...N2.4Bn assets rot away as govt borrows N100Bn to fund capital projects
…over 1,000 workers shun offices as weeds takes over meat processing factory
…N2billion fiscal budget suffers release
…Govt has no business in doing business, expert says
By Rauf Oyewole
The Bauchi State-owned assets are practically becoming liabilities as most of the companies have become moribund several years after their establishment, this is the government reluctantly carries on with the overhead costs and salaries for the idle workers of some near worthless facilities.
Correspondents’ Watch findings showed that mismanagement and corruption of the successive administrations have grounded the multi-billion naira companies that have employed thousands of residents in the past. Also, the companies are down with obsolete machines and equipment that had pushed them out of business while the facilities now live on their past glories.
Some of the state-owned moribund assets include; Bauchi State Meat Product Company, Fertiliser Blending Company, Galambi Cattle Ranch, Alien Cables and Wires, Bauchi Furniture Company. The Meat Product Company which was established decades ago was refurbished in 2001 by then-President Olusegun Obasanjo to export meat via train services from the Company in Bauchi to Lagos, Port Harcourt and Saudi Arabia as it was accepted as halal (permissible).
The Company was sourcing its animals from the Galambi Cattle Ranch, owned by the state while dairy products were an additional source of income to the government. While the Fertilizer Blending Company was rolling out products for the farmers at affordable prices to boost the agricultural sector, Alien Cables was the first choice in Nigeria. Also, the Furniture Company that was producing most of the furniture used in both public and private offices is on its knees. Currently, the meat company has lost its glory. Fertilizer Blending Company produces only when the government borrows billions of naira to put out products for farmers against the rainy season farming.
While there are no more animals at the Galambi Cattle Ranch, the Meat Factory is taken over by weeds. When our reporter visited the company, it was observed that most of the sections of the company were deserted with only a few administrative and security staff who only go to the office to sit.
For the state's tallest 180-room Zaranda Hotel which was established in 1980 as the flagship of hospitality in the state. Zaranda Hotel attracts visitors and tourists from far and near. The edifice has become unattractive to guests as many regret booking rooms in the facility due to poor service delivery. A first time guest, Gabriel Samuel who spoke with our reporter said she saw the “beautiful old pictures” of the Hotel online but was disappointed to see that the service was poor.
“It was so attractive from afar, I thought I was going to experience the standard Eko Hotel. I got here to see an outdated facility with poor service. The swimming pool is dried up. The mattresses and bedspread are old. The furniture is so chopped off and overused.”
Also, a social media influencer, @waka_waka_nnenna who posted her experience on Instagram and Facebook, saying that: “We saw this hotel on Google that looked like Transcorp Hilton, we were so excited that we were getting the “Bauchi Transcorp” for cheap. Well, we got the biggest shock of our lives as we entered and everywhere was smelling izal. Floors were so dirty and elevator was doing skoin skoin (slowly). We were surprised that they off their water at night but the security guy boiled water for us. Well we consoled ourselves with the views around the hotel.”
It was observed that the recreation section of the Hotel is taken over by weeds and Sport facilities are unattractive to the guests.
In 2021, the government through the Bauchi State Bureau of Privatisation and Economic Reform advertised to lease out some of the companies. After screening the bidders, it said that it had selected some of the successful private investors.
In August 2022, Zaranda Hotel valued N1.2 Billion for a period of 25 years to the winner, Butfield and another State owned hotel, Wikki Hotel at N200 million.
A popular businessman from Bauchi, AYM Shafa defeated two others and emerged the preferred bidder of the Bauchi Fertilizer and Blending Company after offering 80 percent of the shares at a price of N400 million.
New Frontier was the preferred bidder to acquire 75 percent of Bauchi Meat Factory at N301 million. Meanwhile, Galambi Cattle Ranch was acquired for N150 million by H & Y Global Ventures for N150 million.
Meanwhile, in 2021 the state governor Bala Mohammed announced a loan of N1 billion to fund the Fertilizer Company to meet up with the 2022 farming season. Also, finding at the Company, showed that the government also took a N2 Billion bond from UBA to produce fertilizer at subsidised rate for the farmers which the Company had in 2023 supplied to the Bauchi State Agricultural Supply Company (BASAC).
The Company which operates with its obsolete machines has over 70 workforce while about 300 labourers are attached and does not produce anything until loan facility is taken. A top management staff told this medium that the company had written to the government to replace the outdated machine with new ones but it has yielded no positive results. Few of the staff were seen at the gate with the management staff who resumed office with no output.
Last year, the government budgeted N50 million to refurbish the fertilizer Company meanwhile, the 2023 budget performance analysis showed that nothing was released. N5million was to be spent on the Meat Product Company with no release. In the 2023 budget, there was N1 billion provision for the Galambi Cattle Ranch; the available document showed nothing was released as at December 2023. Meanwhile, out of the N64,187,400 budgeted for personnel expenditures the same year, N43,342,724 was expended. Also, out of the N11 million proposed to be spent on overhead cost, only about N2 million was released.
In 2021, Bauchi State's internally generated revenue (IGR) stood at N17.9 billion while it recorded an improvement in 2022 with N25.5 billion IGR according to the National Bureau of Statistics (NBS).
Meanwhile, the State Governor Bala Mohammed said that his administration had borrowed the sum of N100 billion to fund capital projects while it expended over N90 billion as at November last year.
Finding revealed that the privatisation process is on hold, the state of the Ministry of Commerce was just posted to head the Zaranda Hotel about four ago, while the management of other assets were seen in charge of the listed assets for leasing. The Acting Director General of the Bauchi State Bureau of Privatisation and Economic Reform, Barr. Kabir Ishaq, said that he could not comment on the process of privatisation as he was not part of it.
He said that only the former DG, now the Secretary to the State Government, Barr. Ibrahim Kashim is competent to talk about the process. An enquiry sent to Barr. Kashim, he acknowledged and promised to get his details for the paper, he is yet to do so since January, 2024.
Although, experts said that the mismanagement of state-owned companies is a big cog in the development of the state. Economists believed that the assets could have been leased out to years back to private investors while the government directed the money to fund critical infrastructure deficits of the state and limit debt.
Speaking, Professor Idi Samaila of the Department of Management Sciences, Abubakar Tafawa Balewa University, Bauchi, said that the government has no business in managing the business, he believes that private investors could manage such assets effectively.
“Government establishments almost everywhere are always crippled by corruption and nepotism. These won't yield positive results. The assets in question should be major employers of labour but what are having today? I don't know what is delaying them but no matter what the situation might be I believe that the government has no business in business.”
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