How NERC officials share billions as perks while Nigerians lament increased electricity tariff

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Premium Times report shows how Nigeria’s regulatory agency’s staff share billions as perks while Nigerians are burdened with increased electricity tariff that has left many consumers unable to pay.

Nigerians have always raised doubts about the neutrality of NERC, but the report by Premium Times exposes a high level of compromise by the officials of NERC.

At a time many Nigerians are grumbling about the increase in electricity tariff, and members of the board of the Nigerian Electricity Regulatory Commission (NERC), have illegally paid themselves billions as salaries, severance entitlements and to purchase exotic cars, which were allegedly registered in their names, PREMIUM TIMES has learnt.

The decisions of the are in clear violations of the extant regulations such as the Procurement Act 2007 and the Electric Power Sector Reform Act 2005.

PREMIUM TIMES is in possession of a sent to the Economic and Financial Crimes Commission by a concerned individual, who did not want to be named, with details of the illegal jumbo payments.

James Momoh, the immediate past chairperson of the commission, confirmed that the payments were indeed made, adding that the decision was jointly taken by the board.

NERC was established in October 2005 after the enactment of the Electric Power Sector Reform Act 2005. The commission’s mandate includes licensing, determining operating codes and standards, establishing customer rights and obligations and setting cost reflective of industry tariffs.

The agency, by law, is funded through 1.5 per cent of charges paid to the distribution companies by electricity customers.

But since its establishment, the agency has been mired in financial scandals.

Its first board, led by Ransome Owan, was dissolved in 2008 over an allegation of corruption. An administrator was appointed to head the commission until 2010 before a new board led by Sam Amadi was constituted.

However, the Mr Amadi-led board was also accused of illegally allocating huge sums as severance packages for the board members, among other allegations. The allegations were denied by Mr Amadi.

Exotic cars
According to the petitioner, the seven of NERC recently paid N75 million each to themselves amounting to a total sum of N525 million for the purchase of exotic cars. The cars were also registered in their names.

Earlier in 2018, the board, through its supervising ministry, submitted a memo to President Muhammadu Buhari through the Federal Executive Council (FEC) to seek approval for the purchase of sport utility vehicles (Toyota Land Cruiser) for its seven to the tune of N450 million.

Irked by what was described as an insensitive request, the FEC reportedly rejected the request and advised the agency to patronise Innoson Vehicle Manufacturing Company Limited, a local vehicle manufacturing company that is based in Anambra State.

Dissatisfied with the president’s decision, the board reportedly circumvented the directive by paying each of the N75 million.

According to the petitioner and other sources, the money was then used by the to import sport utility vehicles from the United Arab Emirates (UAE), while other sedan vehicles were purchased from other unidentified sources.

The reads in part; “From these monies, six exotic and expensive jeeps were bought from Dubai, the United Arab Emirates and seven utility vehicles from various sources with each commissioner having one SUV jeep and another sedan vehicle, while the chairman only bought a sedan, having inherited upon resumption, a newly acquired SUV as his operational vehicle.

“All procured vehicles were bought and registered in the names of these commissioners despite the fact that they had, from inception, allocated to themselves, the best of the commission’s SUV and other cars as operational vehicles, fully maintained by the commission, inclusive of attached drivers by the commission for close to 42 months.”

The petitioner added that the vehicles were bought less 16 months to the end of the tenure of the commissioners and that the process did not follow the Public Procurement Act.

“The intent of this fraudulent and brazen act of the seven commissioners is to go with these highly-priced vehicles upon the expiration of their tenure in 16 months’ time,” the further noted.

According to Section 19 (a) of the Procurement Act 2007 “Subject to regulations as may from time to time be made by the public procurement bureau, under the direction of Council, a procuring entity shall, in implementing its procurement plans: (a) advertise and solicit for bids in adherence to this Act and guidelines as may be issued by the Bureau from time to time.”

Severance package
In a manner similar to its predecessor, the current board of the agency has also allegedly approved the payment of huge sums to the commissioners as severance packages even while its tenure is far from ending.

According to the petition, the illegal increase in the salaries of the commissioner amounting to about 200 per cent of the approved scale by the National Salaries, Incomes and Wages Commission, has further increased what each of the commissioners budgeted for themselves as severance package.

“The current remuneration of the commissioners of NERC is also against the directives of the house committee on power as shown in the attached report. The commissioners also approved and paid themselves a humongous sum as Covid-19 palliative and special duties allowance with total disregards to the same section of the Act,” the petitioner wrote.

According to the report referred to by the petitioner, the chairperson of the NERC board currently earns an annual income of N83.4 million as against N59.9 million approved by the wages commission.

Arbitrary salary increase/ Appointment of aides