Govt shops for N200bn to settle PHCN’s debts

PHCN-PROTESTERS15 April 2014, Abuja – The Nigeria Electricity Liability Management Company (NELMCO) says it is shopping for N200 billion seed fund. It said the fund will give it an edge during negotiation for discounts in the course of paying for liabilities to the defunct Power Holding Company of Nigeria’s (PHCN) creditors.

Its Managing Director, Mr. Sam Agbogun made this know at a briefing in Abuja.

He said: “The seed money here is to enable NELMCO take advantage of negotiated amount. I am hoping (that) if we have that, it will give us a strong bargaining power to tell our creditors to give us some discounts. For example, if someone is owed N100million, you can seek to pay him N80million. This is why we need the money somewhere to pay instantly.”

Commenting on the challenges the company is grappling with, he said there is delay in the transfer of PHCN Supernnuation Fund to NELCOM by the Bureau of Public Enterprises (BPE).

He said the Fund that was created to take care of PHCN pensioners as they migrate to this scheme.

Agbogun said: “Why we are concerned about this fund is that we are aware that there is about 2million euro of the funds in the account and that is a huge amount of money if it is converted to naira.”

Another challenge, according to him, is that of PHCN pensioners’ harmonisation exercise that will result in about 50 per cent increase in monthly pension obligations.

The liquidation of the PHCN Superannuation Fund going forward, he said, remains a big challenge.

Agbogun expressed concern over the influx of litigation against the company, stressing that over 3,500 cases have been transferred to NELCOM.

He raised the alarm over the company’s challenges from inadequate budgetary provision to offset legacy debts, power purchasing agreement, unpaid bills and other obligations.

Asked to state the deficit between the budget for payment of pension and the actual amount required, he said N16 billion per annum is required for payment while there is only N14 billion in the 2014 Appropriation Act.

– The Nation

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