Harmony Holdings replies ‘concerned citizen’ on spurious allegations

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• Says company desolate before the emergence of new administration

• GMD Abdulmajeed ranks tall in cutting costs. • Attempt to cause division among staff ungodly, nefarious Harmony

Holdings Limited has reacted to a publication by a faceless concerned citizen, saying the grouse of the in-house saboteurs behind it is not in the interest of Kwara’s socio-economic prosperity but self-interest and personal aggrandizement. In a 9-page rejoinder written by the Corporate Affairs Unit, the publication was described as “a classic case of corruption and ineptitude fighting back because of the far reaching impacts of the ongoing turnaround management efforts of the current management which clearly negates personal aggrandizement that used to be the hallmark in the organization for many years before the coming of the Mal. AbdulRahman AbdulRazaq led administration.” The statement explained that the new administration inherited a holding company that was desolate and unsustainable, sitting on Kwara’s assets in a manner that benefits the few running the company at the expense of over 3 million Kwarans. “It is surprising that the crop of staff masquerading as concerned citizens but whose cover has been blown through due diligence efforts never deemed it fit to raise their voices at the time the pioneer management of the company led by Mr. Tope Daramola and the likes of Mr. Bayo Sanni and their co-travellers were sowing this seed of the destruction of the company in the days when it had sufficient resources at their disposal that could have been used to build a formidable foundation. These persons who were their direct principals rather than laying a structure to run the company sustainably preferred to use their closeness to the previous government of the state to misappropriate and mismanage Kwara’s assets to derive personal gains. It was no doubt not a matter of concern to them then because they were cohorts in the corrupt practices and by their orientation nothing else matters to them once their salaries and allowances are being paid even if the whole asset of the state is frittered away. Those irresponsible actions are the harbingers of the state of insolvency that this administration met Harmony Holdings and most of its subsidiaries. That the current GMD has resisted their pressure on him to revert back to the old order of taking money from the subsidiaries at will to pay salaries of staff of the holding company or go to His Excellency the Governor all the time with an entitlement mentality to source for funds is something that we had always known they will attempt to fight dirty on.” According to the statement, the unsustainability crisis battling the company dates back to 2016 when most of the subsidiaries had already been stretched beyond control, with salaries and allowances becoming irregular. It noted further that the holdco was owing 7 months salaries before the appointment of the new GMD, just as subsidiaries across the group had outstanding of at least 4 months with nothing in the treasury of the holdco. It was Mal. Abdulmajeed the new GMD that explored means by which the backlogs were defrayed as one of his first assignments on getting to office, thanks to His Excellency the Executive Governor of Kwara State for his commitment to the total repositioning of all sectors and entities in the state without exception. “The holding company failed to invest significantly its startup capital in any income generating or value accruing expenditure but rather squandered the total sum of Four Hundred and Forty Million (N440,000,000) released to it out of the appropriated sum of Two Billion, Five Hundred Million Naira by the previous administration of Governor AbdulFatai Ahmed. Inspite of the fact that what was released from the total amount appropriated is paltry, it was a very significant capital that would have impacted significantly in the fortunes of the company were its leadership visionary and committed. The amount in question is in addition to the over one billion naira of further accruals obtained from various sources over a period of eight years on recurrent expenditure and consumables without even as much as building the human capacity and organizational structure that is capable of enabling it to carry out its self-assigned core responsibilities of providing oversight functions over the subsidiaries. “This is certainly not an anomaly in the face of the corruption inclined and free riding staff who were enjoying the windfall of that era when they were the closest staff to the perpetrators of the above wreckage which they aided and abetted. “Hardly had the holding company taken off than it slided into insolvency because of its overbloated costs and inability to adopt an effective cost to revenue structure. So bad was it that it could not meet up with its basic monthly obligations and operational overheads for two years consecutively. It was common practice at several intervals in the annals of the existence of the company to owe its workers salaries and allowances including failure to remit statutory deductions for eight (8) months or more at a go. Such accumulated payments were usually defrayed with funds sourced from the sweating of a government asset, total disposal of properties, subvention from government or obtaining of unregularised loans from subsidiaries. “Evidences abound as to the numerous cases of poorly managed transactions which the previous managements have entered into in their desperation to get their salaries and allowances paid at all cost even if it means undervaluing the economic benefits derivable to the government from such transactions. Our management therefore came to an early conclusion following our initial due diligence that the management approach, style, methods, processes and procedures that were adopted in the past cannot deliver the goods for our people. It was also crystal clear that the holding company and all its subsidiaries will need a total overhaul in terms of resources utilization and expected deliverables, new orientation, and new direction and drive.” RESPONDING TO THE UNSUBSTANTIATED AND SPURIOUS ALLEGATIONS 1. Misappropriation of Bail-out Funds: The writer alleged misappropriation of bailout funds meant for salary payment. We should clarify that obtaining a bailout from government was a magnanimous privilege and not a right. Earlier in this submission we posited that the Kwara State government released the first bailout to clear the inherited 7 months’ salary of the holding company in December 2019 and that was implemented satisfactorily. The second request on which this allegation borders on was the group wide bailout request that the new management made to His Excellency, the Executive Governor of Kwara State in the wake of the post covid-19 lock down influenced disruption of economic activities which affected our companies significantly. Our request to government at that time sought for funds to clear outstanding salaries of staff varying from four (4) months each for Harmony Holdings, Harmony Transport Services Limited (HTSL), Harmony Ventures and Supplies Limited (HVSL) and Kwara Hotel (K.H) respectively and seven (7) months for Harmony Facility Management Limited (HFML). In view of the paucity of resources and the huge expenditure of the Kwara State Government in the management of the effects of Covid-19 in the state especially the Social Investment programmes, the office of the Head of Service made a recommendation of 50% to His Excellency who approved and released same which was implemented as directed. All the above stated companies therefore got payments for two months salaries except for HFML which we felt it was appropriate to source for some extra funds to pay them the whole 7 months in view of the fact that it’s a smaller organization which had suffered more financial challenges in the past, hence they were paid 7 months. That we refused to accept the narrative of “go back to government to assist us with balance of backlog of salaries“ is a major source of their grouse which clearly led to the campaign of calumny orchestrated. 2. Campaign of Calumny: Second issue is the fact that we need to address the source of the campaign of calumny which is obviously from disgruntled staff with an entitlement mentality. Our management has st rived overtime to change their perception and dependence mentality of thinking anybody or government has a responsibility to provide resources for the organization to meet up with its obligations while stressing the need for the company to be self-funding while making profit from its management of subsidiaries and remitting same to the government. To the credit of the ongoing reforms, a significant population of the workforce (few mid-level and more manager cadre staff) have acknowledged that position and are already cooperating with the new management to institutionalize same. However, the crop of staff masquerading as concerned citizens could not view the matter objectively going by their continued loyalty to the old order and previous management of the company whom they served as executive assistants and personal assistants respectively. 3. The criticism about recruitment of staff and all recruits from one L.G.A: The irresponsible criticism of a few employments that were made into the company recently is clearly an attempt to rubbish the few productive elements who are responsible for the bulk of the success stories being witnessed in the organization as at today in view of the fact that a majority of the old staff consistently fail to meet up with deadlines or achieve set goals. These crop of staff also obviously have an axe to grind with the new staff who run the media and corporate affairs unit of the company because of our objective presentation of the facts about the mismanagement of the company in the past. They have observed severally that our action suggests uncompromising support for the party and government of the day while we have constantly enlightened them that an objective media will never submit to the pressure of twisting the facts about what went wrong in Harmony Holdings in the last eight years and how it has succeeded in crippling the humongous investments of Kwara State before the coming of this administration. Also, it’s important to state clearly that there are currently only two full-time staff in the corporate affairs unit of the company and only one of them is from Offa local government. 4. On the Issue of Travelling Allowance: It’s sad to observe that this crop of staff could not decipher the fact that the GMD/CEO embarking on an official trip to advance the frontiers of the ongoing turnaround management is not responsible for the non-payment of salaries in the months in which the company could not pay because of paucity of funds. Rather it’s a proactive step to ensure that such moments are eliminated through the various income generating activities being spearheaded by the current management. The travelling allowance of the GMD/CEO in the trip in question includes cost of return air ticket, accommodation, feeding, intra town logistics, airport shuttles in Abuja for a period of one week engaging in value adding assignments etc. In all the years of the previous GMD/CEOs except for just one person, travelling expenses clearly outweigh whatever is being spent on such purpose today in numerous trips not targeted at any meaningful engagement as we cannot see any productive outcome of many of such and the concerned elements who were then responsible for preparing the approval memos of all sacked directors at the time never saw anything wrong in those actions especially in view of the unproductive nature of the trips but they have the temerity to criticize the official trips of the new GMD/CEO who is selflessly pursuing the reversal of the damage done by the eight years of their principals’ mismanagement. They therefore need to come to terms with the fact that the current GMD/CEO will not just sit behind his desk and sweat government assets recklessly or continue to poach on the resources of subsidiaries in a way and manner that erodes the integrity of the holding company and prevents her from carrying out its oversight functions effectively as was the case in the last management. It is obvious that the long years effect is still a terrible hangover which has continuously manifested itself in the mindset of the affected staff as only a perverted and uninformed mind will pitch the issue of the travelling allowance of the GMD/CEO for about 8 days of official engagements relating with business partners, government agencies such as CBN, NIRSAL, Bank of Industry, Mining cadastral and other private sector agri-business stakeholders necessary for the activation of the income generating functional lines of the company which includes AgriBusiness, Mining and Human Capital Development and also FAAN on the cargo terminal project to unpaid salaries especially when the company had no such funds at the time. We also want to put on record that the travelling allowance received by the GMD/CEO while on that journey is his legitimate entitlement as contained in the board approved schedule of travelling allowances for all cadres of staff and Managenent which has been in existence long before this new management came on board. The relevant units of the company provided the documents that have been relied upon for such purpose since the new GMD resumed. The question to ask the disgruntled elements under the code name concerned citizens is as follows: 1. Did the GMD fail to embark on the official trip he was paid for? 2. Did the GMD receive travelling allowances in excess of the approved schedule of allowances? 3. Did the GMD appropriate funds meant for their salaries for his travelling allowance? Or what exactly is the axe they have to grind? Finally, we understand the fact that they are threatened by the current successes being recorded in the company and across its subsidiaries in spite of the fact that every attempt to reposition the organization as self-sustaining was always frustrated by them due to their lack of capacity, commitment and unproductive mentality. Shared services which ought to be the company’s mainstay was never implemented meritoriously before now and current efforts to rejuvenate it inspite of the investment in human capital development under the current management is still recording below average results. In any holding company structure, it is shared services that should provide resources to pay salaries but the average delivery being recorded currently is largely dependent on the effort of the GMD, a few manager cadre staff and some new staff recently engaged. We are however happy to inform our major stakeholders and Kwarans alike that Harmony Holdings has succeeded in breaking away from its sordid past and new grounds are being broken on a daily basis towards the revamping and repositioning of the group with results already evident in subsidiaries such as Harmony Insurance Brokers which declared a profit for the first time in its long years of existence at the end of the 2020 financial year. Harmony Diagnostics which used to suffer perpetually from insolvency, inability to maintain its high-end equipment and posting of losses year after year has been repositioned to operate profitably in the 2020 financial year such that it embarked on a sizable asset maintenance savings throughout 2020 to overhaul most of its machines some of which have not been overhauled since its inception. The centre has also broken free from its tradition of posting losses yearly and relying on government subvention to meet up with the cost of equipment maintenance and service level agreements. This has been reversed effectively and in addition to that, the centre is undergoing a general overhauling of majority of its equipment in order to enhance its service delivery capacity to its teeming clients and this is being self-funded from its savings. Corporate Affairs Unit Harmony Holdings Limited

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