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HomeAbuja NewsWike terminates N85b affordable housing project

Wike terminates N85b affordable housing project

·       Describes contract as “ridiculous”

·       To review all housing agreements


Almost 10 years after approval was granted for the construction of 5, 000 units of houses at the Wasa Affordable Housing Site in Apo District, the FCT Administration has cancelled the N85 billion Public Private Partnership, PPP, arrangement.

FCT minister, Mr. Nyesom Wike, said the agreement entered in with private developers was not only ridiculous, but unfavourable to the administration.

Wike disclosed this, last week, when he appeared before the Senate and House of Representatives Committees on FCT, to defend the Administration’s N61 billion Supplementary Budget

He said the arrangement was skewed in favour of private developers who are expected to make huge gains from the sale of the houses.

Recall that the FCT Administration in 2014, awarded the construction of low-cost housing units in Wasa District, at an initial cost of N28 billion, which was later reviewed upward to N85 billion.

The PPP arrangement required the FCTA to provide the required land as well as primary and secondary infrastructure, while the developer provides the tertiary infrastructure for the project.

However, Wike, told the lawmakers that all the PPP arrangements on land deals in the FCT were against the government.

He said it was unreasonable for government to provide vast land and also construct assess roads, only developers to build houses which they end up selling at outrageous amounts and recoup their money in no time.

In his words, “The only PPP you see here in Abuja is with land and PPP is against the FCT. Every PPP you see in Abuja has to do with land and all against government, which I will counsel them.

“Okay take for example, the project in Wassa. Government is doing the infrastructure which was budgeted at N85 billion, then they entered into an agreement with the developer to build and sell, but no one naira is coming to us.

“Mind you, the land is our own, N85 billion is our own, then developer enters to build houses and sell to other people, so government has lost. I cancelled it. I said don’t worry, we will build the infrastructure and then we can sell and make more money. You go and build, we will sell to you.

“How can I bring 5, 000 hecters of land, then spend N85 billion for infrastructure, then one developer will come and enter into agreement. I said no, that agreement does not work where I am. It won’t work. There’s no need. They will come and meet you to talk to me, but please don’t come because what is wrong is wrong. These are the kind of things we will not accept.”

The minister, had earlier in September, frowned at the Wasa arrangement, when he led heads of relevant agencies of the FCTA on inspection of the project site.

Wike, who expressed displeasure over the terms of agreement between the FCT Administration and the private developers involved in the project, said the administration will review the agreement to ensure fairness.

He said, “We are not impressed with the arrangement made by the FCT. Government will not just cough out N85 billion and the land and we are providing all the infrastructure, then you want to give out to private developers who will now build and sell. We think that government must also participate, having provided the land and having provided the infrastructure.

“So, this kind of arrangement is not commendable at all. If we are partnering with private individuals or developers, the common sense is that you provide the land and also provide infrastructure and then they come and develop and make profit. Government can say okay we will take 10 percent, then they take 30 percent, depending. And it is in that case that government will even be involved in determining the prices that the houses would be sold. But when you don’t have that kind of arrangement, then the private developers can put the cost at any rate, which is not also affordable.”

Later in November, the minister empowered the taskforce working on the issuance of Certificate of Occupancy to critically examine the Abuja land swap initiative started since 2012.

He asked the team to review the various agreements and all other documents that have relevant information on the initiative.

The taskforce headed by the Senior Special Assistant to the Minister on Lands, Urban and Regional Planning, Michael Chinda, was also asked to review the sale of federal government houses in the FCT and bring forward the true position of things.

The minister regretted that there were several complains that some of the houses have been abandoned. He asked for a thorough investigation to ascertain the houses that have been sold, and receipts of their payments.

The Abuja land swap initiative was introduced by the FCT Administration in 2012. The system requires the administration to provide green field to developers for real property development, while the developers in turn provide specified infrastructure on the land.

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