How NSITF Violated Procurement Law In Acquisition Of N146m Vehicles- Audit Report — Nairalovers

…Only 16 Out Of 22 Vehicles Paid For Were Supplied

Facts have emerged as to how the Nigeria Social Insurance Trust Fund violated the Public Procurement Act of 2007 in the award of contracts for the acquisition of 22 vehicles valued at N146.02m.

Details of the infractions are contained in the Audit Report on the agency which was carried out by the Office of the Auditor-General for the Federation.

According to the Report, the contract for the supply of the 22 motor vehicles was awarded at a contract sum of N146,027,227.00, vide award letter referenced NSITF/MD/CE/12 with two weeks completion period.

The vehicles are 1 Unit of Range Rover Vogue 4 x 4 SUV valued at N19,740,050.00; 15 Units of Ford Ranger 4 x 4 Pick-up worth N87,750,000.00; and 6 Units of MG550 Saloon vehicles valued at N24,960,000.

The Report added that the sum of N6,623, 500 was for delivery, security, sundry (preliminaries) while VAT was estimated at N6,953,677

The Auditor-General also revealed in the Report that the award of the contract negates the due process policy of the Federal Government and also the provisions of Financial Regulations 2921(i)

Financial Regulation 2921(i) states, “Except as exempted under the Procurement Act, all procurement of goods, works and services shall be by way of Open Competitive Bidding by which is meant that all contractors/suppliers shall be subjected to the same level playing ground.

“The format for submission of bids, the deadline for submission and the pre-determined criteria for evaluation shall not vary from one contractor/supplier to the other; they shall be the same”
The Report which was obtained by THE WHISTLER revealed that necessary contract documents such as evidence of advertisement in two National dailies, Ministerial Tenders Board approval among others, were not produced for audit examination despite repeated request.

Part of the Report stated, “The following irregularities were further discovered; the contract was awarded without following necessary procurement procedures as spelt out in the Public Procurement Act, 2007; a sum of N6,623,500.00 was included as cost of delivery, security, sundry (preliminaries) without detailed breakdown showing how the amount was utilized, while the sum of N146, 027,227 was allegedly paid by the NSITF.”

It added. “The audit observed that the actual amount paid to the contractor through payment voucher No. 02310 was N139, 073,550.”

It was stated in the Report that based on the payment voucher; only 16 vehicles were supplied to the Fund, whereas supporting documents reflected 22 vehicles that were paid for.

This, the Audit Report noted, put “doubt on the genuineness of the transaction.”

It added, “There was no record of distribution/location of vehicles claimed to have been received in the store, vide SRV No. 0025.

“Audit enquiry showed that the store officer was only called upon to sight some vehicles at the contractor’s premises, but without the knowledge or information on how they were distributed.

“This could lead to diversion, loss of resources and misappropriation. No Management’s response was received at the time of this report.”

The Auditor-General in the Report recommended that the Managing Director should be made to justify the payment of the sum of N146,027,227 for contract awarded without due process, failing which sanctions in line with Financial Regulation 3106 should apply.

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