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Tue, Sep 5, 2023 5:25 PM

Minister of FCT Queries Agreement for N85b Housing Project in Abuja

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Minister of FCT Queries Agreement for N85b Housing Project in Abuja
Minister of the Federal Capital Territory (FCT), Nyesom Wike, expresses disappointment and raises concerns over the agreement for an N85 billion affordable housing project in Abuja. He questions the lack of government benefit in the deal, where the private developers are set to make significant profits without the government receiving any proceeds. Wike suggests that the government should receive a 10 percent share, while the developers take 90 percent instead.

The Minister of the Federal Capital Territory (FCT), Nyesom Wike, has expressed disappointment and raised concerns over a major agreement entered into by government officials regarding the N85 billion affordable housing project in the Wasa area of the Abuja Municipal Area Council (AMAC) in the FCT.

During a recent tour of the project site in the Wasa community, Wike queried the lack of government benefit in the deal. He questioned the rationale behind the Federal Capital Development Authority (FCDA) providing infrastructure, while the private developers would build and sell affordable housing to the masses without any returns to the government.

Wike argued that it would have been reasonable for the government to receive a 10 percent share of the housing project's proceeds after providing significant funding, while the developers would retain the remaining 90 percent.

"Government provides land and infrastructure, then the private sector builds and makes money while the government makes nothing, who does that?

"This arrangement is not acceptable; the government can take, say, 10 percent, while the private sector takes 90 percent. The current rate is not affordable for the masses either.

"We will thoroughly review all these issues. We will not award contracts simply for the sake of it,"

The contract for the project was initially awarded in 2014 to Gilmor Construction Company at a cost of N28 billion and was later revised in 2018 to N85 billion. So far, N21 billion has been paid, with N64 billion outstanding.

After nine years, the project has only achieved 24.5 percent progress, much to the minister's disappointment. Wike expressed dissatisfaction with the contractor's delay in executing the project, especially after receiving an initial payment of N21 billion. He emphasized that going forward, contract awards and project completion will undergo careful evaluation to align with the financial realities at hand.

Furthermore, Wike raised concerns about the significant cost variation of the contract, which escalated from N21 billion to N85 billion. He also found fault with the projected market price of N8 million per housing unit upon completion, as initially estimated in 2014 when the contract was awarded.

The minister noted that the FCT administration can no longer continue with an arrangement where the government provides infrastructure for developers to earn substantial profits without contributing to the administration's coffers.

In addition to the housing project, Wike inspected nearby road projects around the Economic and Financial Crimes Commission (EFCC) national headquarters and the Office of the Benchers. These inspections aimed to identify and address any existing issues.

At the Kabusa junction during the Apo Gwarimpa road project inspection, Wike firmly stated that the administration would not permit the proliferation of shanties in the territory.

"We will not allow shanties to take over Abuja. The Development Control Department has done well. We will now protect the area so that miscreants will not return,"

Source of content: OOO News 2023-09-05 News

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