In a bid to revive Nigeria’s biggest steel mill company in Ajaokuta, the government has allocated the sum of N3,796,479,657 for the payment of salaries, allowances and contribution, and general utility.
The company, which was founded in 1979 but marred by mismanagement, is yet to commence full operation as plans are ongoing to revamp the facility.
Investigations into the proposed budget for the Federal Ministry of Mines and Steel Development revealed that the sum allocated to the company was for personnel cost.
A breakdown of the proposed allocation shows that N2,674,375,672, will be used for salary payments while allowances and social contributions would take N858,330,211.
Also, the sum of N3,607,976,033 was earmarked as total recurrent expenditure, while N75,270,150 was budgeted for overhead cost.
A total of N3,855,600 will be spent on travels, while N7,820,400 was earmarked for general utilities.
Under general utilities, telephone and Internet charges will cost the company N2,200,000 and N2,460,000, respectively.
The sum of N2,840,400 was budgeted for water rate while a total of N6,394,400 was allocated to materials and general supplies.
Out of the amount, N3,600,000 is for office materials/computer consumables, while newspapers and magazines/periodicals will cost N180,000 and N114,400, respectively.
The sum of N145,483,574 will be spent on the purchase of fixed assets, out of which N41,300,000 is meant for the purchase of buses.
The steel company is to purchase security and industrial equipment with N10,000,000 and N94,183,574, respectively.
Rehabilitation/repairs of the company’s fixed assets will cost N43,020,050.
An Indian company, Global Steel Holdings Limited, won the concession of the Ajaokuta Steel Mill for a 10-year period but the agreement was revoked when the Federal Government accused the firm of asset stripping, a development which led to a court case between the two parties.
The government is yet to come out with a clear decision on the offer but the Minister of Mines and Steel Development, Olamilekan Adegbite, had at the Senate last Friday said the government was looking towards Russia in renewed efforts to revive the company.