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PRESIDENCY, SENATORS SPLIT OVER HYPPADEC FUNDS

By NBF News
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Efforts by the National Assembly to adequately compensate host communities producing hydro-electricity with 30 per cent commission of the earnings of any company or authority operating in the areas has suffered a major setback.

Government described the allocation of 30 per cent as 'highly ambitious.'

As a result, the Presidency has refused to release N350 million allocated for the Hydro-Electric Power Producing Areas Development Commission (HYPPADEC) as its take-off grant in the 2011 budget.

The HYPPADEC Act was returned to the National Assembly for further amendment, reduce the 30 per cent commission to the barest minimum.

Leading debate on the amendment bill, Dahiru Awaisu Kuta, original sponsor of the bill said after consideration of the damning effect of the damming operations on the host communities and after 'we have considered the corporate social responsibility of the said company or authority to the host communities that have been dammed and dumped by the hydro dams.

'After careful consideration and consultations, we have reduced the said 30 per cent to 10 per cent of the net profit accruing to the company or authority generating electricity in this region.'

'On August 27, 2010, President Jonathan signed the HYPPADEC Act vesting it with the responsibility of managing the ecological menace due to the operations of the hydro-dams and related matters. This Act was subsequently gazetted in August as No. 87 Vol. 97.

'Consequent upon this, N350 million was allocated in the 2011 budget as a take-off grant under the Ministry of Power. The project could not however, take off because of some critical observations by the Presidency through then ministry and the Minister of Power.

'The observation was about one of the sources of the Commission's funds. That is that: section 14 (2) (a) of the Act, the 30 per cent of the total revenue generated by any company or authority from the operations of any of these hydro-dams in any member state of the Commission be credited to the Commission's funds.

'This the minister said was not only 'highly ambitious' but also 'unprecedented' because according to him, the provision unduly burdens prospective investors in hydro-generating venture with 30 per cent charge on its total revenue and that power companies operate on very lean margins.'

No sooner had Senator Kuta concluded the lead debate when the amendment came under attack in the chamber on Tuesday.

Chairman of the Senate Committee on Rules and Business, Senator Ita Enang queried the inclusion of Benue State in the HYPPADEC Act.

'Benue State does not need to come into this amendment at all,' he said.

But Deputy Minority Leader Ahmed Yerima countered Enang. He noted that inclusion of Benue State was in anticipation 'of the next generation of hydro-electric producers' in which category Benue State belongs.

Chairman of the Navy Committee, Senator Chris Anyanwu demanded a further cut from the 10 per cent being proposed by Kuta.

'I believe 10 per cent is excessive. I suggest we go down a little bit more. I would say one per cent is okay.'

Senator Mudashiru Hussein supported her. He also urged a further reduction from 10 percent to one per cent.

Referring the amendment bill to the Power and Steel Committee, Senate President David Mark urged the committee to subject the reduction in the commission to a public hearing and allow Nigerians decide how much commission would be acceptable for HYPPADEC.