The Senate Public Accounts Committee has sustained the query issued to the Federal Mortgage Bank of Nigeria by the Auditor General for the Federation.
The bank was accused of paying N14bn as against the approved N10bn to the contractor handling the construction of 963 units of residential building known as Legacy Estate, despite the fact that the project was allegedly not executed.
The Chairman of SPAC, Senator Mathew Urhoghide, took the decision at the last sitting of the panel last week when it considered the 2018 report of the Auditor General for the Federation.
Both chambers of the National Assembly are currently scrutinising the 2015 to 2018 reports of the AuGF with a view to taking necessary legislative actions on them.
The AuGF in its 2018 report, explained that the contract for the Legacy Estate was awarded at a cost of N10bn.
The document, however, explained that a total of N14.2bn was disbursed to the contractor between 22nd November 2012 and 29th April 2013.
The Managing Director of the FMBN, Ahmed Dangiwa, had, however, explained that his management was making moves to contact the previous management under which the contract was awarded for further briefings.
Dangiwa said, “The contract was conceptualised in 2012 by the previous management. The present management, in its efforts to recover the bank’s asset expended on the project, engaged all stakeholders.
“This management, also initiated a valuation of the development on site to be carried out by external consultant and the total works done on the site, comprising housing units and infrastructure work valued at N940 million.”
The auditor-general in his query had said, “Audit observed that the bank awarded a contract for the construction of 963 units of residential building called Legacy Estate, with all the facilities and services of a modern urban setting at a contract price of N10,000,000,000.00.
“However, a total of N 14,281,749,370.71 was disbursed to the contractor between 22nd November 2012 and 29th April 2013, thereby resulting in an overpayment of N 4,281,749,370.71.
“No reason was provided for the additional payment; neither was any evidence of contract variation presented for audit.”
It said there was no justification for the overpayment.