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| Fashola gives recipe for efficient use of PPP |
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| Thursday, 07 August 2008 | ||||||
     Lagos State Governor, Mr. Babatunde Raji Fashola (SAN) Thursday in Abuja provided guidelines for the proper use of the Public Private Partnership as a model for financing public infrastructure, saying aside from legislation, proper project conception and visioning were needed. Fashola, who spoke while making a presentation at a breakfast interactive session with State Governments as part of the Nigeria Infrastructure Summit which began at the Transcorp Hilton Hotel Abuja yesterday, said PPP projects were known to have failed in some parts of the world as a result of misconception and lack of visioning, adding that in such cases, governments had been saddled with guarantees, deductions and payments that clearly their economy could not support. He told the gathering of eminent professionals at the summit, "There should, therefore, also be long-term visioning, viability and need for the project. It must have social and public benefit and must add value and assist the economy where the project is being built. It will not be a PPP, for example, for me to build a Governor's Lodge with private fund. It is a critical point beyond legislation". Governor Fashola, who said there are already existing allied legislations however, said specific tailor-made legislation may be required in certain instances, recommending that states should be allowed to engage and make legislation in a manner that will make it feasible for them to decide where amendments were necessary. On the reason for adopting PPP as a model for financing infrastructural projects in Lagos State, Fashola said, "On the part of the public sector, it is the realization that government alone with its own resources cannot provide all the needed services that the people need such as healthcare, education, transportation", the Governor said, adding "so there must be a continuing balance and that is why we have public and private hospitals and public and private schools". According to him, "Our PPP experiences have covered a few service opportunities, the BRT, the Independent Power Project, the Lekki Infrastructure project, and Security and among others and they have been broad based in terms of local participation in the State and in the country and also international participation". He said the State Government has used its advertising and branding rights as incentive for private sector organisations to build and brand roads adding that these experiences have not been without challenges. Explaining the objective behind the Lekki Infrastructure project which he used as a case study, Fashola who said the project was the first of its type in Sub-Sahara Africa declared, "the objective was to provide access to the fast growing real estate corridor of Lekki in the Eastern axis of Lagos". He said the project was also informed by his administration's conviction that investment in infrastructure would translate to some economic growth measurable in per Capita Income. On the initial slow pace of work on the project, Governor Fashola explained that after the initial skepticism which came largely as a result of the fact that it was a road project and the concessionaires needed to be assured of their investment, the government had to embark on sustained education of those who would use the road to explain to them why they must pay toll on the road. "There has been the challenge of advocacy because since the commencement of work on the road, only two kilometres has been constructed largely due to the need to interact with the users of the road because it is a concession and therefore you must continuously give the investor the comfort that people will use the road and one cannot build by bulldozing". Fashola said his administration has to get the consent of the people to move walls back, to regain a full alignment of the road while the government also had to contend with about nine court cases, adding, "it is salutary to note that the court did not grant injunction on any of the cases both at the Federal and State levels and that gave the investors a lot of comfort to continue". He said there was need to continue to pursue arbitration while reforming the judiciary to be much more commercially responsve in settling disputes of commercial nature, pointing out that one court injunction would have stalled the Lekki project. "Again, the stakeholders in Lagos needed continuously to be educated. I became the advocate of some sort. The people wanted to know why they have to pay on their roads. Some of the argument that I put up was, "if you spend one hour on a ten kilometre stretch, can you imagine the value of fuel you are burning and the stress you suffer by staying idle. And if we make it easier for you to travel that distance in a shorter time, the toll you pay is a lot less than the value of stress that you go through", the Governor said. The Governor expressed delight that after all said and done, every one involved in the project had learnt useful lessons, adding that as the contractors have moved back to site, there had been better and stronger understanding among all the stakeholders. Fashola said that in a developing country like Nigeria which has deficit of infrastructure, PPP provides the opportunity to take private sector expertise of building and maintaining of infrastructure adding that government must use the initiative to build infrastructure to the best quality. He however added, "We cannot engage PPPs absolutely in the way they appear now because we do not have the time. Therefore as governments we must use the initiative to build the infrastructure to the best quality so that the investor may come and buy it out but if you wait for two or three years during which you need to sign protocol you may delay in giving the people the services they need".  Quote this article on your site | Print | E-mail
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