The Oyo state government has attributed the N86.1 billion variation cost of the ongoing 12 developmental projects initially awarded at N200 billion to the fluctuating foreign exchange rate.
The State Commissioner for Works and his Budget and Economic Planning counterparts, Prof. Dawud Sangodoyin and Musibaudeen Babatunde disclosed this at a press briefing after the weekly Executive Council meeting on Wednesday.
Ogundoyin submitted that the government was able to reduce the proposal of the contractor for cost variation from N159.6 billion to N86.1 billion.
He stated that with the reduction, the government has saved N70 billion naira.
The Commissioner disclosed that the price review of the contract sum involves asphaltic improvement of 12 selected road construction and rehabilitation projects within Ibadan metropolis lot 1, 2, and lot 3.
According to Professor Sangodoyin, “projects affected by the price review include construction of Rashidi Ladoja Circular Road Lot 1, construction of Rashid Ladoja Circular Road Lot 2, rehabilitation of Saki-Ogboro-Igboho road, construction of Iseyin-Apomu, construction of Apomu junction to Ogbomoso, construction of Ajia-New Ife road with a spur to Amuloko, asphaltic reconstruction, expansion, and total overlay of Iwo Road Interchange to Osun-Oyo boundary, reconstruction, rehabilitation, and expansion of road network inside Aerodrome, Samonda, Ibadan, as well as junction improvement road improvement of Agodi Gate road.”
The Works Commissioner highlighted the necessity of the decision by the state government, stating that the rising foreign exchange rates have significantly increased the cost of materials and services while adding that the price adjustment became imperative for the timely completion of projects without compromising quality.
“The executive council has considered the cost submitted by the committee and approves as follows: that the reviewed countersum of the 12 ongoing projects, which I’ve earlier mentioned, stood at a total sum of ₦86.1 billion.
“Let me throw more light on this: the contractor submitted a VoP (variation of prices) of ₦159.6 billion, but the committee and experts consulted reviewed it and negotiated it to ₦86.1 billion, which saved the government up to ₦73.4 billion.
“The payment of this is subject to the milestone achievements, which are going to be consistent with the original contract. We believe that once this is done, all our projects will be distributed as we have agreed with the contractors, and of course, we shall not have any abandoned projects.”
ALSO READ THESE TOP STORIES FROM NIGERIAN TRIBUNE
