SUKUK Bond: FG Disbursed N221bn to Road Contractors
The Federal Ministry of Works and Housing has disclosed that N221bn has been disbursed to contractors as costs for the construction of 71 road projects completed in various parts of the country under the 2021 SUKUK bond funds.
This was as it refuted allegations by some aggrieved contractors in an online publication that funds allocated to projects in the 2022 SUKUK fund were being delayed and placed into bank accounts “To embezzle accrued interest.”
The rebuttal was issued in a statement titled, “For The Records. Re: Allegation On: “N130bn 2022 SUKUK Fund: Road Contractors Petition Efcc Over Non-payment Of Approved Funds Allocated To Them By Ministry Of Works Staff” and signed by the Director overseeing the office of Permanent Secretary, Folorunsho Esan, on Wednesday.
The ministry insisted that it completed the disbursement for the payment of executed contracts in the 2021 SUKUK funding adding that the payment ended in April 2022 and a total of N221bn was paid.
Esan stressed that payments for both years (2021 and 2022) could not be made concurrently as a matter of principle.
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Describing the allegations as a blatant misrepresentation of facts and a calculated attempt to smear the name of the Ministry, the Director said it is unfounded to imagine that any portion of the 2022 SUKUK Fund is warehoused in any bank with the expectation of yielding interest for any pecuniary benefits to officials in the ministry.
As a point of clarification, he noted that the ministry has been using the Sukuk model for project financing since 2017 and at no time held funds for project payments.
He also pointed out that “SUKUK Funds are domiciled in the Central Bank of Nigeria (CBN) and are only released to the Ministry for payment after the necessary processes and approvals are obtained.”
The statement read, “The attention of the Federal Ministry of Works & Housing has been drawn to allegations via an online publication wrongly accusing staff of the Federal Ministry of Works and Housing of refusing to disburse funds allocated for projects in the 2022 SUKUK Fund to contractors.
“For the records, this is a blatant misrepresentation of facts and a calculated attempt to smear the name of the Ministry. According to the operational guidelines for Sukuk projects, payments are made to contractors within twenty-four hours of the funds hitting the accounts of the ministry.
“Recall that the Debt Management Office approved the 2022 Sovereign SUKUK Funding of N110.00 billion for the execution of sixty-three (63No.) projects across the country with a symbolic presentation at the ministry of finance.
“But prior to the presentation of the 2022 SUKUK cheque, the Ministry was executing the 2021 SUKUK Funding in the sum of N210.565 billion for the construction of seventy-one (71No.) projects in the Federal Ministry of Works & Housing and N10.435 billion for the execution of five (5No.) highway projects by the Federal Ministry of Niger Delta Affairs which were transferred to the Works and Housing Ministry.
“It is important to note that the disbursement of the 2022 Sukuk could not be run concurrently with that of the 2021 Sukuk as a matter of principle.”
According to the statement, on completion of the 2022 verification process in early May 2023 and in line with the commitment of the ministry for payment of works executed according to the approved milestones, the first (1st)Tranche Drawdown in the sum of N19.605 billion was forwarded to DMO while subsequent tranches would be forwarded to the DMO as the contractors execute the projects in line with the approved milestones until the N130bn is fully accessed.
The ministry urged the public to always cross-check their facts before going to the media in order to avoid unsubstantiated allegations and avoidable waste of taxpayers’ money for energies that should be channeled into more productive ventures.
