Abuja — If the federal government will ever heed the repeated call on it to revoke the privatisation of the generation and distribution companies of defunct Power Holding Company of Nigeria (PHCN) it sold to private investors in 2013, it will also demand the refund of billions of naira paid out to over 20,000 workers of the PHCN from them, the Minister of Power, Works, and Housing, Mr. Babatunde Fashola, has disclosed.
Speaking yesterday at the third edition of the annual National Council on Power (NACOP) in Jos, capital of Plateau State, Fashola said the repeated call for the cancellation of the PHCN privatisation was ill-advised, and that the country had made similar mistakes in the past with its refineries only to end up being worse off in terms of importation of petroleum products and expenses on petrol subsidy.
He said the only reasonable request to make of the government in this regard would be to continue to ask for an improvement in the sector, which he claimed the government was already doing through the Power Sector Recovery Programme (PSRP).
According to the Bureau of Public Enterprises (BPE) which was responsible for the sales of the PHCN assets then, the country earned about $2 billion from the exercise, and at the same time paid about N118 billion to its workers as severance package.
"Let me set the context by once again reminding all of us that the power sector has been privatised and is largely in the hands of the private sector. Therefore, the work that needs to be done is largely the responsibility of the private sector.
"Our roles in this regard are well set out in the Electric Power Sector Reform Act 2005 pursuant to which the privatisation of the power sector took place. That law, which I urge everybody to read, clearly sets out my role as minister which is to administer the law in section 100.
"As we are all aware, there have been comments about how effective privatisation has been in the power sector and some people have called for its cancellation which I disagree with," said Fashola.
He further said: "I have expressed my disagreement with that call, I will not support it, and there are many reasons not to. But one thing I will say is for all of us to first remember that in the aftermath of privatisation, government collected monies denominated in dollars at the time I think around N165 to a dollar from the sale of those assets.
"And, what did the government do with the money? They used it to pay off electricity workers largely. So, most of the people who were members of staff got payments in different orders of millions, and just a few if any have not been paid.
"So, if we listen to that call to say cancel the privatisation, one of the first thing this country has to do is to ask for the refund of all that monies, that's one of the first thing we have to do.
"And when all that monies have been returned, we will now have to look for the dollars to repay those people who paid that money at double the price. So, just think about it, and think about all the other things we privatised. We privatised the refineries in 2006 for $700 million, then we cancelled it and got it back and we are still importing fuel but somebody has left us behind and is building his own private refinery. So, we must think these things through before we take positions," the minister added.
He also stated that four years of the power sector privatisation in operation was not enough to judge its success, adding that for over 60 years, the country's power sector had remained quite inefficient and so cannot attain efficiency within four year of privatisation.
Fashola further clarified government's responsibilities in the sector, saying: "Our role as governmental institutions at federal and state levels is to implement the laws, enunciate policies and take actions that help the private sector play its part effectively.
"However, I agree that there are problems, I understand that four years post privatisation is a transition period, and some more work needs to be done before the expected benefits of privatisation come to fruition.
"That is why we developed the Power Sector Recovery Programme (PSRP) which are a set of policies, programmes and actions aimed at solving generation, transmission, distribution, liquidity, metering, estimated billing, energy theft, safety and other challenges," he added.