Subsidy: Nigeria senate vows to expose corruption
Adetokunbo Fakeye with agency report
Abuja, Jan. 29, 2018 (AltAfrika)-The Senate President, Dr. Bukola Saraki, on Monday in Abuja, vowed that the National Assembly would continue to expose corruption in the petroleum sector irrespective of the status of those involved in the act, saying “this unconstitutional and illegal practice must be addressed and we are not going to rest until it is fully addressed”.
This is even as the Nigerian National Petroleum Corporation, NNPC said that it is being owed N170.6billion by the Nigerian Federation as outstanding subsidy payments between January 2006 and December 2015.
Saraki spoke while declaring open a two-day public hearing on the investigation of over N5trillion subsidy payment to the Nigerian National Petroleum Corporation, NNPC between 2006 and 2016 by the Senate Committee on Petroleum Resources (Downstream), chaired by Senator Kabiru Marafa (APC Zamfara Central).
He said: “For years, our country has been plagued with the issue of fuel subsidy and for too long, a scheme designed to reduce the burden on the poor has become the cash cow of a few who continue to milk the country dry in trillions under a process so opaque and insulated from public scrutiny called fuel subsidy.
“You would recall that it was only after my motion on the 5th of March 2012, with the support of my colleagues in the 7thSenate and after a thorough review and investigation of the scheme we unearthed the monumental fraud bigger than our capital budget for a year going on in the name of fuel subsidy five years down the line we are back on the same matter. This is not acceptable and we are determined to get to the bottom of it”.
Saraki, who was represented by the Leader of the Senate, Senator Ahmad Lawan, lamented that the mere fact that the same issue is still being discussed again, “shows that those who benefit from this grand deception are not willing to let loose and government have not done what we need to do to nip this problem in the bud”.
He said the Senate had cut short the end of year recess of the committee to immediately intervene and investigate the root causes of the recent resurfacing of queues at pump stations nationwide, adding that its “findings have brought to light the fact that our downstream oil and gas industry needs critical reforms”.
“It has exposed among other things that in spite of the stoppage of the fuel subsidy regime, and the non-appropriation of funds for the scheme due to the fraud and maladministration going on in the scheme, that fuel subsidy payments continue to be paid from our commonwealth illegally and without appropriation by the National Assembly to a few quietly in order to dodge scrutiny and avoid exposure”, he added.
Saraki, however, charged the committee to get to the bottom of the issue and proffer long lasting solutions to this racketeering in the fuel market that leaves the Nigerian people poorer every year.
He went further: “This hearing today spotlights the importance of the recently passed Petroleum Industry Governance Bill (PIGB), which after many years and several obstacles faced, have been passed by the Senate and the House of Representatives for the first time in 17year and is ready for the assent of Mr. President”.
Making a presentation on behalf of the NNPC, its Chief Financial Officer, Mr. Isiaka AbdulRazaq is being owed N170.6billion by the Nigerian Federation.
He explained that the amount was arrived at after deduction of N4.950.80 trillion received as payments from the N5.121.40 trillion approved subsidy claims of the corporation from January 2006 to December 2015.
AbdulRasaq called on the committee to assist in ensuring that the outstanding debt was settled to enable NNPC effectively achieves its obligation as the supplier of last resort to the downstream sector.
He traced the advent of the subsidy regime to October, 2003 when NNPC was directed by government to commence the purchase of domestic crude oil at international market price without a corresponding liberalization of the regulated price of petroleum products.
He explained that under the subsidy regime, NNPC and other suppliers of refined petroleum products were entitled to file subsidy claims to the Petroleum Products Pricing Regulatory Agency, PPPRA.
The CFO, however, noted that unlike other oil marketers, NNPC did not receive cash payment for subsidy claims as its subsidy claims were deducted out of cost payment to the Federation Account after due certification by PPPRA.
“In summary, NNPC submits that the amount of over N5.1trillion was duly approved by PPPRA as subsidy claims for NNPC. Out of this sum NNPC is still being owed N170.6billion’’, AbdulRasaq said.
Earlier, the Minister of State for Petroleum, Dr. Ibe Kachikwu represented by the permanent secretary, Mrs. Folashade Yemi Esan told the committee that the ministry that it has delegated responsibility on subsidy to some agencies under it.
Chairman of the committee commended NNPC for the elaborate presentation while pledging its support to all stakeholders in the sector to ensure uninterrupted supply and distribution of petroleum products.
Senator Marafa noted that part of the problems in the sector was that crude oil is not being refined locally in the country.
According to him, many Nigerians did not believe that such volume of oil was imported or consumed within the period.
Meanwhile, the committee chairman refused to grant audience to the representatives of the Minister of Finance, Mrs. Kemi Adeosun; Governor of the Central Bank of Nigeria, CBN, Mr. Godwin Emefiele; Comptroller General of the Nigeria Customs Service, NCS, Col. Hameed Ali (rtd) and Auditor General of the Federation, AGF, Mr. Anthony Ayine during a public hearing.