Expert Demands Probe As FG Allocates Fresh N9.2bn For Moribund Ajaokuta Steel Company

…Salaries To Gulp N5.6bn, Feasibility Studies N2.4bn

The Federal Ministry of Steel Development plans to spend a total of N9.2bn on the Ajaokuta Steel Company, figures from the 2025 budget have revealed.

There had been controversies about the moribund state of the company, following claims by the National Assembly that most of the workers have been redundant for several years.

This made the Senate Ad-hoc Committee on Ajaokuta Steel Company Limited and National Iron Ore Mining Company raise concerns over the constant personnel cost appropriation to the firm.

Senator Natasha Akpoti-Uduaghan (PDP Kogi Central) had last year questioned the Sole Administrator, Summaila Akaba, on the number of workers collecting salaries from the sum of N4.2bn appropriated for personnel costs in 2024.

“From several visitations I’ve made to the complex, hardly were 10 people sighted to be around or doing anything, who are the workers collecting monthly salaries from the appropriated N4.2bn?” the Senator had said.

Ajaokuta Steel Company occupies 24,000 hectares of land, while the steel plant itself is built on 800 hectares of land.

THE WHISTLER had reported that the company had gulped N42.03bn in budgetary allocation between 2016 and 2024.

In 2025, the Federal Ministry of Steel Development has budgeted N6.8bn for the steel company and another N2.4bn for feasibility studies, bringing the total to N9.2bn.

A breakdown of the N6.8bn allocation with code: 0233011001, showed that personnel costs will gulp N6.21bn while overhead and capital expenses will gulp N233.62m and N366.85m respectively.

Another budgetary allocation linked to Ajaokuta Steel worth N2.4bn has the code: ERGP1233627 and is titled, ‘Project Preparation For Investment Mobilisation For Ajaokuta Steel Company Limited—Feasibility Studies, Eisa, Financial Modelling.’

Although the number of workers at the company has remained controversial, the ministry allocated N4.25bn as salary.

According to findings by THE WHISTLER, N1.31bn will be paid to the workers as ‘regular allowances.’

THE WHISTLER found that a total of N638m has been allocated as social contributions while the sum of N425.3m was budgeted for pensions.

A development expert and the Director African Centre for Shared Development Capacity Building (ACSDCB), Professor Olu Ajakaiye, said making budgetary allocations for the moribund steel company is necessary.

Ajakaiye explained that Ajaokuta is a company that the country must revive if it wants to develop.

The professor said the asset has not been privatized, adding that the government is obliged to meet its personnel cost until it is back to stream.

He, however, questioned the N5.5bn earmarked for workers.

Ajakaiye said, “The company is a going concern. It has not been scrapped or closed down and therefore, they have not disengaged all the staff. You have to be meeting the personnel cost of the plant.

“Unfortunately, it is a cost we have to incur because of our carelessness. The budget is not unreasonable. What we should worry about is the level of accuracy.”

He said there could be budget padding adding that “the Committee at the House of Senate should interrogate what they are allocating in 2025.”

Ajakaiye advised that an investigation should be conducted to ascertain the payroll, and bank statement.

“They might be paying some ghost workers. So, those are legitimate questions but whether or not we should provide for the maintenance of those staff given where we are is not in dispute.

“What we should worry about is the figure and the Senate and House Committee on Steel should be able to interrogate and engage with them.”

The Registrar of the Institute of Finance and Control of Nigeria, Godwin Eohoi argued that the ministry must defend the N5.57bn which he described as a bogus amount.

“It is quite possible that the figure may not be free from padding and that is what the country should worry about,” he added.

Expert Demands Probe As FG Allocates Fresh N9.2bn For Moribund Ajaokuta Steel Company is first published on The Whistler Newspaper