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MDAs In Confusion As Subsidy Claims Jumps To N521bn


There was confusion yesterday at the Senate among the Federal Government agencies over the N465.6 billion supplementary budget forwarded to the National Assembly by President Muhammadu Buhari for approval as request for additional N108 billion for fuel subsidy was made.

This is even as the Senate directed the Ministry of Petroleum, Nigerian National Petroleum Corporation (NNPC) and other relevant stakeholders to harmonise all budget claims to include payment for October to December 2015.

The Senate also asked the NNPC to break down the details of the amounts being paid to each of the independent marketers, rather than the blanket sum that was submitted.

Led by Senator Danjuma Goje, the Senate Committee on Appropriation gave the directive during a public hearing to consider Buhari’s request for a N465.6 billion supplementary budget.

The UNION reports that the requested sum included N413 billion for payment of subsidy from January to September 2015.

Subsequently, the Senate queried why the supplementary did not include the last quarter of 2015 stressing that the nation could not risk another scarcity of petroleum products due to non-payment for the months.

Buhari had in the N465.6 billion 2015 supplementary budget proposal, requested for approval of N413 billion as outstanding fuel subsidy payments to oil marketers.

But after the Committee’s observation, the Permanent Secretary of the Federal Ministry of Petroleum, Mrs. Jamila Suara, disclosed that the amount did not cover the last three months of the year.

According to her, the projected subsidy claims for the last quarter of the year apart from the N413 billion already requested for is N108 billion, which totals the sum of N521 billion needed for fuel subsidy payment in the year.

“We just called the attention of the Budget Office to the fact that the proposal for the last quarter had not really been captured because it was about N108 billion. When we started discussion on it. It was much earlier in the year, hence the tidying up was not completed,” she said.

A submission that could not be supported by facts and figures by both ministries of Finance, Budget and National Planning, whose representatives were later directed by the Committee to go for harmonisation.

Thereafter, she clarified that the major oil marketers imported 52 percent of Premium Motor Sprirt (PMS), while the Pipelines and Product Marketing Company (PPMC), a subsidiary of the NNPC was importing 48 percent.

Given a breakdown of the proposed N413 billion, she said that N120.552 billion was amounts outstanding from 2014 and N292.8 billion for subsidy from January to September 2015.

She pleaded for the understanding of the Committee, stressing that the documents were prepared before the Minister and Permanent Secretary assumed offices.

Also, the Minister of Budget and National Planning, Mr. Udo Udoma, sought the leave of the Committee to allow his Ministry, that of Petroleum Resources and the Finance to meet to reconcile for the purpose of including the additional N108 billion in the supplementary budget.

Irked by the development, Goje chided the agencies for lacking synergy in their operations, which have to do with petroleum records of regards and other very important statistics for needed action by government at any point in time.

He wondered why the Petroleum Ministry and the NNPC would forward carryover of subsidy bills from 2014 fiscal year to join the ones from January to September 2015, leaving out three critical months of the year.

More so, the Committee, detected from what Senator Albert Akpan described as intelligent report, that the NNPC had hidden its own share of over N700 billion subsidy payment, which they had deducted at source without appropriation.

To this end, the Senate panel approved Suara’s request that all the fuel subsidy agencies of government, including the Budget Office, Federal Ministry of Finance (FMF), Central Bank of Nigeria (CBN) and NNPC to return to the drawing board and submit a comprehensive bill that would cover the remaining months of the year, 2015.

“This government is about change; change from sordid past; change is to totally eliminate queues from our filling stations; every person must play a role to effect positive changes in the economy,” Goje said.

In his remarks, Senator Rafiu Ibrahim, Chairman, Senate Committee on Banking, Insurance and Other Financial Institutions, who reechoed the lack of clear synergy between the Ministry of Budget and the petroleum resources ministry, asked whether the N413 billion figure earlier forwarded included the exchange rate differential and the accumulated interest being claimed by the importers, or whether they are the agreed figures with them and their bankers.

Also, Senator Tayo Alasoadura, Chairman, Senate Committee on Petroleum Resources (Upstream), questioned details of the subsidy requests specifying exact payment due to each of the major oil marketers.

The proposed reconciliation will likely include the addition of the N108 billion projected as subsidy claims for the month of October to December 2015 not captured in the proposed N413 billion.

Earlier, the Minister of defense, who also featured at the public hearing said Gen. Dan Ali (rtd.) pledged to ensure that all the budgetary allocation to him would be utilised to tackle insurgency and achieve maximum result.

“We would ensure maximum security would be achieved within the time frame,” he said.

The Senate also considered included the outstanding N10.6 billion for severance gratuity and allowances of out-gone and incoming legislators, and legislative aides; N1.5 billion for All African Games Qualification for Rio 2016 Olympics.

Others are N5 billion for Victim Support Fund and N2 billion for Margin for Increases in Cost/Recurrent Adjustment.



-Teddy Nwanunobi, Abuja

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