FG owes us N170.6bn outstanding subsidy payments — Daily Times Nigeria Press "Enter" to skip to content

FG owes us N170.6bn outstanding subsidy payments

* We’ll continue to expose corruption – Saraki

Senate President, Dr. Bukola Saraki, has said the National Assembly will continue to expose corruption in the petroleum sector irrespective of the status of those involved in the act.

The development came just as the Nigerian National Petroleum Corporation (NNPC) has disclosed that the federal government is owing it about N170.6billion as outstanding subsidy payments between January 2006 and December 2015.
Saraki made the vow while declaring open a two-day public hearing on the investigation of over N5trillion subsidy payment to the NNPC between 2006 and 2016 by the Senate Committee on Petroleum Resources (Downstream).

He said the unconstitutional and illegal practice must be addressed and that the Senate would not rest until it is fully addressed.

Saraki 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 7th Senate 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”.

The Senate President lamented that 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”.

He, however, urged the committee to get to the bottom of the issue and proffer long lasting solutions to the racketeering in the fuel market that leaves the Nigerian people poorer every year.

But making a presentation on behalf of the NNPC, its Chief Financial Officer, Mr. Isiaka AbdulRazaq said NNPC is being owed N170.6billion by the Federal Government.

Read Also: N3.1bn Subsidy Fraud: How Eterna Oil MD, others forged 30 documents to defraud FG- Witness

He explained that the amount was arrived at after deduction of N4.950.80trillion 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.

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 has delegated responsibility on subsidy to some agencies under it.

The Chairman of the committee, Senator Kabiru Marafa (APC, Zamfara Central) 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.

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