Monday, June 8, 2009

Gov. Fashola, DPA and Alpha-Beta Consultants

During the mid-term anniversary of Gov. Raji Fashola, Democratic Peoples’ Alliance (DPA) Director of Publicity, Felix Oboagwina, noted that the Lagos state government has been harbouring waste in the system for paying no less than N36 billion to the Alpha-Beta Consultancy Limited from the internally-generated revenue of over N240 billion.

The need for Internally Generated Revenue (IGR) has been increasingly important for state governments following recent decline in price of crude oil - which impacted significantly on revenue allocation. Prior to the global financial crisis, most State executives were fond of going to sleep for 29 days only to turn up in Abuja at the end of the month to collect their share of nation’s oil proceeds.

With regards to Lagos, Col. Buba Marwa, increased the state IGR to over N600 million from the N100 million he inherited. And by the end of the tenure of Bola Tinubu, IGR was over N10 billion. And now under the governorship of Babatunde Fashola, IGR in Lagos State is over N200 billion. The revenue collection was contracted out to private consultants Alpha-Beta under Tinubu and Fashola administration.

Whilst it is important to give credit to Ex-Governor Bola Tinubu and Gov. Raji Fashola for their innovation and efforts in increasing the state IGR, it is also important that the issues raised by DPA are not swept under the carpet. Alpha-Beta Consulting Ltd is paid 15% of the state IGR, and DPA wants the government to review its terms of engagement with consultancy firm.

I will note that engagement of consultants in the area of revenue collection did not start with Gov. Raji Fashola or his predecessor. Col. Buba Marwa contracted revenue collection to Olusola Adekanola and Co. during his administration. However, whether this practice is ‘legal’ is a matter for the Federal Inland Revenue Service (FIRS).

However, the issue in this matter borders on probity and accountability. If I’m a Lagos state taxpayer, I will want to know more about the "process" undertaken to engage a consultant that is paid N3 billion monthly. The questions Gov. Fashola should be asked are, why was Alpha-Beta selected as the preferred consultant? Did the government invite consultancy bids for the contract? How many consultancy companies submitted bids for the contract? Considering that Alpha-Beta has no known track record of revenue collection, what were the criteria used in selecting Alpha-Beta?

There are also rumours in certain quarters that Alpha-Beta is owned by Ex-Governor Bola Tinubu. Whilst Gov. Fashola has neither confirmed nor denied these rumours, I will note that the rumours remain unsubstantiated. If principle of ‘due process’ was adhered to, then does it really matter who owns the company?

Ex-Governor Bola Tinubu is a citizen like everyone else, and he has the right to sit on the board of private companies or engage in private business. And as far as I’m aware, there is no law in the Nigeria that precludes former political office holders from lobbying for government contracts. In fact this is a common practice in the western world because private companies believe politicians have the right contacts within the government. The issue for the government is to make sure that any percieved 'conflict of interest' is adequately addressed. So if indeed Alpha-Beta is owned by Ex-Governor Bola Tinubu, Gov.Fashola needs to let the public know that there wasn't any ‘conflict of interest’ in way and manner the contract was handled.

Considering Gov. Fashola’s good work in Lagos, and the clear evidence of phenomenal increase in IGR since his assumption of office, some will argue that Gov. Fashola does not owe anyone any explanation on the Alpha-Beta contract. My question to such people is, how are we sure that the Alpha-Beta contract provides ‘value-for-money’ to the taxpayers? Because ultimately, it’s taxpayers’ money that is been used to pay for their services. The fact that an administrator is performing well does not mean that he should not be held accountable for his actions. Alpha-Beta charges 15% of the state IGR, what makes us think that another company couldn’t have provided same service at a lower cost – say 10%? I want to agree with DPA that N36 billion is a colossal amount of money to pay an individual firm over a two-year period. And if such amount of money is channelled into any sector, it is inevitable that impact will be felt.

Whilst the payment to Alpha-Beta might be seen as a ‘waste’ by the opposition, Gov. Fashola’s response to the questions raised above might just help quell the rumours and provide a justification for such expenditure in the state budget, especially in the current economic climate.


Anonymous said...

This is Interesting!!!

Anonymous said...

pls tell alphabeta to confirm their pending workers as staffs and also increase therir salaries too especailly the ppc agents plaese oo govt tinubu n fashola tanks.