Allegations of fraud at NAFDAC: My story, Orhii, DG

The Director General of the National Agency for Food and Administration and Control (NAFDAC), Dr. Paul Orhii, in this interview, dismisses the allegations of corruption rocking his agency. A  former Director of Finance and Account at the NAFDAC  pointedly accused the DG of fraudulent activities.
By Victoria Ojeme

The allegations flying around indicate massive fraud at NAFDAC. A former Director of Finance and Account at your agency lent credence to the claims. Where do you stand?

Talking about massive fraud at NAFDAC and  even mentioning some contractors and  companies’ names as alleged  by my former Director of Finance and Account, and  that due process was not followed in the award of contracts,  the allegations are false.

When  I came to NAFDAC,  I met an internal revenue generation of N2.5billion.  But I learnt  that over the past four years before I came in, the revenue was in the region of N9 billion. Meanwhile, since my assumption of office,  there have been progressive increase in the IGR of NAFDAC  and I think that should be a credit to me because I plugged the leakages.

Three years ago, our IGR was above N6 billion. Last year,  I think we went up to N7 billion or  8billion and, this year, we are hoping to make it N9billion.

So, for a  Director of  Finance and Account, if  we had a steady  IGR of  N9billion over the past four years, I think it is  mischievous because he is supposed to know better or he is incompetent;  it could be both, to say that we made only N9 billion  during the period in question.

And it is the money that we generate that we use to run the agency. The Federal Government only pays  our salaries.

Our  budget for this year, this is verifiable. In the area of  overhead expenditure that we budgeted over N9billion  for,  to run the agency, there is zero allocation. Last year,  it was N9billion that we proposed for overhead,  we were given N10million and, at the end of the year, we were paid only N7.2million.

But we have generated more money for NAFDAC since I came and what has it been spent on?  Those  of you who might have visited our Lagos office would have seen that we were operating from a portakabin.  Today, we have an edifice at Isolo. I think that is one of the best buildings for an agency.  We completed the building, we are not owing, we have paid fully.

Due process

Due process was followed in the allocation of contracts, including the furnishing that was alleged that the contract was  inflated; it was supposed to be N180million  but it went to N370million.  Because it was above NAFDAC approval limits, two external evaluators came and evaluated it and approved it before it was approved by the ministerial standard board and was sent back to NAFDAC; so that allegation also is false.

You might have also been told that I have so many companies that I awarded  contracts  to, this is easily verifiable. The person making the allegation  also made your job easier by providing the names of the companies. He also said I  incorporated phony companies under my name that I awarded  contracts to. This one is also very easy, you can go to the Corporate Affairs Commission because it is possible there to verify the names of the promoters of  the companies because you are supposed to have your passports and your signatures or your name or that of your relative or your distance relatives.

Some of the companies have been doing business with NAFDAC long before I came to NAFDAC and they have continued.

Zero infrastructure

Then look at some of the other achievements that we have made especially in the area of  infrastructure. The infrastructure when I came to NAFDAC  was almost zero. The first thing we did was that  on  agro-laboratory was built.  It was not for free. It was from the money that I generated, not the budgetary allocation that we got. The then president commissioned it in 2010, and for the president to  commission something, it must be something that must be up to standard.

When I came to NAFDAC, the laboratory in Kaduna had been burnt since 2004. We have rebuilt that laboratory,  we just moved in about  a month ago.

In  Port Harcourt, we did  not have  good office accommodation. We bought  land  in the GRA, built it to  standard and that building has been completed and we are about to move in. That too was not built for free, it was built with our IGR.

It was alleged that we squandered money on publicity; of course I don’t know if paying for publicity is bad;  you are the better judge of that one. They say talk is cheap but I don’t think talk is cheap with my experience at NAFDAC.

We are presently on four TV channels and we air  every week. Go and ask for the cost of putting a 20  minutes’ program  on NTA every week. And we have that  also on AIT, Channels TV and Ben TV. It  costs  money and we are not given any budgetary allocation for that. It is from this IGR  that we have put that TV program  in place.

If somebody considers  that waste and squandering of meager resources, I cannot understand because the difference between a regulatory agency like NAFDAC and  its counterparts in the  advanced countries  is that our people are largely uneducated and, if you do not properly educate them, if we don’t do public awareness, they will think that maybe it is the counterfeiter that is helping them to accept cheap medicines.

We have a  drug laboratory in Yaba; it was down, we refurbished it. Today,  it is designated as the Centre of Excellence in  Africa;  that was not for free, it was from  our IGR.

Some people  wanted  this money to sit in the  bank account so that they can generate interest for themselves, but  I believe  the money should be used for running NAFDAC activities and that is exactly what I used the money for. And as long as I continue to be at the helm of NAFDAC,  that is what I intend to do.

I use whatever money we have to run the affairs of the agency to keep  it as one of the top  20  medicine regulatory agencies  in the world.

When I came to NAFDAC, we didn’t have a credible enforcement agency. We bought land in Apapa and built a very big enforcement office that is now our pride.

One of the lands  we acquired  is in Benue; a report said it is non-existent. That land actually is six  hectares and  is on ground, it is fenced  and so  easy to identify. In fact, we have connected electricity to that place, it has bore hole.

The centenary city that is being built, the former FCT Minister gave  us 20hectares of land; 10hectares  is  to build  NAFDAC head office. So, in a few years from now, we will not be sitting here, we might  have  something that would be  better than Isolo and we would be in that office.

On this issue of  IGR, if I may recall, the last  National Assembly flayed your agency for  spending  this money, that it ought to have been paid to the Federation Account. How have you been able to reconcile that because, from what you just gave now, you are still spending the money?

I don’t see any conflict there. The law that enacted NAFDAC said that the agency can generate revenue and spend the money for the running of the agency’s business.

Now, when you have an overheard  of  N9billion  and the National Assembly budgets for you  N10million  out of which, at the end of the year, you receive N7million, now when the law allows you to generate and spend and you go and put that money in  the Federation Account, it  means you have closed down the agency.

So what I did at the National Assembly, I told them that the law, Section 80, Sub section 1, states that all the money should be paid into the consolidated revenue and budgeted by the National Assembly before the money can be spent.

But there is an exception, Sub section 3 says that unless the issue of that money has been allowed by an Act of the National Assembly.

So I told them the NAFDAC  Act is an Act of the National Assembly that allows us to generate and that is a constitutional exception.

We are not agency that does not follow the law. There is a legal interpretation. If it is interpreted that  we are supposed to generate and put there, and they are going to appropriate a lot more money for us to run the agency, I would be more than glad.

So, tell me, how do we belong to the same category with the US FDA and the US FDA needs about N400billion  to cater for half of their population or N800billion  to cater for N300million Americans and we need less than N5billion?  Let me add to it, the US FDA does not fight counterfeit medicines, that is not their business. That is the business of the FBI.

Here in Nigeria, fighting  counterfeit medicines and destruction  is not cheap.  To destroy seized medicines, we have to rent lands, carry a truck load of those medicines there, get police to guard them for 24hours before we destroy. Every year, we destroy counterfeit drugs worth billions of naira. For surveillance activities, forgetting the police, for evacuating these products, all these things cost hundreds of millions every year and prosecution. We spend over N500milion for the prosecution of counterfeiters every year. Before I came to NAFDAC, there was no single conviction, but since I came, we have had more than 10 prosecution  including the manufacturers of that Mavigay Nature.

It is by prudent management that we owe only N5billion. Our  budget,  if you compare it with the best medicine regulatory agencies in the world, in the group that we belong, we should be spending close  to  N400billion  yearly.

In a  document obtained from  the BPP,  it was stated that one of the contracts  to one Isaiah Ezetrone at a cost of  N158million was excessive and that the contractor ought not to have been given the contract because  it was alleged that they submitted fake pension clearance. And it was said that, at the end of the day, the work done after evaluation is N122million. What do you have to say about this?

Well, as you can also see, the allegation  was that the contract was given without due process. But you can see the paper there that it was not given without due process. Due process was followed. The  BPP wrote to us saying that the contract was excessive. What happened in that particular contract was that the land that we got,  the 20hectares of land at Kiani that we were supposed to build  our NAFDAC headquarters, when we got  it, there was encroachment  by the people there;  so I made a presentation to the Board  and we were told to  move ahead quickly and fence that land.

The committee was headed by the former Director of Finance and Account, the award of contract committee. If you can see, his writings are there, so he did that job. One of the things that increased the cost  of the contract was  compensation to  the natives there.

When BPP was petitioned, its officials  went there and  looked at only the perimeter fencing, they said it would cost about  N122million and not N158million  which  included  compensation to the natives. They said we should  have paid only N122million, they didn’t say that it was without due process.

They alleged that  the contractor who did the job submitted fake clearance papers; I have no way of knowing that, they are the ones who could have checked. And most of the contracts, we send them to them giving them low objection letters. So I have no way of checking fake contractors. In fact, the  BPP has  a better way of checking them. Finally, after they had checked the contractor, they came back and said we should give him N122million. So it was not a job that was given without due process or a job that was over inflated.