Auditor-general queries housing ministry over irregular award, execution of contracts

By Progress Godfrey, Abuja

The Office of the Auditor-General of the Federation (OAuGF) has raised concerns over financial mismanagement at the Federal Ministry of Housing and Urban Development, Abuja, citing irregular contract execution and unsubstantiated payments amounting to N4.44 billion.

The audit, contained in the 2022 Annual Report on Non-Compliance (Volume I) released recently, highlights weaknesses in internal control systems that could expose public funds to misappropriation and loss during the administration of the late former President Muhammadu Buhari.

The audit covers three key issues which were scrutinised: irregular execution of contracts with eight payments amounting to N1.78 billion, irregular award of contract and unsubstantiated payment for construction totalling N980 million, and payments for contracts without evidence of execution with 24 contracts worth N1.68 billion.

The report was accompanied by a formal transmission letter in which the Auditor-General informed the Clerk to the National Assembly of its submission in fulfilment of Section 85(2) and (4) of the Constitution. The letter highlighted that the documents cover detailed audit findings across federal institutions for the financial year ended 31 December 2022.

Findings show that several contracts were executed without specifying sites or beneficiaries, and certificates of completion did not indicate where work was carried out. Audit observations suggest a pattern of payments for services that may not have been executed. The Ministry’s responses were noted but deemed unsatisfactory in addressing the audit concerns.

The Auditor-General emphasised that these anomalies could stem from systemic weaknesses in oversight and internal controls, warning that such lapses risk the misappropriation of public funds and the payment for jobs not performed.

On the irregular execution of contracts, the audit report states: “Eight (8) payments totaling N1,784,914,931.59 were made for supplies in 2022 without specifying the name of the sites or locations to which the contracts were executed, and the certificates of practical completion and the Federal Controller’s notification of project completion made available for audit did not specify where the supplies were made and installations were done.”

Regarding irregular award of contracts, the report adds: “Two (2) payments totaling N980,000,000.00 were made to a contractor vide paid voucher numbers FMWH/PROC/PBHD/CAP/1353/2021 and FMWHPROC/SPU/CAP/2021/4079 dated 28th of January 2022 and 8th of March 2022, respectively, for the construction of road drainages and culvert at the Federal Government Site and Services in Oyo State. The contract was awarded on a Sunday, precisely the 22nd of December 2019, when offices were closed for business activities, and there was no evidence that the contract was executed before the vouchers were raised.”

The audit further found that the Ministry awarded 24 contracts for the supply of items such as sewing machines, tricycles, water pumps and generating sets, amounting to N1.68 billion, without documentary evidence confirming delivery to beneficiaries. The Office of the Auditor-General warned that this creates challenges in verifying the authenticity of the procured items and exposes funds to potential diversion.

In response, the Ministry acknowledged some lapses and claimed corrective measures had been instituted. However, for certain issues, the audit noted: “Since the Management failed to respond to the issue raised, the findings remain valid until the Management implements the recommendations.”

The audit directed the Ministry to account to the Public Accounts Committees of the National Assembly, recover the irregular sums and remit them to the Treasury. Failure to comply may attract sanctions as prescribed in the Financial Regulations (2009).

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