…Says It’s a Backdoor Way of Passing On N26bn Debt Burden to the Poor Convener of Citizens Rally Against Oppression, Mr. Adesina Ogunlana, has called for mass action to resist the planned tolling of Ikorodu-Ogijo-Sagamu, Epe-Ijebu-Ode and the Lagos-Ota-Abeokua expressways by the Lagos and Ogun governments, saying that it is an ostensible move to
…Says It’s a Backdoor Way of Passing On N26bn Debt Burden to the Poor
Convener of Citizens Rally Against Oppression, Mr. Adesina Ogunlana, has called for mass action to resist the planned tolling of Ikorodu-Ogijo-Sagamu, Epe-Ijebu-Ode and the Lagos-Ota-Abeokua expressways by the Lagos and Ogun governments, saying that it is an ostensible move to further strangulate the poor.
Ogunlana, a former chairman, Ikeja branch of the Nigerian Bar Association (NBA) and presidential aspirant in the forthcoming national 2020 elections of the NBA, condemned the muted plan to commercialise the three federal roads by Ogun State Governor, Mr Dapo Abiodun and his Lagos State counterpart, Mr Babajide Sanwo-Olu as inhuman.
In a press statement issued by Mr Ayo Ademiluyi, secretary of the group and director, Media, Strategy, Publicity and Communications of #ProgressiveBar, the campaign platform of Mr. Ogunlana, the planned tolling of the roads is described as a ploy to shift a debt burden to the poor.
Ogunlana stated that the arguments of both Lagos and Ogun State Governments that the tolling was designed to encourage Public-Private Partnership in the construction and rehabilitation of the three roads, is an unwarranted basis to exploit the masses.
He frowned at the backdoor moves by both states’ governments to pass the burden of the N26 billion debt purportedly hanging on the state governments’ neck over the construction of the Lagos-Abeokuta Expressway, to the masses in both Lagos and Ogun State.
Governor Abiodun, has said motorists plying the Ikorodu-Ogijo-Sagamu, Epe-Ijebu-Ode and the Lagos-Ota-Abeokua roads would now pay tolls, adding that the two governments had agreed to commercialise the three federal roads in order to make their maintenance an easy task.
Abiodun said his government in collaboration with Lagos, was planning to engage in Public-Private Partnership in the construction and rehabilitation of the three roads.
The Governor, who disclosed this at the weekend when addressing members of Abeokuta Club during his investiture as honorary patron, said Sanwo-Olu and himself had met and agreed to commercialise the roads by allowing the private investors fund and toll the roads so as to ease transportation of people from Lagos to Abeokuta.
Abiodun further disclosed that N26 billion debt is hanging on the state government’s neck over the construction of the Lagos-Abeokuta Expressway since the contract was signed in 2001 and explained that the government is expected to pay over N1 billion every year to service the debt incurred on the road.
“I met with my counterpart, Sanwo-Olu and we decided that as a matter of urgency, we need to take over some roads which include Epe-Ijebu road, Ikorodu-Sagamu road and Lagos-Ota-Abeokuta road to reduce the population of the people passing the Lagos-Ibadan expressway.
“Together, we met with the President to hand over the three roads to us. We sat down with the President and explained things to him. He told us to put it in writing; we wrote a joint letter, which has our two logos on it; we both signed it and I personally handed it over to Mr. President, and a few weeks ago, the President handed over the roads to us.
“You cannot expect people to come to our state if they can’t move around with ease or move from Ogun to other states. We all know that the Lagos-Ibadan expressway is ongoing and the truth is that the road won’t be completed until December of next year.
“However, as a government, we have done a lot of road count and have come with the fact that if that road is completed, it does not have the capacity to transport the population of people that pass through that corridor, reason why on our own, we are embarking on the three critical routes,” Governor Abodun said.
The two governments have however not revealed the exact cost of the Public-Private Partnership and how long the tolling would last before ownership of the roads would revert to the Ogun and Lagos governments.
Public-Private Partnership (PPP), according to the International Finance Corporation (IFC), is a tool that helps governments leverage the expertise and efficiency of the private sector, raise capital, and spur development. They also help allocate risk across the public and private sectors to where it can best be managed and ensure that resources are wisely distributed in addressing the most urgent development needs –
The experience of the PPP arrangement on the Lagos- Epe expressway which was rebuilt at the prohibitive cost of N1bn per kilometre may provide some sour taste. The 30-year agreement for tolling before full ownership reverts to the Lagos government has been described as some rip off. Many also argue that it is grossly inhuman to toll an existing road after reconstruction.
The Lekki-Epe Toll Road Concession Project which is the first-ever PPP Toll Road Project in Nigeria commenced in 2000, with the placing of advertisements by the Lagos State Government for proposals as to how key road infrastructure within the swelling metropolis of Lagos could be developed on a PPP basis.
Asset & Resource Management Company Limited (ARM) submitted a proposal in relation to the rehabilitation, construction, operation, maintenance and tolling of numerous stretches of highway infrastructure within Lagos and was duly mandated in 2003 to develop a toll road corridor along the Lekki peninsula. The Concession Agreement was eventually signed by the concession company, Lekki Concession Company Limited (LCC).
The concession agreement gave LCC the following rights:
- to design, rehabilitate, construct, operate, maintain and toll the existing 49.5km Epe Expressway (which widened and rehabilitated as Phase 1 of the project),
- the introduction of three toll plazas (with a maximum 22 lanes/plaza)
- to build a 20km coastal road which will be an expressway running parallel to the existing road (as Phase 2 of the Project; and
- to build the Southern Bypass which is an additional option for LCC in the Concession Agreement.
The scheme is structured as a Build-Operate-Transfer (BOT) project, with the road infrastructure being handed back to the state at the end of the concession term. This was achieved in 2017 when the Lagos State bought the concession right back.
Construction of the Phase 1 works was undertaken under a turnkey, lump-sum, fixed price contract which also includes a 5-year maintenance obligation on the contractor. To further assist in aligning the interests of the investors and the contractor, the contractor took an equity interest of up to 5% in LCC in exchange for an agreed reduction to the EPC price. “LCC”) on 24 April 2006 and achieved financial close in 2008 with a total project cost of US$430M (debt and equity).
Photo: Delapidated Lagos-Abeokuta Expressway