The immediate past Secretary General of the NBA Mazi Afam Osigwe has reacted to a publication attributed to the President of the Nigerian Bar Association (NBA) Mr. AB Mahmoud SAN blaming the inability of the NBA to pay branch dues to high debt profile inherited from the past administration of the NBA.
In a rejoinder issued by Mazi, he unequivocally accused the present NBA administration of spending money meant for repayment of bank loan on foreign trips, perks of office, patronage and unregulated expenses. He also challenged the administration to present its score card!
Read the rejoinder
RE: Our inability to pay branches is due to “Lack of funds and high debt profile” we inherited
I am compelled to make this clarification in response to numerous inquiries directed to me, after the publication of the above statement attributed to the NBA President, AB Mahmoud SAN.
The 2015/16 audited account of NBA which was approved at the NBA 2016 AGM in Port Harcourt, shows the financial position for 12 months from 1st August, 2015 to 31st July 2016. The Statement of Financial Activities of the Association shows a surplus of =N=467,782,550 arising from a total income of=N=1,337,287,720 less a total recurrent expenditure of =N=869,505,170. This was due to the cost control measures that were duly strengthened during the Augustine Alegeh SAN administration.
It was clearly stated in the account that as at 31st July 2016 NBA bank and cash balances was =N=182,869,988. At no time therefore did the Austin Alegeh SAN-led administration claim to have left “unprecedented hundred of millions of Naira in the NBA account” while handing over to AB Mahmoud SAN in August, 2016.
During the period under review the Alegeh administration, generated a landmark revenue that made NBA to record and account properly for a total income of N1,337,287,720 which is 67.8% increase above N796,611,049 generated in last financial year ended 31st July, 2015.
In 2016, Alegeh administration spent a total sum of N788,936,811 in the NBA House (a major priority project of the administration) to the future of our the Association . The administration believed that the best decision in managing the Asset of our Association is to re-invest in a future generating Asset rather than investing in money market which has a high risk of being greatly diminished or in ventures that will not generate revenue.
It should be noted that expenditure in August 2016, which is the AGM month, is not included in the Treasurer’s Annual Report as the cutoff date is 31st July. However, the Treasurer captured the financial position and same is included in the Treasurer’s Report for November NEC, 2016. All income and expenditure were made through the Banking system, so the records are there at the NBA National Secretariat.
The NBA House contract was awarded to Schaums LTD by the Okey Wali SAN administration at a contract sum of N2.5Billion. After the development had reached a considerable stage the
Contractor requested a variation of contract from N2.5B to about N 3.2B. The Contractor also insisted on collecting payments for sub contract works at rates the Alegeh administration considered unreasonable. This situation became intractable and ultimately led to the termination of Schaums’ contract.
The administration could not arrive at a consensus and determined the contract subject to the Contractor providing “Attendance and Service” for sub-contractors. The Contractor initially agreed but later reneged and declined to provide the service. However, the administration used some of his scaffolding materials till completion of the NBA House.
The reconciliation of accounts showed the Contractor owed NBA but the Contractor kept contesting the reconciled accounts and the matter was not resolved during Alegeh’s tenure. NBA under Alegeh thereafter, contracted BUILDING PRACTICE, a Project Management outfit that provided both architectural and engineering services. With their aid the administration was able to complete the Project at a total cost of N1.7B (inclusive of money paid to Schaums Ltd) which is far below the original contract price of N2.5B, and the reviewed variation contract sum proposed by the Contractor (Schaums) of N3.2B. Building Practice identified sub-contractors and NBA paid directly to them thereby avoiding the markup that original
Contractor would have charged. NBA under Okey Wali SAN and Alegeh paid approximately N1.4B out of the amount and the amount owed Contractors was well below N300M. This is in fact the only debt left for AB Mahmoud SAN administration by Austin Alegeh administration.
The Building, which was commissioned by His Excellency Osinbanjo, SAN, VP FRN on 12th August, 2016 is currently valued conservatively at N5B. We invested monies in the building to ensure it was commissioned and this explained why branches could not be paid their entitlements in 2016. In fact some branches were paid backlogs of Practicing Fees owed from 2013-2014, when the administration assumed office. It also paid Practicing Fees and Welfare remittances to branches for 2015. It therefore didn’t pay remittances to the branches because of the ongoing NBA House project, which today stands as a testimony of prudential management of our resources .
The AB Mahnoud SAN-led leadership of NBA has unfortunately not paid ANY of the outstanding money owed to contractors for completing outstanding electrical , air conditioning and other aspects the project. The Augustine Alegeh SAN administration paid debts it met on assumption of office. It left outstanding debts for NBA house of about 200m . The other aspects of the debts relate to Practicing Fees remittances for 2016. The expected monies for the payment of the about N80M remittances : N10M from CBN, N25M and N50M from FMOJ, government agencies and various States Ministries of Justice for 2016 AGC registration : were in fact collected by the current administration but not applied towards paying branches. These payments were to be made in the course of the Alegeh administration.
These debts which were owed contractors at the commencement of AB Mahmoud administration have not been paid despite huge receipts from Annual Practicing Fees paid by lawyers as well as from many other sources. The current administration which claims it cannot pay branches their 10% share of the practicing fees blew over N1.3BN on the 2017 Annual General Conference. From available records no AGC has ever cost up to N300M.
In fact the administration which claims it cannot pay branches because of the “lack of funds and huge debts” left for it by the Alegeh administration, spends millions of Naira every month on Hotel bill and travel expenses. Some put travel expenses at about N30M per month. Not to be left out are the huge fees paid to the President’s retinue of aides and advisers whose salary is more than than the monthly salaries of all members of staff of NBA. One is not in doubt that with better management of funds and resources the present administration could have since paid branches their entitlements.
Alegeh completed the building of the new NBA Secretariat and increased payment for branches from 10% to 20%. The current administration should show its scorecard in reinvesting monies received from lawyers since it came into office rather than blaming others for its inability and or failure to do pay branches their entitlements. There is no doubt the money owed banks could have been paid if this administration had cut down on foreign trips, perks of office, patronage and unregulated expenses by some officials and appointees.
Mazi Afam Osigwe LLM
(Immediate Past General Secretary of NBA)