Worries over the Manitoba deal

Manitoba Hydro International of Canada is one of the successful bidders in the privatization exercise but every stage of the power deal signed with the company, from the bidding process through contract agreements to the take-over of the management of the Transmission Company of Nigeria (TCN), has suffered the consequences of conflict of interest.In March […]

Manitoba Hydro International of Canada is one of the successful bidders in the privatization exercise but every stage of the power deal signed with the company, from the bidding process through contract agreements to the take-over of the management of the Transmission Company of Nigeria (TCN), has suffered the consequences of conflict of interest.
In March 2013, the Federal Government signed a N3.85 billion contract with Manitoba for the management of the TCN for a period of three years. TCN is the Federal Government company which owns Nigeria’s electricity transmission network. It is one of the successor companies of the unbundled PHCN. Manitoba was contracted to take over TCN’s functions as transmission services provider, system operator and market operator. Media reports indicate that ever since the three-year contract was signed, some of the terms of agreement in the contract have been ignored by both the ministry of power and Manitoba. The exercise of control over funds is one grey area where the country’s interest seems to have been compromised.
Reports suggest that the Minister of Power Chinedu Nebo had instructed the handing over of TCN accounts to four officials of Manitoba, even though contract documents specify that TCN accounts signatories shall comprise of two Manitoba staff and two Nigerian counterparts. And even as Manitoba assumed control of TCN and day-to-day running of the company, such has failed to translate into better electricity transmission so far. In fact the opposite seems to be the case with at least three system failures since the take-over.
Furthermore, the contract documents stipulate that all payments to Manitoba should be approved by the board. Reports, however, indicate that Manitoba has so far received about 49 per cent of the contract sum without the board’s approval. The obstacles encountered by the TCN board in the execution of its statutory functions are even more apparent from the tone of operational relationship that exists between the TCN Board Chairman Hamman Tukur and Power Minister Chinedu Nebo. Such could only be described as a regrettable consequence of inefficiency on the part of the presidency which appointed both Tukur and Nebo. While the Secretary to the Government of the Federation Anyim Pius Anyim  on 20 December 2012 named one set of nine board members, the minister on 12 March 2013 inaugurated a separate set of seven members into the board. Although both boards are chaired by Tukur, the Nebo-appointed set included Manitoba CEO and excluded “essential” members including a representative of the Manufacturers’ Association of Nigeria (MAN). It naturally defies logic for a contractor to be part of the board that supervises his work.
The expansion of the TCN board by Chinedu Nebo as well as his wrongful directive to concede the four signatories of the TCN bank account to Manitoba only gives credence to the insinuation that authorities are not keen on going by the spirit and letter of the agreement which underpins the management contract with Manitoba. The failure by President Goodluck Jonathan to resolve the membership crisis in the TCN board by reconstituting it two months after his pledge equally suggests that even the presidency may not be immune to the machinations of the powerful interests involved in the power sector and whose interest may not be improved electricity delivery to Nigerians. It is evident from the back-and-forth intrigues that bedevilled the Manitoba contract from the on-set and the current operational crisis that some interests do not want the power deal to succeed. TCN senior staff as well as authorities at the ministry of power may not completely be innocent of this allegation. It is unfortunate that contract agreements of this nature always tend to get into unnecessary deadlock.
In order to avoid such contrivance, all parties to the Manitoba contract must be made to honour the terms agreed upon. The minister of power should desist from interfering in the functions of the board as well as in the operational duties of the contractor in the management of the TCN. The presidency should hasten to resolve the membership crisis of the TCN board. Allowing the problem to fester is not in the interest of achieving improved power supply to Nigerians. Power is crucial to national development. If we fail to get it right, we will also fail to get other things right. We expect the authorities to learn from the contrived stalemate in the case of NITEL which has degraded its value and rendered it almost irrelevant in the telecommunications industry in Nigeria today.