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Reps Probe NSIA over Auditor General Report on the Management of Resources for Affordable Housing

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The House of Rep Committee on Public Accounts has summoned the Managing Director of Nigeria Sovereign Investment Authority (NSIA) and heads of 11 affiliate companies over the management of public resources for the provision of affordable/social homes for low-income earners in Nigeria.

The invitation was sent to NSIA via a letter with Reference No: HR/PAC/SCOS/9NASS/QUE.64/56 dated 30th November 2022 and signed by the Chairman of the Committee, Hon Busayo Oluwole Oke

According to Hon Oke, the purpose of the fresh invitation was to revisit the Auditor General of the Federation’s Annual Report on the management of resources for the provision of affordable/social homes in Nigeria by Family Homes Fund Limited.

The letter reads: “I refer to our letter Ref. No. HR/PAC/SCO5/9NASS/QUE.62/84 dated 18th November 2022 inviting you to appear before the Committee on Friday 25h November 2022 on the above subject matter. In view of the above, the Committee is in receipt of your correspondence with Ref. No. NSIA/NAS/HCPA/022/01 dated November 25, 2022, and resolved to request a soft copy and 15 hard copies of a written brief on each of the following subsidiaries and Investment Companies of NSIA to enable the Committee to carry out its Legislative mandate.

The 11 organizations summoned by the Committee are NSIA Motorways investment company; FGF Private Equity Co. Limited; FGF PE Beta Limited; FGF Investment Limited; NSIA Property Investment company Ltd; NSIA power investment company Ltd; NSIA Agriculture Investment company Ltd; LUTH Advanced Medical Service Ltd; FMCU Advanced Medical Diagnostic Ltd; AKTH Advanced Medical Diagnostic Limited and NSIA Healthcare Development and Investment Company Ltd.

Hon. Oluwole Oke said this in the letter “A new date has been fixed for your appearance. You are to cause an appearance before the Committee on Monday 12th December 2022 at 11:00 am,”

The Committee during the investigative hearing also requested relevant approvals from the Minister of Finance, Budget and National Planning, Dr. Zainab Ahmed authorizing NSIA to grant a loan of N1.5 billion to Family Homes on an interest-free basis.

According to the audit report, the total capital funding of Family Homes between 2018 and 2020 stands at N65 billion and was paid by the Federal Ministry of Finance, Budget and National Planning, representing 13 percent of the N500 billion seed capital promised by the Federal Government for provision of affordable homes for low-income earners in the country.

In the same vein, the sum of N1.500 billion was a take-off credit grant from Nigeria Sovereign Investment Authority (NSIA) in 2017.

The report further revealed that during project inspection visits in Delta, Kaduna, Kano, Nasarawa and Ogun states that FHFL proposed to build 3,289 legacy homes, but only 2,107 homes were completed, out of which only 675 homes were sold, representing 32% of the total completed as at 31st December 2020.

While noting that the company-awarded contract prices were higher than the capped cost limit, there were discrepancies in the cost of the houses.

According to the audit report, a total sum of N3,230,403,000 was generated internally by Family Homes from sales of homes, and income from investment, among others between 2017 and 2020. The internally generated incomes were ploughed back into the capital for the provision of more homes.

An audit review of the Project Status Report revealed that FHFL proposed to build 3,289 legacy homes in Delta, Kaduna, Kano, Nasarawa, and Ogun states between the years 2018 to 2020.

The Inspection team however observed that only 2,107 homes were completed as of 31st December 2020 and were sold instead of the 70% stated in section 3.1.4(1) of the FHFL Operational plan 2020. A total of 1,432 homes completed representing 68% remained unsold.

The audit further observed that out of N16,983,308,000 projected to be recouped from the completed homes, only N6,059,268,000 had so far been recouped, leaving the outstanding sum of N10,924,040,000 due to the company’s inability to sell the remaining 1,432 completed homes as at 31st December 2020.

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