Section 1 Some Failed Projects and Project Deliverables

This section is on some of the failed projects and project deliverables in some African countries and the causes of failures. The analysis of each example will include the following:

■ A description of the failed project

■ Causes of failure

The countries are Nigeria, Ghana and South Africa. Some failed projects in these countries are discussed in Chapters 2, 3 and 4 respectively. These are representative case studies. Countries and applications used here are examples as it has not been planned in this book to cover all the countries in Africa. The analysis will be sequential and conducted as follows:

■ Nigeria

■ Ghana

■ South Africa

Accounts have been given of real-life projects, operations and failures. The objective is to present actual examples of the problems that lead to the failure of projects and project deliverables. Efforts have been made to withhold names of persons since the intention is not to embarrass individuals. Our failings and shortcomings are not and should not be blamed on individuals but on systemic failures, underdevelopment and poor project management.

Examples of Failed Projects in Nigeria

As briefly stated in the introduction, a government commissioned audit revealed that 11,886 Nigerian Federal Government projects failed in 40 years up to 2011 (that is about 300 projects failed every year), with the attendant loss of billions of dollars. Reference was also made to the fact that in October 2016, a former Director-General of the Bureau of Public Procurement stated that there were 19,000 Nigerian Federal Government projects in various stages of abandonment. Some examples of major strategic industrial and scientific failed projects are examined in the next paragraphs.

Failed Nigerian Steel Industry

The iron and steel industry which was planned to be a catalyst for industrialisation failed in Nigeria for many years despite a promising start. However, between 2016 and 2019, efforts were made at reactivating some of the plants.

Initial Promising Start

Steel industrialisation was first embarked upon by the President Shehu Shagari administration between 1979 and 1983. The rolling mills were commissioned in Katsina, Oshogbo and Jos respectively. A rolling mill and a complex steel plant were also commissioned at the Delta Steel Company,

Aladja. Major construction and erection works were embarked upon at the Ajaokuta Steel Company which before it was abandoned was reportedly 98% completed. Iron-ore extraction at Itakpe was to serve as the source of raw materials for these rolling mills and the steel plants. There was a 20-year rolling plan for Nigeria’s industrialisation launched by the Shagari administration in 1980. The Russians started the construction at the Ajaokuta Steel Company and these enterprises were commissioned by Shagari. There was jubilation at this significant development. In spite of this initial start, the whole programme was later abandoned for over 36 years by the intervening military governments who overthrew the government of President Shehu Shagari.

Causes of Failure

■ Inability of the companies to generate fund for their operations rather depended on the Federal Government for their funding

■ Failure of the government to continue to fund their operations

As the government could not continue to finance the operations of the steel plants, it privatised them. Global Steel Holding Limited (GSHL), an Indian company, reportedly acquired both Ajaokuta Steel Company Limited and Delta Steel Company Limited in 2004 and 2005 respectively from President Obasanjo “to clear the outstanding workers’ salaries and take up the running of the plant.” The government could not manage some of the completed plant units. It was spending a lot of money to pay salaries of hundreds of workers who were producing no income. The plants could not earn income to pay for their operations.

Disagreement over Privatisation

Ajaokuta Steel Company Limited, Nigeria Iron Ore Mining Company (NIOMCO) at Itakpe in Kogi, Delta Steel Company Limited Aladja and ALSCON, the Aluminium Smelter Company of Nigeria at Ikot-Abasi, Akwa Ibom State were some of the major steel companies privatised during the presidency of President Obasanjo. There was a serious disagreement over the privatisations such that the incoming government of President Umaru Yar’Dua did not find them acceptable and therefore nullified them. This led to years of prolonged litigation between the Nigerian Federal Government and the buyers from 2004 until 2016 when President Buhari reached an out-of-court settlement.

Reasons for the Privatisation

Poor Return on Investment, Gross Inefficiency, and Source of Major Financial Drain on the Economy

The Director-General[1] of the Bureau of Public Enterprises (BPE) from 1999 to 2003 explained that the government embarked on privatisation to reduce or eliminate the drain that the inefficient public enterprises constituted on the public treasury. He said that he had 33 transactions, closed 23 companies and returned N57 billion to the Federal Government treasury. He explained that from 1970 to 1999, the Federal Government invested over $100 billion in building enterprises, but earned only a 0.5% return on investment. He said that the companies were costing the government N265 billion about $1.4 billion annually to maintain. According to him

the late 1970s was a period that public enterprises were not working instead they were not only a drain on the economy (but also) they were not providing services and not solving the problem they were meant to solve, but they were captured by the elites for their own benefits.

[D]uring Abdusalami’s regime, the budget of the Federal government was N300 billion, but we spent N265 billion (worth then about $2.65 billion) supporting inefficient, corrupt, and epileptic public enterprises. That was the philosophy behind privatisation and commercialisation of the companies. So, to blame privatisation for these companies not doing well is being economical with the truth.

For example, Nigerian Telecommunications Limited (NITEL) for 25 years only provided 400,000 telephone lines after it had invested $7 billion for the most expensive phone system in the world, and they actually thought they were doing you a favour if they gave you a telephone line. ... And to say that the purpose is to create jobs is wrong. That was not the mandate to BPE, it is to remove these companies from the treasury, make them more efficient, open up the market for competition so that other operators can come in.

In the year 2000, as at December 2000, the total liabilities of 39 public enterprises was in excess of N1.1 trillion (about Sil billion) and they had accumulated losses of N92 billion naira (about $0.92 billion), and they consumed over $3 billion USD per annum or about N10 million a day. The justification for selling them was very clear and we did it. The only thing that is working in Nigeria today is what is run by private sector. Today we produced 9000 megawatts of power in our homes with (personal and private) generators while the public power supplier, NEPA, is giving us 3000.

Zero Productivity with Regular Payments on Full Salaries

Sadly, in our concept of working for the government, when one reports to the office every day, one expects to be paid, and one is not really bothered whether or not any value is generated to one’s employer. The thinking is that the very act of reporting to work should attract a salary. For example, at the failed Nigeria Iron Ore Mining Company (NIOMCO), each day, a handful of the staff came around, signed their attendance register and sat in clusters for some idle chat, while some simply took a nap under trees or inside the broken-down units within the plant. They closed from their workplace when workers at other government ministries and agencies closed for the day. They generated zero income, yet they still reported to work on every working day and were paid.

“That’s a ritual we have been doing since this place stopped working,” said one of the workers, who declined to be identified because he was not allowed to talk to the press. Between 2010 and 2017, the Federal Government, according to the Budget Office of the Federation, budgeted N13-1 billion ($66 million) for the company, out of which N12.4 billion ($62million) was paid as salary. The government kept allocating budget to pay workers’ salaries at Ajaokuta. In 7 years, N29-9billion was spent paying workers out of the total N30.9 billion ($155 million) budgeted for both personnel and overhead for the plant. Yet the plant was not functioning, and the workers were not earning any income. In 2010 and 2011, personnel cost for the steel plant constituted the total budget for the plant: N2.3billion ($11.5 million) and N4.5billion ($22.5 million) respectively.

References 6 and 7 in Chapter 1 contain the sources of the account in this chapter.

Abandoned and Still to Be Reactivated Scientific Projects

It was on 23 December 1988 that President Ibrahim Babangida laid the foundation stone of the Sheda Science and Technology Complex (SHESTCO) at Kilometre 32, Lokoja-Abuja Road, Abuja. This was following the acceptance by the government of the recommendations of a 17-member panel of professors, doctors and technocrats who had carried out their study and deliberations for eight months. The complex was supposed to be the first-ever nuclear technology centre in Africa and to be modelled after the Tsukuba Science City in Japan, Taedok Science Town in South Korea and Serpong facility in Indonesia. It was successfully erected, and after five years, the Biotechnology, Chemistry and Physics laboratories were built.

There are four large laboratories at SHESTCO. They are the Biotechnology, Physics and Chemistry Laboratories which are in operations. The Nuclear Laboratory, which is the fourth laboratory, has not been in operation yet. Its constituent units are described in the next paragraphs, and are as follows:

  • 1. A radioactive waste management facility
  • 2. A nuclear instrumentation laboratory
  • 3. Recreational and educational facility
  • 4. A warehouse
  • 5. An irradiation facility
  • 1. A radioactive waste management facility

In 2009, at Nigeria’s Nuclear Technology Centre (NTC), the construction of low/medium radioactive waste management facility was reportedly awarded at the contract sum of N401.4 million to Commerce General Limited. It was stated that at the time of writing in 2018 that, so far, N312 million had been paid to the contractor, as explained by the Nigeria Atomic Energy Commission (NAEC), the supposed operators of the equipment. The project, according to the NAEC, should be 78% complete. They explained that the delays were caused by “inadequate funding of capital projects generally over the years, modification of the original design, as recommended by IAEA experts, which has resulted into changes in the BOQ (bill of quantities) figures and this development is being discussed with the contractor,” and also, there was “no outstanding Interim Payment Certificate on the project.”

A staff member of the NTC, who had knowledge about the contract and execution since 2009, alleged corruption. He claimed that the project had been used to embezzle money from the government since the time it was awarded. He said: “It is true that they changed the plan of the plant, but they’ve never done anything meaningful there since they mounted these blocks. The contractor is not qualified and along the line, he got stuck in the project and we’ve not seen or heard about him for many years now.”

According to Premium Times who reported this investigation, their efforts to reach the management of Commerce General Nigeria Limited, the contractors, were unsuccessful as the company had no website or any visible record. Its recorded address at Plot 3, Railway Avenue, Kachia Road, Kakuri, Kaduna South, Kaduna, did not exist.

While the commission stated the project was 78% complete, reporters claimed that a visit to the facility presented a different picture as it showed an expanse of land overgrown with weeds and construction work not halfcompleted. This did not justify the commission’s claim of paying almost 80% of the total contract sum to the contractor. If the contract was awarded at N401.4 million ($4 million) and N312 million ($3-12 million) had been paid so far, the balance should be about N89 million but the NAEC claims that it is N329 million (about $3-29 million).

2. Abandoned nuclear instrumentation laboratory

The project for the nuclear instrumentation laboratory, which is supposed to serve as a workshop for students, researchers and others in the nuclear field, was awarded at the cost of N829-6 million (about $8,296 million) to Trois Associate Limited in 2012. It was 68% completed as the NAEC stated in a Freedom of Information request. Again, the NAEC claimed that the project was not abandoned and was delayed due to the lack of funds. “For instance, there was no provision for the project in year 2016 and only about 11% of the capital has been released so far in the current year (2017),” the response noted.

When the Premium Times representative first visited the centre in September 2017, there was no contractor on site. In fact, they reported that there was no physical way a contractor could have reached the building because there were about 100 metres of bushes and trees surrounding the laboratory building that needed to be cleared.

“The contract has been on hold due to non-payment of funds,” the contractor[2] handling the project, told the Premium Times when contacted in October 2017.

“We demobilised in 2015 March because our outstanding valuation was not honoured by the commission. It was due payment that was just made last month.” He said the project was about 75% completed as against the 68% quoted by the NAEC and that he was already on site after a recent release of fund. He would not state the amount recently released. Although the project was awarded at an agreed amount of N829-6 million (about $8.296 million), the N265-2 million (about $2.652 million) balance will not be a sufficient fund to complete the construction.

3. A recreational and educational facility

A professor1" and the then Minister of Science and Technology, while receiving former military leader, Ibrahim Babangida, at the foundation laying ceremony of the nuclear facility in 1988, envisaged that the centre should be a “sanctuary to the scientific and technological community where members can retire to occasionally for more positive thinking about the physical.”

To make that vision a reality, the Goodluck Jonathan government in 2012 made budgetary provision for the construction of a recreational and educational facility. At the time of writing, it was still abandoned, and the site was cultivated by farmers in 2018. The contract was awarded to Silhouettes AB + Turnkey at N274.5 million (about $2.74 million) and an initial payment of N214.2 million (about $2.142 million) was made, leaving a balance of N60.3 million (about $0.63 million).

Like others, construction of the sports facility was half completed and the NAEC said it was delayed due to a lack of funds. “The contractor has just been mobilised back to the site and further works on the project have commenced,” the NAEC explained.

Meanwhile, staff of the NTC said they were familiar with the management’s “deceptive” move of mobilising contractors back to the site whenever they sniffed a probe. “It’s a game and they understand the game very well. They mobilised the same contractors back to site immediately the present administration came on board in anticipation of what may come up but since there were no signs of probe everything ended that way,” a staff said. The staff added that the “fire brigade approach” of mobilising contractors back to the site was only to douse the tension raised by this investigation by the Premium Times reporter. “They will soon abandon the project again when everything dies down,” she said.

The contractor[2] handling the project declined to speak with Premium Times without permission from the NAEC. “Speak to NAEC and let them tell me to speak to you,” he said in a phone conversation. He became agitated when reminded that the project was being funded with public money and, as such, he had a duty to answer questions relating to it.

“I’m a private man, I’m not a public man,” he said angrily and hung up. It was alleged that his reluctance to speak about the project might not be unconnected with the state of the sports centre which had been turned into a farm and grazing field for farmers and cattle herders. Contrary to the claim that contractors had been mobilised, in December 2017, when the Premium Times reporter visited in January 2018, the site was still abandoned just as it was in previous visits. The only visible change was two heaps of sand delivered at the site. There was no one working there.

4. Completed - but locked - warehouse

One of the reportedly completed projects at the centre, the warehouse, had been locked since 2009 when it was completed, Premium Times learnt. According to the findings, the facility was supposed to be a warehouse for people to bring in their produce for irradiation and store the same before transporting it out of the centre. However, it was reported that none of these activities had ever happened at the centre.

“There was a time, it was thought that the Irradiation Facility could be commercialised,” said the Director-General1- of SHETSCO. The need for a warehouse for storing goods for irradiation was identified.

It was claimed that just before they (NAEC) left the Ministry of Science and Technology to the Presidency, someone went to the President and suggested that the facility could be commercialised. The President directed the then Minister of Science and Technology to look into the possibility.

In compliance to the directive, the Minister then set up a committee and part of the recommendation of that committee was that it could be commercialised, but in the first place, a warehouse should be built. Before the report of that committee could be fully implemented, the management of the centre had gone to NAEC and NAEC had left the Ministry. However, the commercialisation has not been followed up.

5. Irradiation facility

This is one of the major facilities in the NTC. It contains a 340-kilocu-rie cobalt-60 irradiation source. It was inaugurated by President Obasanjo shortly before leaving office. It cost over N50 billion (about $0.5 billion) and was built for research and commercial operations, but its operation was suspect, as it had been poorly maintained since 2006.

Planned uses and applications: It was planned to be used for the peaceful application of nuclear technology in areas of agriculture, industry, health care, polymerisation, electricity generation, sterilisation, disinfection and autoradiography. Intended applications in agriculture include increased food production through the use of fast neutrons to induce mutations in seeds, sprout inhibition of onions, potatoes etc., insect disinfestations of grains, reduction in microbial load of spices, genetic engineering and breeding disease resistant plant varieties.

In addition, with a controlled injection of gamma radiation, the shelf life of perishable agricultural produce such as yam, cassava, tomatoes, beans, oranges etc. could be prolonged thereby reducing loss in the harvested foodstuffs. The potential beneficiaries are researchers, farmers, exporters and medical practitioners. Despite these huge economic potential applications, the facility was not being used because it failed to work properly.

"The facility there is already old,” said the Director-General.

We bring products in, irradiate them and take them out from the other side. But funds have not been forthcoming for us to do that the way we wanted. Since 2015, we have not seen any capital expenditure. So, this is the hard reality.

He said the facility could not irradiate up to a tonne of produce in its present condition. A nuclear technology expert and former Director[4] of SHETSCO noted that the facility could still be used for commercial purposes but needed to be upgraded for maximum output. He explained:

The cobalt-60 that is being used there has a half-life of about five (years). So, every five years, it deteriorates by half. It means that by 2015, it had gone down to a quarter of what it used to be. By the safety principles of International Atomic Energy Agency, IAEA, it was no longer a safe nuclear centre. Nigeria has been a member of the IAEA; we should therefore know that we are not complying by their safety standards.

He observed that the most harmful consequences arising from facilities and activities should come from the loss of control over a nuclear reactor core, nuclear chain reaction, radioactive source or other source of radiation. Consequently, to ensure that the likelihood of an accident having harmful consequences is extremely low, measures have to be taken to prevent the occurrence of failures or abnormal conditions (including breaches of security) that could lead to such a loss of control.

Investigation by Premium Times had shown that most of these breaches would have been avoided had the contracts awarded been fully executed. The mismanagement of the irradiation facility, the non-existence of a waste management facility for proper disposal of nuclear wastes and others abandoned within the centre probably should necessitate the decommissioning of the nuclear facilities.

Lack of progress: A contributory factor to this is poor decision making. As discussed earlier, the government was yet to decide on who managed the NTC and its facilities: the Ministry of Science and Technology or the Presidency. SHETSCO was under the ministry but the NTC and its facilities had been transferred to the presidency.

“Before, this centre used to be under the management of SHETSCO and things still work well, but when they transferred the management to NAEC in the Presidency, everything got destabilised.” This was the testimony of one of the workers. When it was inaugurated in 2006, the Gamma facility was managed by SHETSCO who was in control of the whole complex. Three years later, in 2009, the management was transferred to the NAEC and thus, the facility and others at the NTC including the staff became the responsibility of the NAEC.

“The centre is under NAEC and NAEC receives the budget for the centre,” Deputy Director,[4] Budget, Ministry of Science and Technology told Premium

Times during a follow-up to a Freedom of Information (FOI) request for the budget of the centre.

“SHETSCO is under the ministry and their budget is quoted in the ministry’s budget. But the budget of the Nuclear Technology Centre goes directly to NAEC which is under the presidency. So, we don’t have their budget here.”

As reported by Premium Times, investigations revealed that the NAEC is culpable in the poor management of the Gamma facility. According to the arrangement, when the NAEC was to take over, nuclear activities at the centre including the maintenance of the Gamma facility fell under the control of the NAEC while the non-nuclear ones remained the responsibility of SHETSCO.

“Since 2009, the budget goes into NAEC,” SHETSCO Director-General[2] said. Investigation by the Premium Times reveals that the budgetary provision for the centre to the NAEC is about N13 billion ($0.13 billion) for personnel, recurrent and capital expenditure for the commission in the past five years.

Inadequate funding: As already reported, the chairman^ of the NAEC defended the commission, saying it was hampered by inadequate funding. While admitting that the facility was not properly maintained, he explained:

There is nothing like NTC budget fundamentally, what we do (is that) government funds projects and they allocate funds (to) the project. On the recurrent, even under SHETSCO, the NTC never had a separate budget, it was SHETSCO budget. Somehow, we have a one-line budget without specifying which centre has what.

For instance, our overhead cost (received) in the last two, three years is less than N12 million ($0.12 million) monthly, for all the headquarters and all these centres, you have to manage it. Last year we had an overhead of only 8 months, this year we have had only six months. So, there is no magic we can do.

Why Was the Centre Not Completed?

The reasons, which were the causes of failure, include the following:

Ill-Defined Responsibilities for Management of the NTC

The Nuclear Technology Centre (NTC) was initially a unit in Sheda Science and Technology Complex (SHETSCO), which was in the Ministry of Science and Technology until 2009- It was then transferred to the Nigeria Atomic Energy Commission (NAEC), which was a department in the presidency. However, this transfer had not been fully implemented and this contributed to the failures in the management of the operations of some of the units of NTC such as the Nuclear Instrumentation Laboratory and others.

Idleness at Work, Zero Productivity

There had been a drastic non-availability of tools to work with, such that some staff of the centre informed the reporting investigator that they came to work daily to do nothing as the machines were no longer working. One of them explained that the situation was better when the centre was run solely by SHETSCO. She said:

It’s not only about salary but I also have to think about my career. Even though my salary is being paid regularly but I’ve not been doing anything for years now. Nothing is working here, and we can’t continue to keep quiet. We come here every day just to talk and while away time. Nothing is functioning here.

Another staff said that he was unhappy at being idle and urged the government to merge the nuclear centres into one entity. He explained:

It’s better that the place is left to be managed by one entity. If there is any fault now, you will see that there will be shift of blame. So, let everything that happens here be on one person. We don’t want SHETSO, NAEC joint management again. We want just one. We want to work.

Fund Limitation

The Chairman[4] of NAEC explained:

If you’ve not been able to secure funds, irrespective of who is managing it, you will not be able to do anything. For instance, if a facility develops some fault and to fix that somebody gives you about €800 bill, you have to plan that in the budget before you could get it repaired. But what we have challenged our staff to do is that there are some of those things they can work on themselves. So, it’s not a question of people go there and no work, but the challenges of fund and we are working to get appropriate funding. With the support we are gradually getting from the government, we are likely going to solve some of those problems within the next year.

Going Forward: Road Map

The Federal Government in August 2017 approved a 13-year National Science, Technology and Innovation Road Map, starting from 2017 to 2030. The minister of Science and Technology, in 2018, stated at the presentation of the South-West Sensitization Programme on National Science, Technology and Innovation Roadmap, that the roadmap should save the country about $11 billion in five years. He said the roadmap should enhance the nation’s emerging post-crude oil economy, catalyse economic growth and boost competitiveness of the nation’s raw material endowment.

A former Director-GeneraF of the nuclear centre said: “It is unfortunate that we keep talking about nuclear programme, but the government is not spending on this.” He continued:

Any programme that will gulp money, the government can propagate it but later turn their eye to it and nuclear technology is always expensive to run. They need to put more money. For example, nuclear technology can be used in power generation. We can ask our friends in other parts of the world to come and invest in nuclear technology but first, we must put our money down. It is business. We can get up to 5,000 megawatts from a nuclear source in the next five years if we take deliberate steps. We can target.

In the meantime, the centre remained abandoned and was in urgent need of reactivation.

Observations and Comments

While workers accuse their management of corruption and mismanagement of funds, the management responded that it was a case of inadequate fund for their operations. Moreover, no fund was specifically allocated for running any facility

The failure to complete the infrastructure of these strategic scientific facilities could be attributed to poor project management and failure of subsequent governments to provide adequate resources. It appeared that the individual users were left to manage them, and the accountability had been poor.

Setting up such strategic and expensive projects without any reliable central project management team to supervise gave way to abuse and allegations of corruption, mismanagement of funds and failures. The vision and objectives became lost in the morass of everyday commonplace mismanagement of fund that is a feature of government projects in Africa. A former country’s vice president[8] had said a project belonging to everybody belongs to nobody. This statement seems to be borne out by the corruption and mismanagement of public fund observed in these projects. The sad accounts of the huge losses sustained in the uncompleted and practically abandoned facilities after much money had been sunk into their projects greatly underscore the need for a national project management unit that should be responsible for such major strategic projects to prevent such unbridled waste and continuing drain of scarce national resources.

Nigeria Is the Largest Importer of Petrol Because of Non-Functional Refineries [1]

Speaking on 1 March 2018, Group Managing Director (GMD)r of the Nigerian National Petroleum Corporation (NNPC) stated that Nigeria was the only member country in the Organisation of Petroleum Exporting Countries (OPEC) that imported petrol, that is Premium Motor Spirit (PMS), and was currently the largest importer in the world. The GMD was represented by the Chief Operating Officer (COO),f Upstream, who made this statement at the 2018 Oloibiri Lecture Series. He described as “shameful” the situation where Nigeria, Africa’s top oil producer, depended on petrol imports to meet daily needs.

Causes of the failure: In this period which included 2018, Nigeria had four refineries located in Port Harcourt (two), Warri and Kaduna, with combined installed capacity to refine 445,000 barrels of crude per day but these had not been working properly for years. This was allegedly because top oil industry officials and politicians reportedly diverted huge funds earmarked for their routine comprehensive turnaround maintenance. It was feared that the four refineries had not undergone comprehensive repairs in a decade or more as contracts awarded for their repairs were either abandoned halfway or not executed at all.

Comments

It is instructive that it was the Group Managing Director of NNPC who described as shameful our failure to refine our crude locally to produce our own petrol requirements. This statement is suggestive and probably indicative of the fact that he did not find himself or his corporation liable for the failure. On the face of it, one would think that it was their responsibility, but he appeared to disown it. Invariably, the Federal Government appeared to be implicated.

A message one could take away from this event is the possibility that the Federal Government had not given them a free hand to operate and discharge their responsibilities as best as they would want to do.

Little or No Accountability and “White Elephant Projects” [2]

It had been the practice for many years, especially since after the Nigerian Civil War, from 1971 to 2019 - the timing of the writing of this book - that state governors, federal ministers, whether military or civilian, etc., had managed their ministries, and projects with little or no accountability. Each managed their areas of responsibilities as their personal estates. A Bureau of Public Procurement was established in 2007 but it is doubtful how much control that this organisation has exerted, over the years, on the heads of the Nigerian federal and state government - these are the presidents, governors and ministers, in their engagement in projects on behalf of the country with foreign companies. Nigerian governors and presidents, at the time of writing and for some years before, had immunity from prosecution while in office. However, directly they completed their terms of office, many of them faced investigation and prosecution for mismanagement of fund and money laundering. This happened especially to persons whose party was no longer in power. They were sadly covered if their party was still in charge of the Federal Government. Some of these projects have resulted in white elephant projects; these are discussed in the next paragraphs. A white elephant project is one which is expensive to maintain or difficult to dispose of because the cost of making, keeping or maintaining it is far higher than its usefulness or value.

Questionable and “White Elephant” Projects in Nigeria [2] and Other African Countries

It had been said that public office holders who embarked on such white elephant projects were motivated by the desire to impress the public in the knowledge that most Nigerians hardly bothered to explore the economic justification of government projects. Moreover, such projects, whose costs were allegedly often inflated, provided avenues through which public funds were reportedly “siphoned” or secreted away.

An example was that some 100 students, from Kano State, were sent in March 2013 to undergo an 18-month professional pilot training course at the Mid-East Aviation Academy, Amman, Jordan, at the cost of $6.7 million [3]. A report in the Daily Trust (newspaper) of 1 March 2016 referred to the Daily Trust on Sunday the week before that 100 promising young men and women that were sent abroad by a state government to undergo training as commercial pilots ended up as civil servants and classroom teachers on their return. An investigation in February 2016 by the Daily Trust, found that there were already about 600 qualified but unemployed pilots in the country. It also reported that about 80 of them had come back to the country following their graduation; however, some of them had been employed by the state government as regular civil servants, some of whom were classroom teachers.

In the same vein, a former state governor also sponsored some 25 students from Kano state for a 4-year course in Marine Engineering in the United States and India at a staggering cost of $80 million per annum, (i.e. $320 million for the 4 years) according to the Director of Press to Governor.

Kano is a geographically landlocked state in Northern Nigeria, there are no rivers or boats and ships to provide suitable job opportunities for the students when they graduate.

Causes of Failure

Failure to have carried out appropriate feasibility studies before embarking on these “white elephant” projects accounts for their failure. These examples highlight and demonstrate the poor accountability and absence of supervision to justify investments on such projects. Therefore, poor governance, poor accountability and control and questionable use of public funds, which engender corruption, are some of the reasons for the existence of failed projects in the form of “white elephant” projects which are hardly any good to the public.

Failure to Plan for Sustainability of Projects and Project Deliverables

The effect of failure to plan for sustainability of projects and project deliverables is discussed in the next paragraph as it is one of the factors that turned Nigeria into a leading nation in failed projects.

Various Nigerian governments over the years have imported modern equipment and facilities into our country which has a developing economy with a comparatively poor and underdeveloped intrinsic industrial base. In the past 60 or more years, projects of the then ultra-modern power stations and steel plants, among other industrial facilities, had been implemented, commissioned and put into operations.

Following the failure of parts which could not be procured, especially plant electronics, control and automation systems and equipment, it became impossible to keep some production and ancillary plants in operation. This contributed to the abandonment of many commissioned industrial plants just three to four years after being commissioned into operation.

Personal Experience: Failure of Delta Steel Company

It is counterproductive, ill-advised and indeed a questionable use of national resources for a nation to keep importing equipment without any guarantee of their long-term sustainability. This writer finds this project procurement practice reprehensible because of the bad experiences which he personally had in working on projects in our Federal Government owned companies. As the Head of Control, Instrumentation and Computer Systems Department, he had the responsibility for engineering management of automation systems in the Delta Steel Company Limited, Aladja, Warri, Nigeria. Therefore, he had a first-hand experience of the problems created when projects that cannot be sustained and supported through their planned lifetime are imported and implemented in the country. They fail in a few years and become abandoned. The costly and magnificent Delta Steel Complex, which was reportedly built at a cost of $1.2 billion, had been abandoned because of the unsustainable costs of keeping it in operation.

In this case, it was not just maintenance costs but also poor and inadequate generation of income. As we read in the earlier sections, the federal government was constrained to privatise it and it did not fare any better with the new managers. It was abandoned for years before being acquired by new owners who are trying to restore it to production at this time of writing in 2018 and 2019-

Absence of Project Management Office: International Practice for National Project Management and Sustainability

In some developed countries, there are national and government project management offices and agencies staffed with appropriate professionals with expertise in various technical specialities who have responsibilities for both short and long-term national projects. Such professionals participate in project negotiation. They also plan for the long-term sustainability of major projects in the nation. In the UK for example, there is the Infrastructure and Projects Authority (IPA). Statistics given which show information on the performance of respective national project management in Nigeria and the UK hardly bear any close comparison. In our case, losses running into billions of Naira from abandoned projects are discussed. While in the UK, 60% success is being estimated for the 2016-2017 period. Our statistics for this period may or may not exist. It is in our interest that we learn from the UK and other developed countries how they plan, invest and operate their programmes and portfolios of projects successfully.

Going Forward

Necessity for a Nigerian National Project Management Office

The UK Infrastructure and Projects Authority (IPA) is described as a unit which “works across government to support the successful delivery of all types of infrastructure and major projects; ranging from railways, schools, hospitals and housing, to IT, defence, and major transformation programmes.”

This underscores the fact that, for success and sustainability of projects, we need professionals with expertise in relevant technical specialities. The way forward should be to establish them as a unit, a National Project Management Office (NPMO), charged with the responsibility of end-to-end project management in the country. The National Assembly should empower the NPMO to participate with government departments and ministries in discussion and investments in future major projects. No ministry should procure projects for the country independently. It has been shown in this book with the example on “white elephant projects” that the Nigerian Bureau of Public Procurement, the regulatory authority responsible for the monitoring and oversight of public procurement, had hardly any control on major project procurements in the country by state governors and federal ministers.

Questions

  • 1. Why did the steel companies fail?
  • 2. Do you know of other companies which depend on government funding for their operations? Can you dispassionately discuss their performance?
  • 3. Can you cite instances in the chapter where work was delayed because of no funding from the government?
  • 4. These clearly demonstrate that complete dependence on the government should not be encouraged. Each organisation should earn an income for its operations. How can these be achieved?
  • 5. Please note that the failures presented in this section involved all the parties whether public or private sector workers. Should you encourage such an arrangement? Do you know of any such companies which have failed or are operating successfully?
  • - What is a “white elephant” project?
  • - Why could it occur in a country?
  • - What could be the necessities of a national project management unit?
  • - Are there any failures in project delivery in your country which could have been checked and stopped by a national project management unit?

References

  • 1. “Outrageous lies about Nigeria’s refineries” Posted by: mms plus in NEWS LENS, OIL & GAS 3 July 2018, https://mmsplusng.com/blog/outrageous-lies-ab out-n igerias-refi neries/
  • 2. Mohammad Qaddam Sidq Isa, “Nigeria: white elephant projects,” Daily Trust (Abuja), 25 February 2016.
  • 3. Joy Ogbebo, “Pilots now teachers in Kano,” Category: News, 1 March 16, Mamaj’s Aviation Blog; http://mamajsaviationblog.com/2016/03/4854/

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