent hearings.
The motion was put to vote and it was unanimously adopted by members, as seconded by Rep. Ari Mohammed
The committee chairman ruled that the Institute should reappear at a date to be communicated and that three queries from the Auditor-General would be forwarded for their response as well.