Nigerians have continued to express mixed reactions to the reported N213 billion bail-out fund meant to assist companies that bought over the unbundled Power Holding Company of Nigeria (PHCN).
The N213 billion loan facility, being provided by the Central Bank of Nigeria (CBN), is expected to be repaid over a period of 10 years.
Mr George Iwuoha, a civil servant told the News Agency of Nigeria (NAN) on Friday in Abuja that that the companies should have sought for the loan from their banks.
“The government has no business bailing them out, rather as serious-minded entrepreneurs, they should have approached their bankers for loan.
“It should be noted that these companies held themselves out as having both the financial and technical muscle to provide Nigerians with steady power supply.
“What this means is that they must have done their feasibility study on the financial implications before delving into the project.
He described the people fronting for the distribution companies (DISCOS) as mere politicians and not experts as envisaged.
In his view, Mr Christian Nze, a Public Servant expressed concern that a problem could arise from the repayment, if not properly handled.
“There is nothing wrong in providing bail-out fund for private electricity companies from tax payers’ money, but what I think is wrong is the reported repayment method.
“However, if the services for which the intervention fund is meant is rendered to Nigerians, we may not feel the impact of the repayment within the stipulated period.
“But if the money is squandered or ends up in the pockets of a few without any improvement in the power sector, then it will be a crime against humanity asking Nigerians to pay for services not rendered to them,’’ Nze said.
According to the Federal Government, facility is meant to address the three key challenges facing the power sector.
These include inadequate gas supply for power generation, misalignment between electricity tariff and the true cost of running electricity business and the inability of generation companies to reliably produce electricity with the reduced volumes of gas.
NAN learnt that the gas debts which stand at N36 billion.
The facility is also expected to be used to execute the agreed metering programmes, procurement of transformers by distribution companies, execution of maintenance programmes and procurement of equipment by generation companies.
NAN reports that intervention fund would be provided by the CBN in collaboration with deposit money banks and will be managed by a dedicated fund manager.
Beneficiary companies are expected to repay loans obtained from the fund with a first-line charge on their revenues over a 10-year period.
The government believes that the fund will help to improve power supply in the country.
Inadequate and epileptic power supply has been identified as a key hindrance to the development of the economy.
It also believed that the improved power supply would help create jobs and the reduce unemployment rate in the country. (NAN)
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