Time to overhaul Lekki Concession Company, by Michael Effiong

If you live in Lagos and commute around Nigeria’s commercial capital, and have any business around the Lekki-Epe axis, chances are that you would have encountered the Lekki Concession Company (LCC).

The company, which is now publicly owned, has become a huge uncontrollable monster with no modicum of respect for the very people it is supposed to serve-and is attracting very negative vibes for the present government.

Before going on to outline my angst against LCC, it will be necessary to take us down memory lane to the very beginning. Could it be that the circumstances of its birth had led to its present show of impunity and “I don’t care attitude?”

Established in 2006, the Lekki Concession Company began as a special purpose vehicle set up to execute the Lekki Toll Road Concession Project. The project was a public private partnership (PPP) scheme and used the build-operate-transfer (BOT). The concession was for a period of 30 years.

Conceived during the Governor Bola Tinubu administration, it was hailed as the best thing to happen to Lagos after the Third Mainland Bridge. It was applauded as innovative and well thought out. The government got kudos for the gigantic effort to modernise the Lekki-Epe area with our own equivalent of the German autobahn.

The original stretch of road was made up of two lanes and was tarred by the Lateef Jakande administration and so this was an initiative meant at improving that impressive job by the action governor.

To begin the execution of the project, funding came from different sources including a $85million concessionary loan from African Development Bank. This loan gave the impression that LCC had enough money to complete the whole stretch plus the alternative routes that formed a part of the project’s originally- approved design. The company had indicated that it would toll the road from Kilometre 3, Kilometre 13 and Kilometre 23.

Lagosians were enthusiastic and cared less about the tolling as far as the project is completed and they can drive smoothly on well-paved expressway from Victoria-Island to Epe.

The enthusiasm of having such a fantastic road was really high and I remember having a chat with then managing director/chief executive officer of LCC, Mr Opuiyo Oforiokuma on a Lagos-Accra flight. With a smile on his face, he told me that this expressway would add value to that corridor as well as enhance economic development and productivity. “Lagosians should be patient, they will thank us years later for the work we are doing there”, the urbane gentleman stated and I had no reason to doubt his confidence.

I want to say that Lagosians have been very patient with LCC for the past 14 years. Contrary to what was proposed and despite not working at the speed expected, LCC has been collecting toll. It also did not do much in the area of alternative routes.

Therefore, all road users going to Lekki from Victoria Island or residents of local communities along that corridor intending to go to Epe or Victoria Island have no choice but to pass through this route and pay the toll.

In no time without much work, LCC decided to build another toll plaza just before Oluwanisola Estate, the impressive home of famous industrialist Chief Rasak Okoya and began a test run in preparation for the beginning of another tolling spree before vociferous protests stopped that misadventure. Since then, it has not had the gumption to attempt it again.

As if it did not have its hands full, in 2013, Governor Babatunde Fashola added the lovely Lekki-Ikoyi Link Bridge – a 1.36 km cable-stayed bridge – to the already juicy pot of soup enjoyed by LCC. It now had bigger responsibility and making money from two fronts.

Buoyed by this monopoly and deeming itself as now untouchable, LCC forgot its responsibilities completely. The road was not worked on at the speed expected for a private enterprise. It was in the midst of this inaction that we woke up one fine morning to be told that the Lagos State Government was buying back the LCC stake for N7.5billion.

Governor Fashola had sent a letter to Lagos House of Assembly Speaker Adeyemi Ikuforiji for a further amendment to the year’s budget, this he said is “Predicated on the need to fund the acquisition and existing concession rights and toll revenue benefits held by the Lekki Concession Company, the concessionaire for the Eti-Osa-Lekki-Epe Expressway. This will effectively accelerate the transfer of the ownership of the road to the state, leaving the state with wider policy options with regards to that all-important road.” Of course there was furore in town.

In a statement signed by Ade Ipaye and Ayo Gbeleyi, commissioners for justice and finance respectively, the state government said that it had engaged in buying back of the concession rights ahead of the 30-year period stipulated in the design, build, operate and transfer (DBOT) concession agreement. This, according to the state government, is to be achieved by purchasing all the shares in LCC.

The state government stated that its decision to “buy back” the concession rights was due to several developments not envisaged in the 2006 concession agreement.

According to the statement, with the devaluation of the Naira and increased costs of construction, the underlying assumptions and market indicators under which the transaction was concluded had drastically changed in a manner that it can no longer be sustained in its current form.

“The LCC, which is the special purpose vehicle representing the investors, formally brought it to the attention of the State Government that given the rapid rise in interest rates on local loans, and other cost parameters, it is compelled to raise tolls currently being charged at Toll Plaza One from N120.00 to N144.00 per Car.

“The Concessionaire also brought it to the attention of the State Government, that as provided for under the agreement, tolling would have to commence at Toll Plaza Two.

“In addition, the Concessionaire indicated that unless it realised more income from increased rates at Toll Plaza One and commence tolling at the same rate per Car at Toll Plaza Two, it would not be able to meet its commitments to investors in the project and continue to fund completion of the remaining sections of the road.

“Furthermore, the LCC stated that Toll Plaza Three, as contained in the Agreement, must be built and tolls collected for the continued viability of the project.”

The Lagos State Government said that it felt obliged to buy out the interests of the LCC in advance of the hand-over date of 2038 under a mutual settlement option also expressly provided for in the Concession Agreement.

“This is after due consultation with all major stakeholders including the Lagos State House of Assembly based on various feedback and agitation made to the Government,” the statement said.

“Contrary to the misleading reports by some sections of the media on Wednesday, August 27, 2013 from the State House of Assembly’s consideration and approval of the 2013 Supplementary Budget, the buy-back is not and does not amount to a ‘termination’ or ‘cancellation’ of the concession of Eti-Osa, Lekki-Epe Expressway.

“The significance of the buy-back, for which the State Government deserves commendation, is that it allows the Government to take full control over the determination of the toll rates in order to continue to make it affordable for road users.

“The LCC shall therefore continue to operate as a fully commercial entity for the benefit of taxpayers and the larger society,” the commissioner said.

Now, take another look at some lines of this statement. LCC was grumbling about not collecting additional toll, imagine! Anyway, the Lagos State Government said “it will operate the new LCC for the benefit of the taxpayers and the larger society”- and this is the crux of the matter and the reason for this my epistle.

Has LCC since that buy back been working in the interest of the people? I have my doubts. Without breaking a sweat, I will say a capital No. Its activities to say the least has been anti-people.

LCC, for example, has completely abandoned the idea of extending the road, it is languishing around Ajah presently. Companies and commuters are groaning over loss of man hours and revenue.

Today, plying that part of Lagos is nightmarish. It is at your own risk. Many sections along the road have collapsed. Indeed, it is a complete embarrassment. It is a huge insult to add the word “express” to that road. It has become that bad and people now derisively refer to it as “Lekki-Epe Slowpress Road”

God help you if you are caught on that stretch of road on a rainy day. Be ready to have your breakfast, lunch and if care is not taken, dinner enroute your destination.

A friend who was so unfortunate to experience LCC’s idea of an expressway wrote on Facebook that his SUV (Sport Utility Vehicle) was disgraced that day by the rain and the gullies, and I jocularly wrote that next time, he should ensure he rides in an HUV (Heavy Utility Vehicle). It was a joke, but for those who go through this nightmare every day, it is not a joking matter at all.

As if that is not torture enough, on the Lekki-Ikoyi Bridge, LCC’s incompetence is rearing its ugly head again.

We all know that the government has ordered that no cash payment would be accepted on that bridge currently, maybe, for the sake of probity, which is a good thing, but some people are hell bent on frustrating that noble effort.

Can you imagine that I have been trying for over a week to use the LCC web portal to register and purchase the required toll pass to ply the bridge?

All I have seen written on the page www.lcc.com.ng is “We’ll be right back. Our site is undergoing scheduled maintenance. It won’t take long we promise. Come back and visit us in few days.”

LCC’s “few days” has turned into weeks, and waiting for the LCC site to function has become like waiting for Godot, that fictional character in Samuel Beckett’s famous play.

If not for impunity, how will such a website experience so long a downtime and the company had not deemed it fit to issue a statement, a clear show of impunity and lack of empathy for its clients.

How long does it take to fix such an important website? They simply do not care! In case the top shots at LCC have forgotten, it is a publicly-owned company, this kind of lackadaisical attitude is unacceptable.

I believe it is time for Governor Babajide Sanwo-Olu to reevaluate and overhaul the operations of the LCC, that monster must be tamed and whipped into shape before it throws a huge blot on his sterling record. We now pay higher tariff but get lower service,  that is not the kind of legacy this government wants to be remembered for.

In the same vein, Mr. Governor should also revisit the issue of the Coastal Road that has been on the drawing board for years now. The alignment of the proposed road has been mapped out, property owners affected have been notified and many have been refused planning approval to ensure they do not obstruct this project. Perhaps if there are more alternatives to the Lekki-Epe Expressway, LCC will not threat its clients and commuters like thrash.

Finally, it is a good thing that Mr Governor has taken a bold step regarding construction of the Regional Road, which is also key in terms of the traffic congestion and movement around that axis, kudos to him, but it is obvious that he still has many rivers to cross.

  • Effiong, a Lagos-based journalist, is editor of Ovation International magazine