EZREL TABIOWO gives an insight into the report of the Senate Committee on Finance which absolved the NNPC of any missing fund as alleged by the suspended governor of the CBN, Malam Sanusi Lamido Sanusi
The much awaited report of the senate committee on finance has dismissed the allegations made by the suspended governor of Central Bank of Nigeria(CBN), Sanusi Lamido Sanusi against the Nigerian National Petroleum Corporation (NNPC) as utterly unfounded and untrue. This followed the outcome of the committee’s investigations, whose report was submitted to the Senate during plenary last week Wednesday
In the report, the committee said it could not fathom how the alleged figure of US$49.8 billion was arrived at in the first instance by Sanusi. It further observed that the unfounded nature of Sanusi’s allegations were evident in his submissions which reflected gross inconsistencies that it described as “misleading” and “incorrect”
The report said: “That the CBN Governor at the first hearing had put forward the figure of US$12 billion as monies to be reconciled and changed his position to US$20 billion at subsequent hearing. At the conclusion of his written submission, he posited that it could be US$20 billion, US$12 billion, $10.8 billion or anything in between.”
According to the committee, the suspended CBN governor never submitted, either orally or in writing, that monies were missing, but that monies were not remitted to the federation account.
The panel further noted that “the CBN governor only posited that part of US.6 billion representing value of lifting by NNPC on behalf of NPDC should belong to the federation account and that he as not in a position to say how much as the amount. Therefore, the assumption that the entire sum of US$6 billion was to be accounted for is incorrect and misleading.”
Justifying its position, the committee noted that Sanusi, upon appearing before the it had only sought for evidence relating to US$2 billion representing value of lifting under third party financing, and whose actual value was found to be US$2,430,750,973.
But the panel also pointed out that the former CBN boss levelled the weighty allegations against the NNPC owing to the gap created by the corporation’s poor record keeping and the nonchalance with which the agency handled returns on subsidy claims on monthly basis from January 2012 to date. This, it added, contributed largely to the problem at hand.
Attempting to find out if indeed funds were unremitted into the federation account during the course of investigations, the committee amidst tendered evidence, observed that there was nothing to suggest that the submission of claims by the NNPC to PPPRA were done prior to payments being made.
On subsidy payments on kerosene, both the ministries of finance and petroleum resources disagreed on their positions; one which witnessed the coordinating minister of the economy, Dr. Ngozi Okonjo-Iweala testifying that she had not authorised any payment of subsidy on kerosene and that there was no budgetary provision for same. Her petroleum resources counterpart, Diezani Allison Madueke, on the other hand said that despite no budgetary provision for subsidy on kerosene, the ministry continues to make payments in the overall interest of the masses.
The panel, however, frowned at the NNPC’s decision to control the revenue account of the National Petroleum Development Company(NPDC). The committee noted that the corporation’s continual decision to so do undermines its status as a separate legal entity and makes proper accountability difficult.
Another instance during the course of the senate probe wherein the former CBN governor had shot himself on the foot over his inconsistent claims was at the second public hearing of the committee on February 4, 2014. The Federal Inland Revenue Service(FIRS) admitted receiving the total sum of US$16,001,887,639.67 as against the sum of US$15 billion indicated in Sanusi’s submission. The suspended CBN governor, seeing the exposure created by his incorrect claim, accepted the submission of the FIRS when asked for comment.
The Senate committee in its report at another instance found that “the sums of N888.101 billion and N971.138 billion were appropriated to meet requirements for fuel subsidy in the years 2012 and 2013, respectively, contrary to the CBN governor’s claim that such was not the case purely based on the non-filing of subsidy claims by NNPC on monthly basis.”
The panel came to the conclusion based on the submissions of the ministry of finance confirming same and the revenue profiles for 2012 and 2013 respectively as approved by the National Assembly.
The PPPRA when asked by the panel to produce certification for expenditures made by NNPC on subsidy did not fail to do so as the agency made available all subsidy claims in its submissions to the Senate.
Details of certification for subsidy payments were as follows: For PMS (Petrol), January 2012 to December 2012 was US$3,343,141,081.56 equivalent to N517,752,259,303.78; For Kerosene between January 2012 to December 2012 was US$2,281,721,090.24 equivalent to N353,370,145,245.07.
Between January 2013 to July 2013, PPRA gave certification figures for petrol subsidy as US$1,911,605,951.56 equivalent to N296,050,413,718.09; for kerosene, as US$1,230,194,700.59 equivalent to N190,520,253,280.69.
Also between August to December 2013, subsidy payments on Petrol (PMS) was US$636,914,882.88 equivalent to N593,635,120.87; and for kerosene as US$917,443,479.99 equivalent to N142,091,114,550.26, respectively.
The senate panel in its report noted that the certification of subsidy payment by PPRPRA for NNPC and other marketers was subject to the forensic audit conducted by PWC and the office of the Auditor General of the Federation.
Findings by the Senate however allayed doubts and fears on the missing funds when the committee bluntly noted that “there was never any unremitted US$49.8 billion.”
The panel stated for the records that all the agencies which included the CBN, NNPC, Ministry of Finance, and Ministry of Petroleum Resources had agreed after a reconciliation meeting that US$47 billion out of the US$67 billion had been credited to the federation account, and the amount to be accounted for, therefore was US$20billion.
Accordingly, the committee said “the sum of US$5.254 billion PMS subsidy certified by the Petroleum Products Pricing Regulatory Agency (PPPRA), part of the US$20 billion to be accounted for was adequately covered by the Appropriation Acts 2012 and 2013.”
Consequently, the committee based on its findings recommended that Inter-agencies reconciliation meetings among sensitive economic institutions listed above should be done on a regular basis in order o avoid similar episode.
The panel also requested President Gooduck Jonathan to prepare and present to the National Assembly a supplementary budget to cover the over expenditure in the sum of N90.693 billion (US$585 million) for PMS subsidy 2012 and the sum of N685.910 billion (US$4.430 billion) for kerosene subsidy expended without appropriation by the National Assembly in 2012 and 2013.
On remittances expected to be made to the federation account, the committee asked the National Petroleum Development Company (NPDC) to remit to the federation account the sum of US$447,817,884 being balance of Royalty and Petroleum Profit Tax.
It also recommended that the Nigerian National Petroleum Corporation remit the balance of US$218,069,354 to the federation account, an amount derived from gross lifting under the third party financing; as well as the sum of US$262 million being expenses the corporation could not satisfactorily defend in respect of Holding Strategic Stock Reserve; Pipeline Maintenance and Management Cost, as well as Capital Expenditure.