INVESTIGATION: How Lagos govt sidelined local operators for foreign company with no experience in waste collection

A heap of waste in Festac
A refuse heap at Festac Town.

Brimming with confidence like the salesman of an elixir that promises to finally cure an intractable disease, the Governor of Lagos State, Akinwunmi Ambode, told participants at an environmental conference last July, that Visionscape, a foreign waste management company, was the solution to the state’s perennial refuse-collection problem.

The governor, who also used the opportunity to sell his government’s waste management programme, nicknamed Cleaner Lagos Initiative (CLI), claimed Lagos was the top waste generating city in the world with about 16,000 metric tonnes of waste daily. He said Visionscape has what it takes to realise the state’s waste-to-wealth vision.

“Through the initiative, one of the best known private sector companies in waste management is Visionscape and they are everywhere in the world. We have attracted them to Lagos and for us to do that in a period of recession speaks volume about how we are managing the state because of them, they believe if they can conquer Lagos, it means that there is nothing about waste management that they cannot conquer, which is our selling point also,” he told participants at the Water Technology and Environmental Control Conference and Exhibition (WATEC).

But weeks after the governor’s self-assured statement about Visionscape’s capacity to rid the state of waste, it became evident that the company was struggling with the task. Heaps of refuse began to gather on streets and major roads across the city. Things got so bad that residents began to fear the outbreak of an epidemic.

Overwhelmed by the volume of waste the state generates, Visionscape quietly re-engaged some private waste collectors, popularly known as PSPs, whose services had been terminated by the state government, to assist it in removing the waste across the city.

However, contrary to Mr Ambode’s claim that Visionscape has a pedigree of waste management all over the world, a PREMIUM TIMES investigation reveals that the Lagos contract was the first ever undertaken by the company.

VISIONSCAPE’S PROFILE

Though on its website, and other places, Visionscape readily flaunts its foreign origin while brandishing its offices in Dubai, the United Arab Emirate; Johannesburg, South Africa; Mumbai, India and in Essex, United Kingdom, there are no records nor evidence that it has handled any waste management projects in any of these countries. In fact, all available evidence points to the fact that Visionscape Group and majority of its foreign subsidiaries were incorporated in the last seven months with virtually no history of waste management.

Though Visionscape Sanitation Solutions, the company’s Nigeria subsidiary was registered in 2015, its current shareholders and directors, took control of the company a few months before it was awarded the waste management contract by the Lagos State Government.

Visionscape International Holdings, the group’s parent company is a registered offshore company in Dubai, where it does not have any operations and in fact is prohibited by UAE law from carrying out any business operation outside opening an offshore bank account, purchase of real estate and promotional activities.

Visionscape International Holdings is also not required to disclose the name of its shareholders and directors on a public register. Though required to keep audited financial statements, offshore companies in UAE are not required to file them.

While some investors choose the UAE to set up offshore businesses because of its effective banking system and the ease of doing business, many are drawn to the country particularly for its high-level secrecy and its zero tax regime – offshore investors in the country do not pay corporate or personal income tax.

Similarly, a search of the UK registrar of companies, Company House, revealed that a slew of companies affiliated to the two owners of Visionscape Group, Adeniyi Makanjuola and Christoffel Ackerman (also known as Harry Ackerman), a South African, were briskly incorporated within the last seven months.

The companies included Vision Gelpack Limited, incorporated on September 11, 2017; Visionscape UK Holdings Limited and Visionscape International Holdings (UK) Ltd, incorporated on September 25, 2017; Visionscape Environmental Ltd, incorporated on January 11, 2018; Visionscape CSH Limited, incorporated on February 7 2018; and Visionscape Consulting Ltd incorporated on March 13, 2018.

There is also Vision Petlon Polymers UK Limited, a company that was incorporated as Vision Polymer (UK) Limited on June 20, 2017 but underwent at least four name changes within three months of its being registered. Mr Makanjuola was, however, removed as a director of the company on February 20, 2018, 11 days after he was appointed.

In India the story isn’t exactly different. From all indications, its office at Level 3, Neo Vikram, New Link Road Andheri West, Mumbai 400053 is not more than a virtual office.

Businesses make use of virtual addresses as a cost-effective way of having a physical address. Most virtual offices provide mailing addresses, telephone services, meeting rooms and video conferencing facilities, which enable employees to work without being physically present at the office.

A search of the Indian Ministry of Corporate Affairs company register database produced two companies named Visionscape. The first, Visionscape Developers Private Limited, is a trading company set up in 2006, while the other, Visionscape Interior Design Private Limited is an interior design firm. Both companies have no immediate connections to either Mr Ackerman or Mr Makanjuola.

When confronted with the findings of this investigation, Tolagbe Martins, of SWM Solutions, a consulting firm contracted by Visionscape and the Lagos State Ministry of Environment on the Cleaner Lagos Initiative, admitted that Visionscape may not have been involved in actual “municipal waste collection” elsewhere. She, however, said the company’s chief executive officer and members of its advisory board have well-established pedigree in waste management; adding that the company’s contract transcends waste collection but involved waste processing and recycling.

“John Irvine, the CEO himself, has 35 years waste management experience, in Panama, Brazil, India. Thomas, the COO, has done waste management in Morocco, in Mali, Egypt, Congo for decades. The CEO and the advisory board between them have over 70 years waste management experience; that is what I call pedigree.”

Visionscape later claimed in an email that a member of its advisory board, Mr Singh (no first name was provided), worked for one of India’s leading waste management companies, Antony Waste Handling Cell Pvt Ltd.

Curiously, the Mr Singh was, however, not listed among the members of its advisory board posted on its website.

Ms Martins told this reporter that one of Visionscape’s technical partners was Petlon Polymers Ltd, a manufacturer of plastic products. Visionscape also added in an email that it also has an on-going partnership with another UK company, CSH Environmental, a non-hazard waste collection company.

Company House record showed that Petlon Polymers Ltd is an insolvent company, which went into administration on August 15, 2017 three weeks before one of Visionscape’s affiliate companies, Vision Industrial Polymers (UK) Limited changed its name to Vision Petlon Polymers (UK) Limited. There are no immediate connections between both companies.

However, Mark Slide, a director of CSH Environmental Ltd, is listed as a member of Visionscape’s advisory board.

A FIXED TENDER

On Thursday, May 5, 2016 a full-page unsigned vacancy advert in waste collection and management in Lagos was placed in the Guardian newspaper. The association of PSP operators said it was surprised by the advert, since none of its members placed it. The association said it complained to the Lagos State Government, but officials told it to disregard the advert. The officials also promised to publish a disclaimer, but never did.

But the PSP operators began to make sense of the mysterious job advert, when on September 6, 2016, Mr Ambode invited stakeholders in the state’s waste management to a town hall meeting at his office. After a slide presentation about waste collection and management, the governor briskly announced that he had decided to reform the waste management system in the state and has decided to concede the residential waste collection to a foreign company. He said he was going to pass a law to enable the company to operate. He explained that the new law will restrict private waste collectors commonly known as PSPs to collecting commercial wastes.

Multiple persons who attended the meeting told this reporter that the meeting lasted no longer than 10 minutes and the governor was dismissive. He directed those with concerns and questions to speak with his commissioner for environment.

Olalekan Owojori, a consultant to the PSPs, said they wrote several letters to the government explaining that their revenue was built around the collection of residential waste. He said since the PSP operators are assigned to work in specific political wards, some of them would be run out of business as some wards do not have enough commercial waste to make waste collection a profitable venture. Mr Owojori said none of the letters to the government were even acknowledged.

A month after the meeting with Mr Ambode, the state government placed an advert for tender for residential waste collection on pages 22 and 23 of the Punch newspaper. One criteria for interested company was that they should have at least 100 employees. The deadline for the submission of bids was set at 11 days after the advertisement was published.

Mr Owojori told PREMIUM TIMES that since the PSPs were by nature small businesses with no more than 50 employees each, he believed those requirements were deliberately included to prevent them for applying.

“The tender was discriminatory to existing players. The structure of the business is a small/ medium size business. Eleven days was also too short for them to form any sort of merger,” he said during a telephone chat.

Mr Owojori said by now it now became clear that the waste collection jobs advert in the Guardian of May 5, 2017 was placed by Visionscape, which eventually won the concession, or on its behalf. According to him, this was a clear indication that the company had prior knowledge of the prequalification criteria for the tender months before it was even made public.

Ms Martins said she did not see anything wrong with the job advert, which she described as a “survey.”

“Any serious market entrant will do a survey before commencing operations. Assessing the skills level is standard procedure particularly in an emerging market,” she replied via sms.

Ms Martins, in an earlier interview, had explained that the decision to award the collection of residential waste to Visionscape was a result of a study commissioned by a Lagos government inter-ministerial committee, which included the ministries of environment and justice on how to “scale up because the PSP were working but that is all they were doing.”

“A study was carried out and it was estimated that Lagos was going to need something in the region of a N100 billion to address the various issues because more compactors was not the solution. The solution was the ways to optimise the compactors that were on the road, create the structures to treat and manage the waste and then reduce what was being actually buried because of Lagos limited landmass. The scoping study was done by a company called Averda one of the biggest waste management companies in the world. How do you solve this raft of problems holistically? You pulled the best resources and brains.”

THE BLAME GAME

The decision to replace the PSPs with Visionscape almost immediately backfired. Piles upon piles of refuse was appearing at almost every available public space in the city. Sections of roads were blocked by heaps of waste thus worsening the already dire traffic situation in the metropolis. Odious smells, flies and fleas flourished on them causing fear of an outbreak of an epidemic.

Ms Martins said refuse gathered all over the city not because Visionscape was overwhelmed by the task for which Mr Ambode had spoken so loftily of its capability to handle. She also said it was not as a result of the company’s lack of pedigree in waste collection.

She said the coming of Visionscape disrupted an ecosystem of collusion between PSP operators and cart-pushers to maximize profit; so they ganged up to sabotage the company’s operations.

“The PSP are actually more political force than anyone realised. The cart-pushers work very closely with the PSP because the PSP don’t have as many trucks as they say they do, so the cart-pushers support by going rounds at a more frequent interval. The cart-pushers sort the waste and remove the recyclable and they dump the rest. Deep clean operations last year found over 2000 black spots. I am talking black spots of decades of years. And that is way it is a lucrative business. Suddenly we are saying you are not going to do that anymore, but you are going to compete with businesses.

“Rank, frank sabotage (she showed photos of what appeared to be vandalised Visionscape trucks). Trucks are being shot at, missiles are being thrown at trucks. There is video, there is evidence of open dumping at night. They literally rallied round people and told them to bring out everything and began to dump refuse in the middle of the highway,” she said.

Apart from the photos of alleged vandalised trucks, this reporter was not shown a video or any other evidence.

Ms Martins added that the PSPs were belligerent and refused to accept a handshake offered to them to work with Visionscape. She explained that when Visionscape won the contract, it planned to collaborate with the PSPs while it ramps up its capacity to a level where it can do the job independently; but its gesture was rebuffed. She, however, admitted that the government and Visionscape may not have communicated their intentions in the right manner.

“There is experience in waste. Maybe there is no experience about how things work in Lagos. Maybe there is no experience on how to carry stakeholders along. You get to a position where you cannot put a foot right because everybody is mad at you. Yet you cannot call out your client (the government).

“If your fleet was at 30 per cent capacity and you were expected overnight to handle 100 per cent, when you had said you were at 30 per cent capacity. And there is no amount of experience that can deal with the fact that you can’t do it if you don’t have the asset and the asset that are around don’t want to work with you; which was our expectation coming in that there would be a handshake,” she said.

Mr Owojori laughed off Ms Martins’ claim that Visionscape offered a handshake. He said his clients first heard of Visionscape after it placed an advert on its site for residential waste collection and they didn’t formally meet officials of the company until last January.

“If you are going to a foreign country to you want to have a handshake with existing players, the moment you land into that country, what you do is to go and meet them. If you are going to shake somebody hands, at least you have to see them to shake their hands. There was no contact whatsoever until we finally found out who they were,” he said.

He also denied that the PSPs sabotaged the Visionscape’s operations or vandalised the vehicles.

“We are businessmen. We are not thugs. That was why we went to court to challenge this discriminatory treatment. There is no sabotage. Let them show us evidence of sabotage.”

He said apart from Visionscape lacking what it takes to do the task for which they are being paid, the state government should also be blamed for the filth in the city.

“The cut of funds to LAWMA led to long queues at the dumpsite. Government started announcing that the Cleaner Lagos was going to start, that was on September 2, and it didn’t start up until December. And the moment people heard that the Cleaner Lagos was going to start, and they don’t have to pay PSP anymore, they stopped paying PSP operators.

“When there is waste on the streets, it is bad news for us. The people see dumping waste on the road as a free service. They are using it to avoid paying the PSPs. The more wastes are on the street, to PSPs it is loss of revenue. Visionscape on the other hand, the more waste they carry, the more they are paid. So, blackspots are in their interest.”

COMMERCIAL VS RESIDENTIAL WASTE COLLECTION

Visionscape said the opposition to its operation is baffling. Ms Martins claimed that the PSPs, who have now been restricted to the collection of commercial wastes following the enactment of a new environmental law, still got a better deal.

“Domestic waste is 40 per cent of that, Commercial waste is 60 per cent and the PSPs are refusing to accept the new arrangement,” she said.

She explained that Viscionscape’s contract transcends mere waste collection but includes the operation of a landfill and the production of push bins and bin bags which will be needed for collecting refuse.

When asked if the company has started manufacturing the bins and bags, Ms Martins said that they were at the stage of manual sorting of recyclables from the collected waste.

Responding to this, Mr Owojori said Ms Martins’ breakdown of the volume of residential versus commercial waste was incorrect.

“Our own breakdown is that residential is 80 per cent of the waste generated in Lagos and commercial is 20 per cent. And our analogy of this is very simple, there are more houses than there are companies, while a company pays more than an average house has volume, the major commercial areas in Lagos is Apapa, Victoria Island and Maybe Ilupeju. And from our revenue stream we see that 80 per cent comes from domestic so clearly that is the large part of the market.”

He said the PSPs were not averse to reform and are ready to work alongside new entrants in the business. He, however, said what the government has done with the far-reaching concessions granted Visionscape was to create a monopoly that will eventually stifle them out of business.

He further explained that apart from enjoying a government-granted monopoly in residential waste collection, Visionscape and one of its affiliate companies, ABC Sanitations Solution, were listed among the list of qualified commercial waste collectors.

“The government barred us from collection of waste from markets, embassies, government offices and public schools. So, what that means is that Visionscape now controls 90 per cent of waste collection in the state.

PREMIUM TIMES confirmed that ABC Sanitations and Visionscape were on the list of general waste collector published on the website of the Cleaner Lagos Initiative.

THE FAVOURED DUO

While Visionscape is enjoying unrivalled concession from the state government in the area of waste management, eyebrows have been raised by segments of the business community at the ease with which companies owned by or affiliated to Messrs. Makanjuola and Ackerman have been winning state government contracts.

The family business of Mr Makanjuola, Caverton Group, where he served as chief operating officer and an executive director, manages the state government’s security surveillance helicopter under the public private partnership (PPP) arrangement.

Messrs. Makanjuola and Ackerman are also directors and members of the advisory board of Raven Energy, a subsidiary of Raven Resources Group. Raven Energy has commenced the development of an independent power project to provide electricity to power the Blue Line of the Lagos State Urban Rail Network.

Similarly, another company owned by the duo, Visionscape Water Solution Limited, is part of a consortium of companies that have been shortlisted, alongside two other companies, for the 70MGD Adiyan Phase II Water Scheme through Public – Private Partnership arrangement.

Ms. Martins said she doesn’t see any problem with the companies winning the bids. She explains that it could merely be an indication that the promoters of the companies are more thorough with bids.

“Usually there are guidelines and specifics. Certain criteria must be met. Often, especially for Lagos State contracts, you must be registered with the Public Procurement Agency, you must be a director who has paid your taxes up to a certain level, you must display technical competence and knowledge of what you want to do and because it is Nigeria, you must show evidence of technical partnership with a company that may be specialise in that area. I don’t want to over speculate but most times when an assessment is being done, they are ticking boxes and rating proposals,” she said.

Idowu Onafowote, the General Manager of the Lagos State Public Procurement Agency, declined to comment on whether companies linked to Messrs. Makanjoula and Ackerman have been unduly favoured in the award of government contracts to the detriments of other bidders. He said as a technocrat, he cannot comment on such complaints and directed this reporter to approach the ministry of information for comments.

Kehinde Bamigbetan, the state’s Commissioner for Information and Strategy, through an aide, told this reporter to write his questions and contact in a sheet of paper with a promise to show the questions to the units and ministries concerned. Six days later, nothing has been heard from him.

Similarly, officials of state Ministry of Environment for over 10 days refused to respond to questions sent to the ministry.


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