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NEC mulls reversal of power privatisation

...Says FG spends N1.7trillion to subsidise power in 3 years

 

Ahead of the planned submission of reports on power sector reforms, the National Economic Council, NEC Thursday dropped hints to back the reversal of the 2014 power privatization by the administration of former President Goodluck Jonathan.

This is part of the recommendations being proposed by the Governor Nasir el- Rufai-led committee inaugurated last year by the National Economic Council, NEC as part of efforts to ensure stable power supplies.

This is one of the recommendations we are putting forward, but we know that it has implications,”

El- Rufai said while briefing State House Correspondents after the monthly NEC meeting presided over by Vice President Yemi Osinbajo,. He lamented that “Electricity supply in the country industry is broken down completely”.

“The problems are many; the entire sector is broken, there is a fundamental structural problem. Government has supported the industry with N1.7trillion in the past three years. Government will take some very tough decisions. There is a lot of blame game. Over 80million Nigerians are without electricity.

“It is either we continue to allow the federal government pump in N1.7trillion every three years, or we take the tough decision that will ensure a stable power supply,” he said.

Blaming the problems of electricity on capacity, El- Rufai said the sector players have shown lack of capacity.

“The entire sector is broken, the tariff is an issue, the way the privatization was done is an issue to many. So there are many issues. What we have agreed on is that there are fundamental problems in the electronic supply industry. And that you cannot privatize an industry and then over three years since privatization, you pump in N1.7 trillion of government into it. That is not privatization.

He insisted that the solutions must be found to the problem , warning that those solutions are not going to be nice. “They may be painful,but the only way to solve the structural problems in the industry is to take some very difficult decisions,” he said.

El- Ruai disclosed that the Council has granted the committee the powers to engage Nigerians, adding that the Committee will carry out public hearings, call for memoranda from members of the public on the way to go before sending its recommendations

“Right now we are listening to all the stakeholders; of course there is a lot of blame game. At the end of the day, we must have an honest conversation as Nigerians

“How do we fix the structural problem in the industry so that it doesn’t cost the government this much to cover the whole of the country?” he queried.

“Today, there are 80 million Nigerians that do not have access to electricity. We cannot continue like this.”

He also announced that NEC would soon forward a proposal that will see federal government free 20% of the over N10trillion accumulated pension funds for infrastructure development.

The proposal, if approved, will see the money given as loans to the private sector for the development of three critical areas of roads, rail and power infrastructure

The money is to be given on a long-term basis will attract between 5% and 6% interest over a period of 30 years and will be recovered through allocation of right of ways on the roads to be used, and the land to develop properties. He said that coupon rates of 5% to 6% are being targeted, he said.

 

 

 

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