Senate threatens full privatisation of NIPOST over poor revenue

The Senate on Tuesday threatened the complete privatisation of the Nigerian Postal Service if the agency continues operating at a loss.

The Chairman of the Joint Committee on Finance, Senator Sani Musa, issued the warning during the continuation of the 2024-2026 Medium-Term Expenditure Framework public hearing at the National Assembly complex in Abuja.

Quizzing the Post-Master General of the Federation, Omotola Odeyemi, the chairman berated the lack of functionality of NIPOST offices across the country and the abysmal revenue generation, particularly from stamp duties.

The committee therefore directed the PMG to provide the names of all staff members of the organisation, allocation and salary to the committee for further investigation.

It also gave NIPOST two years to establish a plan on how to revamp the service and change the business model to achieve self-sustenance rather than operating at a loss, otherwise, it would enact legislation to ensure total privatisation.

Odeyemi incurred the wrath of the senators when she said her agency projected N18bn as personnel cost for the NIPOST 16, 000 workers across the country.

Musa lamented that NIPOST whose presence cannot be felt anywhere in the country could increase its personnel cost from N13bn in 2023 to N18bn for 2024.

The explanation of the Postmaster General that the increment was as a result of the recent hike in personnel cost by Federal Government to federal workers did not change the minds of the Chairman.

A member of the joint panel, Senator Ireti Kingibe (LP, FCT) attempted to defend the continued existence of NIPOST as a partially funded agency of the federal government claiming that every nation deserves their own vibrant postal agency.

She said, “NIPOST should not be scrapped but should be turned to a revenue generating agency.

“The only thing is that the agency was stuck in the 19th Century analogue operation instead of migrating to digital service for efficient services.

“There is nothing stopping NIPOST from digitalise their offices across the country to offer electronic services for Nigerians, deliver government services at all local government areas and even engage in financial services.”

Kingibe had hardly ended her submission when Senator Osita Izunaso (APC, Imo West) disagreed with her.

Izunaso argued that the NIPOST as it is currently structured, should not be encouraged if the country was interested in generating revenues to fund its annual budgets.

Ruling on the matter, the Chairman of the joint panel asked the Chief Executive Officer of NIPOST to forward to the committee, details of her business plan to reposition the agency to a highly revenue generating agency.

He said, “NIPOST should have been fully privatised before now because nobody is feeling their impact anywhere in the country.

“We are ready to recommend to the Senate in plenary, the full privatisation of the NIPOST except the Postmaster General convince us otherwise.

“The CEO of NIPOST should forward to the secretariat of our committee details of her business model on how the agency would be generating adequate revenues for the country through creative ideas.

“Failure to do this would leave the Senate with no other option than to recommend the full privatisation of NIPOST”

Meanwhile, the Nigerian Communications Commission has said a lack of patronage for its auctioned frequencies was responsible for the failure to meet its 2023 revenue target.

NCC Director of Financial Services, Yakubu Gontor stated on Tuesday this when he appeared before the Senate joint committee considering the 2024-2026 MTEF-FSP.

Gontor said as at September, the commission had earned N199.8bn out of its N387.4bn revenue projection for 2023.

He explained that two frequencies, 600 megahertz (MHz) and 35 megahertz (MHz), were made available for auction but there was no patronage for any of them.

He said this significantly affected the revenue generation of the commission in 2023.

Gontor said, “Our revenue projection from spectrum fee was N387.4bn. But we ended up earning N199.8bn as at September 2023, which is a significant difference from the projected revenue.

“We hope to earn more between now and December, but we may not be able to meet budgetary projection.

“This is because frequencies are usually sold through auctions and there are some frequencies that were earmarked for auction during the year.

“However, the auction did not attract the expected patronage. Those frequencies had been reserved for subsequent auctions.”

Leave A Reply

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. AcceptRead More