The Minister of Works, David Umahi, has denied rumors in the media that the Federal Executive Council (FEC) stepped down and inherited road projects.
During a meeting with contractors in Abuja, Umahi disclosed that such information was misleading, adding that neither President Bola Tinubu nor the FEC issued the direction.
He said that the ministry was only directed by the president to review all projects in the country to decide those that would be given priority based on availability of funds.
According to Umahi,” Some of these projects were awarded eighteen years ago, some ten years ago, and others five years ago,”
“With regards to new projects, we will not proceed with an appropriation if it has not been completed by at least one kilometer.
That’s the thing that worries the FEC. We cannot have a budget of N500 million, but procurement should be N50 billion or N100 billion, and you are awarding such a project. We’ve been told not to do that.
Umahi reaffirmed the Federal Government’s commitment to provide financing and innovative budgeting techniques that would expedite the building of road infrastructure across the country.
According to him, the Ministry of Works was instructed by the FEC to collaborate with the Federal Ministries of Finance, Budget, and National Planning in order to provide accurate budgetary forecasts.
This ,he said ,was for the 2025 financial year for projects that were not appropriately budgeted for but have attained probably 80 per cent completion so that such projects would be completed and delivered.
He however, said that projects with huge procurement costs with little appropriation and with little completion milestones would be reviewed in line with section 51 of the Special Conditions of Contracts.
“On issues of Variation on Price (VOP),all projects we awarded in 2024 will not attract any VOP.
“We have made it as a policy that such projects can not get any variation
“However ,within the course of the year and the project execution, if there are issues changing the basic market prices of construction materials to a certain extent, we will revisit the issue of VOP and it will not be selective,” Umahi said.
The minister assured contractors of the Federal Government’s willingness to engage in contract review and cost augmentation on the inherited ongoing projects.
This is in view of the geometric rise in cost of contract elements caused by the inherited challenging economy.
