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Faced with fund paucity FG turns to private sector to fix roads

By Anthony Isaac

The Federal Government has turned to the private sector to fund road development and repairs, as it battles dwindling revenue to finance key infrastructure.

The Minister of Works and Housing Minister, Babatunde Raji Fashola (SAN) who unveiled government’s plan to keep Federal Highways in top shape, said 10 of them would be concessioned.

Fashola disclosed this in his presentation on Public Private Partnership (PPP) on Highway Development and Management Initiative to the joint National Assembly Committee on Works.

A statement by the Ministry’s Director, Press, Boade Akinola, explained that private sector engagement in the development and management of roads is an avenue to mitigate paucity of funds which has hindered road development in the past.

The Minister stated that the Highway Development and Management Initiative (HDMI) was created by his Ministry to manage and develop the federal road networks, with the objective to attract sustainable investment and funding in the development of road infrastructure and to maximize the use of assets along the right of way.

According to him, “The rationale behind the private sector engagement under the HDMI would provide an avenue that would mitigate paucity of funds, which had hindered roads development in the past”.

He listed the 10 roads be concessioned under the first phase of the HDM initiative as: Benin – Asaba, Abuja – Lokoja, Kaduna – Kano, Onitsha – Owerri – Aba, Shagamu -Benin, Abuja -Keffi – Akwanga, Kano – Maiduguri, Lokoja – Benin, Enugu-Port Harcourt, Ilorin-Jebba.

The total length of the federal road network is 35,000km, but the proposed project in the first phase will cover a total length of 2,275km.

The project will attract a capital investment of N163.323bn at a cost of about N16bn per each of the 10 roads, in addition to about 23,322 jobs that would be created.

Explaining further, the Minister said investors are expected to provide streetlights, toll plazas, rest areas, and weighbridge stations.

The HDMI, he explained, was broken into two categories, namely: Value Added Concession (VAC) and unbundled Assets Approval (VAA).

He added that the Federal Ministry of Works and Housing, Infrastructure Concession Regulatory Commission,(ICRC), Bureau of Public Procurement (BPP) and Special Purpose Vehicle Concessionaire were the defined stakeholders to provide the regulatory framework in the implementation.

Earlier, Senator Adamu Aliero, Chairman Senate Committee on Works who co -chaired the Joint Session with Rep. Buba Abubakar, Chairman House Committee on works, stated that it was imperative to engage private sector partnership to tackle the bad roads in Nigeria as government alone could not bear the burden of fixing them.

He said the Public Private partnership reduces the financial burden of government thereby allowing funds to be utilized in other relevant social economic sectors.

Present at the presentation were the Minster of State for Works and Housing, Engr. Abubakar Aliyu, the Permanent Secretary, Mohammed Bukar, some Directors of the Ministry, and the Director General/CEO of Infraustructural Concession Regulatory Commission, Engr. Chidi Izuwah and some other stakehokders.

Written by ExpressDay

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