Revenue leakages in NNPC caused by Buhari’s hold on ministerial post ― PDP Governors

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3 years ago

Tambuwal

Governors of the Peoples Democratic Party (PDP) have blamed the revenue leakages occurring in the Nigerian National Petroleum Company (NNPC) Limited on the continued retention of the minister of petroleum resources portfolio by President Muhammadu Buhari.

Rising from a meeting in Aba, Abia State on Wednesday, they posited that the solution to the problem is for the office of the minister to be separated from that of the president.

A communique read by the chairman of the PDP Governors Forum and governor of Sokoto State, Aminu Tambuwal, noted that the NNPC deducts N8.33 billion monthly for the rehabilitation of the refineries in Nigeria but till date, no refinery is working.

The communique also maintained that on priority projects of the nation’s oil industry, NNPC deducted N788.78 billion for various investments between 2018-2021 without recourse to the Federation Accounts Allocation Committee (FAAC).

The governors rejected claims by the company to have paid about N1 trillion in petroleum subsidy in one year.

It added: “NNPC in 2021 alone claimed to have paid over One Trillion Naira as petroleum subsidy. Indeed, in the month of March 2022, N220 billion was deducted as oil subsidy with a promise that N328 billion will be deducted in April 2022. This is unacceptable.

“NNPC and FIRS, as well as other remitting Agencies, continue to apply an exchange rate of N389/$1 as against the Import and Export window of N416/$1. The extent of this leakage can be better felt if this rate is compared to the current N570/$1.

“From available records about N7.6T is withheld between 2012 and 2021, by NNPC from the Federation Account. All these are said to be payments for oil subsidies.

“Conclusively, we believe that all these leakages in NNPC have been made possible because the President is also the Minister of Petroleum. The urgent separation of these two portfolios has become necessary.”

The meeting expressed concern and alarm over various reports and claims of incidents of stealing of crude oil ranging from 80% to 95% of the production made by industry practitioners and called on the Federal Government to set up an appropriate mechanism to reverse this trend and bring perpetrators to account.

The PDP governors again decried the inability of the NNPC to make its statutory contributions to the Federation Account inspite of oil selling at above $110.

The governors added: “It is patently unconstitutional for NNPC to determine at its whim and discretion when and what to pay to the Federation Account, as it is a mere trustee of the funds for the three tiers of Government: Federal, States and Local Governments.

“We once again, call for investigations and audit of the quantity of consumption of fuel ascribed to Nigerians and for the deployment of technology at the filling stations to determine in a transparent manner the volume of consumption.

“The Governors would resist any further attempt by NNPC to ascribe unsubstantiated subsidy claims to other tiers of government.”

After reviewing “the excruciating hardship and suffering being meted out to Nigerians by a failed APC led Federal Government; the near-collapse of the APC as a viable political party, the readiness of the PDP to take over and offer qualitative leadership options to rescue the nation,” the PDP governors affirmed that life under the former ruling party was far better than today.

The communique added: “We lament the terrible pain and hardship facing Nigerians in virtually all aspects of life. The meeting noted that life was much better in 2015 under the PDP than today under the APC as exemplified in the following Comparative Indicators obtained mainly from the National Bureau of Statistics:

“Diesel which is critical for running of SMEs was N131.47 in 2015, it now costs above N700; fuel: Official and Black-Market was N87/155 in 2015, it now costs N167/350; Aviation Fuel/Air Ticket Rate on Domestic Flights was N110 per litre/N18,000 in 2015, it now hovers around N700 per litre/N70,000, where available. Indeed, the scarcity of fuel which has resulted in a loss of several man-hours is a disgrace to Nigeria.

“The collapse of the National Grid (126 times in 7 years – (June 2015 to March 2022) and its consequences for non-availability of power is most unfortunate.

“Kerosene (NHK) used by the ordinary Nigerian for cooking and power was N180 in 2015, it now sells at ₦450; Liquefied Petroleum Gas (LPG) – 12.5kg Cylinder sold for N2,400 in 2015, is now sold at between N8,750 and N10, 000.

“Prices of basic foodstuffs are now three times higher than what they used to be in 2015. Staple foods such as rice, beans, cassava flakes are now slipping out of the hands of average Nigerians. Indeed, a Bag of Rice sold for N8500 in 2015 is now N39,000.

“Electricity was N14.23 per kilowatt in 2015, it is now N38.530, and not even available; the Unemployment rate was 11.4% in 2015, it is now over 33%, one the highest in the world; and the poverty rate in 2015 was 11.3% but now about 42.8%.

“Accumulated Inflation in 2015 was about 4%, it is now 15.50%; Inflation Rate was 9.01% in 2015 and now 15.7%.

“Perhaps the Exchange Rate has been one of the most disastrous. N150 to a dollar was the parallel market (patronised by most businessmen and Nigerians) rate in 2015, it is now about N580 to $1 in the parrel market and still rising.

“Debt and Debt Servicing: Domestic Debt of N8.4T and External Debt of USD 7.3b was incurred between 1999-2015.
While Domestic Debt of N7.63T (June 2015-Dec 2020) and USD28.57b as of Dec 2020 was incurred. External debt of USD21.27b was incurred between June 2015 and 2021.

“National Debt to GDP ratio was 23.41% (2016) it is now 36.88% (2022).

“The Corruption Index has risen from 136 in 2015 to 150 now; Nigeria’s Misery Index, an indicator used in determining how economically well off the citizens of a country are, is usually calculated by adding the seasonally adjusted unemployment rate to the annual inflation rate, has moved from 14.75 per cent in 2015 to 50.48 (2021) and the major threat to the agricultural sector and food security in Nigeria is insecurity.

“In the northeast of Nigeria, it is estimated that no fewer than 70,000 hectares of arable farmland have been abandoned in the affected States and Local Government areas. The trend is the same all over the country. This further contributes to food inflation. The APC led Federal Government must take steps to cooperate with States to bring security down to the grassroots.”

The governors expressed surprise that in the face of the distressing statistics, the APC is still seeking to remain in power in 2023.

“The Forum is surprised that in the face of these statistics of complete failure in all ramifications and areas, the APC still wants to be on the ballot in 2023.

“This shows how uncaring and insensitive the APC is. It has become a menace to Nigeria,” the PDP governors declared.

The Forum, therefore, urged Nigerians to reject the APC, a party, which it observed, is “run undemocratically by a Committee contrary to the Constitution (S.228) with Mr President regularly issuing instructions and dictates. It is impossible for a party so disorganized to offer good governance to the people of Nigeria.”

The governors also decried the non-remittances of revenue to the Federation Account by 18 agencies of the federal government.

They maintained: “As of today, 18 (Eighteen) Federation Revenue Agencies are not paying/remitting any revenue to the FAAC Account. These include (i) Central Bank of Nigeria (ii) Nigeria Maritime Administration and Safety Agency (NIMASA) (iii) Nigeria Liquefied National Gas (NLNG) (iv) Nigeria Communication Commission (NCC) (v) Economic and Financial Crimes Commission (EFCC) (vi) NPA (vii) Security and Exchange Commission etc.

“FIRS and DPR take the cost of collection of 4% (Four per cent) of Revenue collected while Customs collects 7%. In March 2022 for instance, FIRS took N15.4Billion as the cost of collection and Customs took N8.4b. If these are annualised, FIRS and Customs collect about N1.84Billion and Customs N100B per annum. Obviously, some states of the Federation’s capital budget does not come close to these.

“Nigeria Federation has 49% shareholding in NLNG. According to the Minister of Finance during the 2020 budget performance brief at the National Assembly stated that the federation received a dividend of N144billion (One Hundred and Forty-Four Billion) from NLNG. These figure to the best of our knowledge was never paid into the Federation Account.”

The meeting, hosted by Governor Okezie Ikpeazu of Abia State, was attended by 12 governors and one deputy governor.

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