Missing $20bn oil revenue: No presidential directive on kerosene subsidy –NNPC

 

Governor of the Central Bank of Nigeria, Mr. Lamido Sanusi
| credits: File copy

The Nigerian National Petroleum Corporation has said it never received any presidential order to stop subsidy payment on kerosene during the late President Umaru Yar’Adua administration.

The acting Group General Manager, Public Affairs Division, NNPC, Dr. Omar Farouk Ibrahim, told Saturday PUNCH in Abuja on Thursday that the corporation should not be blamed for not implementing the directive on kerosene subsidy because the NNPC did not get any instruction to end subsidy payments on kerosene.

He said, “The point of contention is about kerosene subsidy. We do not doubt that there could be a directive. But what the NNPC is saying is that it is one thing for the President to give a directive, it is another thing for the directive to be communicated down to the various agencies of government.

“The communication line in matters like this is between the President and the minister. And the minister will direct subsidiaries or parastatals working under the ministry. So in a situation where a directive was given by the President to a minister, then for reasons that are best known to the minister or the ministry, that information was not communicated to the parastatals, then you can’t hold us responsible for not implementing the directive.  As far as we are concerned, we have not received the directive.”

He argued that the NNPC was a structured organisation and would not take decisions based on “hearsay.”

Asked to comment on the allegedly missing $20bn, Ibrahim said the corporation would be able to reconcile its account before the end of the week. According to him, the NNPC would brief the Senate on its findings soon, stressing that “a large chunk of this amount is what we are reconciling now and we believe that by the end of the week, we should be able to give our report to the Senate.”

But sources at the corporation told one of our correspondents in Abuja that the CBN governor’s statement on the directive mandating the petroleum ministry to stop subsidy on kerosene was true.

Senior management sources at the corporation faulted the then Minister of Petroleum Resources, Mr. Rilwanu Lukman, for not conveying the directive of  the late President Musa Yar’Adua to agencies and parastatals under the ministry.

An official who spoke on condition of anonymity because of the sensitive nature of the subject, said, “I will give you the background.  This is something we are going to present to the National Assembly. It is true that in 2009, President Yar’Adua gave a directive. His principal secretary wrote him a memo which he approved that subsidy on kerosene be eliminated.

“When this was brought to the attention of the Minister of Petroleum Resources at that time, he immediately consulted with the finance minister, the economic adviser to the President and a number of other people.

“The Petroleum Resources minister said if government was retaining subsidy on petrol, it would not make political sense to eliminate subsidy on kerosene.  This is because petrol is elitist, but kerosene is used to cook essentially by the masses. So they decided that they would bring this to the President’s attention.”

The source explained that the group argued that if kerosene subsidy was to be eliminated, then subsidy on petrol should go too.

“When this was brought to the attention of the minister of petroleum at that time, he immediately consulted with the finance minister, the economic adviser to the president and a number of other people.’’

The official said, “As a result of that decision among these members which included the economic adviser to the president, the Minister of Finance, Minister of Petroleum Resources and the NNPC GMD, they agreed to go back to the President.

“Of course if the President had insisted on the decision after the scheduled meeting, they would have abided by it. But unfortunately they couldn’t go back to the President because that was about the time his ailment worsened.  So they never really got the time to go and sit with him on this matter.’’

He further explained, “When the directive was given to the Minister of Petroleum Resources, he did not write formally to the NNPC. So what that means is that even if the GMD was aware of this directive, it was not addressed to him, it was addressed to his boss. It was the job of his boss to now direct him formally or communicate that directive to him. Up to this minute, we have not received in the NNPC GMD’s office a letter or an instruction or a memo saying that ‘stop kerosene subsidy.’’

The Governor of the Central Bank of Nigeria, Mallam Lamido Sanusi, had on Tuesday said that the NNPC had yet to remit to the Federation Account $20bn out of the $67bn it realised from crude oil sale on behalf of the Federal Government.

According to Sanusi, the NNPC had explained that 80 per cent of the money yet to be repatriated was spent on kerosene subsidy.

He however faulted the NNPC’s claim, stressing that a presidential directive since 2009 had mandated the corporation to stop subsidy on kerosene.

Sanusi said, “I have submitted to this committee a written evidence of a presidential directive eliminating subsidy since 2009 and the NNPC needs to provide its authority for buying kerosene at N150 and selling at N40, and inflicting that loss on the federation.”

But Saturday PUNCH learnt that the Presidency had decided to ignore the CBN governor over his claim on the missing fund.

A top Presidency source told one of our correspondents in Abuja on Thursday that President Goodluck Jonathan was not favourably disposed to joining issues with Sanusi.

He said the Presidency was aware that the CBN governor was being used to present the government in a bad light and would not dignify him with a response.

The source said, “I can tell you that the Presidency will not join issues with Sanusi on this matter. After all, he has said his tenure will end in June. Let’s see how it goes.

“By virtue of his position, the CBN governor is more like an adviser to the President. Have you ever asked yourself why a government employee will decide to go out and be painting the government he is serving in such a bad light?

“Even before he made this last allegation, the Presidency was already aware that he would talk in that manner. Don’t forget that it is one year to election. He is definitely working for some people.

“It will be unfair to the President if you expect him to begin to join issues with Sanusi, his employee, on the pages of newspapers.’’

When asked whether Jonathan was not thinking of summoning the CBN governor and the  NNPC boss on the matter,  the source said, “ You will agree with me that he does not need to begin to tell Nigerians on the pages of newspapers that he will intervene.’’

Efforts to get the Special Adviser to the President on Media and Publicity, Dr. Reuben Abati, to comment were unsuccessful as he could not be reached at the time of filing this report.

Meanwhile, the committee  set up by the Federal Government to reconcile the unremitted oil revenue by the NNPC  will submit its report to the government next week.

A top government official confirmed the development on Thursday in Abuja.

The official, who pleaded not to be named as he was not officially permitted to speak on the issue, said the report would also be made available to both the National Assembly and the Federation Accounts Allocation Committee.

FAAC committee, headed by the Minister of State for Finance, Dr. Yerima Ngama, is made up of commissioners of finance from the 36 states, the Accountant General of the Federation, Mr. Jonah Otunla, as well as the NNPC representatives.

Others are representatives of the Federal  Inland Revenue  Service; the Nigerian Customs Service; Revenue Mobilisation, Allocation and Fiscal Commission.

The  source  said the report of the reconciliatory committee on missing oil revenue would be extensively discussed at the FAAC meeting, adding that this would help to deal decisively with the issues concerning returns from revenue agencies, especially the NNPC.

Efforts to get the comments of the Finance Minister, Ngozi Okonjo-Iweala, on the missing oil revenue proved abortive as her spokesman, Mr Paul Nwabuikwu, did not respond to enquiries from one of our correspondents.

However, the minister had said in the course of the reconciliation of oil revenues covering January 2012 to July 2013 that a shortfall of about $10.8bn (N1.7tn) was recorded from the domestic crude oil receipts.

She said while the shortfall had been acknowledged by the NNPC, its magnitude was still being disputed by the corporation.

She had said, “The finance ministry and the NNPC have been in discussions to reconcile; we do so every month after Federation Accounts Allocation Committee. We reconcile our figures, it is not an easy thing.

“The Federal Ministry of Finance has played its role by bringing all parties to the table to agree and discuss the outstanding funds that should be remitted to the government.

“The next stage of this discussion is to ensure that these funds are paid into the federation account. Unfortunately, newspaper headlines will not bring money into the government coffers.

“What will actually bring in the money is the hard work of completing the reconciliation exercises to find out what the NNPC has spent on its operations with supporting invoices and documentation and what has to be remitted to the treasury.

“This is the work we are actually doing now. It has not been completed, so claims by any parties in this exercise are premature.

“Let me be absolutely clear about this; the ministry of finance under my stewardship will always stand for accountability and for ensuring that monies that belong to the treasury are paid in or at least accounted for.”

Meanwhile, the CBN has insisted that there is a presidential directive eliminating the subsidy payment on kerosene from July, 2009.

 A senior official of the bank also confided in one of our correspondents that a copy of the directive had been submitted to the National Assembly investigative committee on the unremitted oil revenue.

The source said that a 20-page memo with 30 appendices, providing documentary backing for all material statements had been provided by the apex bank governor to the committee.

Calls put through to the CBN spokesman, Mr Ugochukwu Okoroafor, did not go through. Similarly, a text message sent to his mobile phone was not replied to as of the time of filing this report.