Abia Assembly Uncovers How Committee Spent N107m From N200m Earmarked To Set Up State Micro Finance Bank On Overhead Cost

Abia State House of Assembly has uncovered how the State Committee on Small and Medium Scale Enterprises, established in 2018 allegedly spent over N107,803,000m on overhead cost from the N200m it received from Keystone Bank to establish Abia State Micro Finance Bank.

ABN TV reports that the State Committee on SMEs was constituted in 2018 with the mandates of among other things acquiring a Multi-tier License for the establishment of Abia Microfinance Banks in all the 17 Local Government Areas of the State in order to provide support to Small and Medium Scale Enterprises across the State.

Presenting a report on Tuesday during plenary on a petition titled, “Embezzlement of Funds Earmarked for the Establishment of the Abia State Micro Finance Bank”, Chairman of the House Committee on Public Accounts, Anti Corruption and Due Process, Hon Jerry Uzosike, observed that the Committee on Small and Medium Scale Enterprises, is made up of Dr. Eme Okoro, then Secretary to the State Government, Barr. Gab. Igboko, the then Commissioner, Ministry of SMEs, Mr. Chinenye Nwogu, the Special Adviser to the Governor on SMEs, The Director of Finance, Ministry of SMEs among others.

Findings made by the Hon Jerry Uzosike committee indicate that the SME committee made the following expenses,
Procurement of Banking Licence -N38,500,000.00
Legal fees and Corporate Services – N9,000,000.00
Bridging Finance (deductions from the Term Facility) by Keystone Bank – N19,300,000.00
Rehabilitation/Renovation of the bank building and banking hall and the One Stop Shop in Umuahia – N7,711,000.00
Procurement of Plants and Equipment – N8,728, 000.00
Procurement of Banking Software, ICT and Security Infrastructure – N7,263,000.00
Motor Vehicles – N11,000,000.00
Flag-off/Commissioning Ceremonies – N4,166,000.00
Share Capitalization Increase – N2,135,000.00

This, therefore, leaves the SME committee with the sum of Ninety Two Million, One Hundred, and Ninety-Seven Thousand Naira (N92,197,000.00) which is still intact in the Committee’s Account domiciled with Keystone Bank, Umuahia as stated by the SME Committee.

According to the Hon. Uzosike’s committee, a representative of the State Committee on Small and Medium Scale Enterprises (SMEs), and its Director of Finance made oral submissions and later submitted documents to the committee to prove these expenditures were done.

Abia Assembly expressed dissatisfaction that the Permanent Secretary of the Ministry of Small and Medium Scale Enterprises (SMEs) whose Ministry plays a pivotal role in the coordination of the Central Bank Small and Medium Scale Enterprises oriented programmes was omitted from the membership of the SME Committee.

It also discovered that the former Director of Finance of the Ministry of SMEs who was appointed as a member of the State Committee on SMEs based on her position then has continued to serve as a member of the Committee after she was posted to the Office of Head of Service instead of relinquishing her position to her succeeding Director of Finance of the Ministry of SMEs.

The House Committee on Public Accounts, Anti Corruption, and Due Process, therefore recommends that the State Committee on SMEs to, without further delay, address all the bottlenecks surrounding the transfer of the ownership of the acquired Micro Finance Bank to the State Government in order to ensure that the Bank is put into the rightful purpose for which it was acquired by the State.

It also commended the laudable vision and efforts of the Governor, Dr Okezie Victor Ikpeazu, in establishing the Micro Finance Banks in the three 3 Senatorial Districts of the State in order to provide financial support and soft loan facilities to Small and Medium Scale Enterprises across the State.

It further recommends that the Permanent Secretary, Ministry of SMEs be included as a member of the State Committee on SMEs in order to ensure proper cohesion between the Ministry and the Committee.