Deputy Editor, SONI DANIEL, examines the drama, the fury and the intrigues that have been thrown up by the ongoing probe of key government agencies involved in the rape of the nation in the name of fuel subsidy.? He reports that the revelations emanating from the House of Representatives on the issue are as astonishing as they are shameful to the nation and its citizens.
The furore over the fuel subsidy withdrawal by the Nigerian Government has significantly receded. As ensigns, the roads, markets, schools, public and private offices, which had remained shut while the protest over the sudden price hike, have since bounced back to life.
But the suspension of the strike by labour marks the beginning of an entirely new but sordid chapter in the life of Nigerian oil industry.? If not for anything, the audacity of labour leaders to confront the government over the inexplicable and unjustified fuel price hike, which has equally jerked consumer product prices by more than a 100 percent, has forced the docile National Assembly to turn its searchlights on the contentious subsidy debacle that has been hanging over the nation’s neck as a plague.
Government ministers and other protagonists of fuel subsidy removal must have taken their puerile campaign to sell the infamous and vile-laden issue to the public with a view to eliciting their support and understanding for the government. But it was a campaign replete with fallacies, half truths and loose ends, whose facts and figures can hardly add up despite a spirited attempt by all those recruited into the campaign to polish and present same as nothing but the whole truth.
In the build-up to the January 1, 2012 withdrawal of fuel subsidy, Labaran Maku, Nigeria’s Information Minister, Diezani Alison-Madueke, Petroleum, Ngozi Okonjo-Iweala, Finance and Coordinating Minister for the Economy had loquaciously insisted that the nation’s economy would collapse if subsidy, which gulps over N1.3 trillion yearly, was not immediately removed.
But it was a deceit taken too far into the public domain at the wrong time. With the fury arising from the avoidable pains already inflicted on the masses by the regime still raging, many aggrieved Nigerians who did not believe that the government was transparent enough in waxing the subsidy figure, beckoned on the National Assembly to look into how much the nation was actually expending on the subhead.
The unrelenting cry by the public to the lawmakers to probe subsidy payments, who authorises it and how the calculations are done, quickly paid off with the House of Representative raising a committee to probe all matters relating to subsidy.
Unlike previous assignments given to the lawmakers, which were handled with levity, the committee headed by one of the longest serving members of the House, Lawan Farouk, from Kano State, swung into action at once. On Monday, January 16, 2012, barely a week after the strike had commenced, the ad-hoc committee was already taking evidence from the relevant stakeholders.
Ministers, heads of ministries and parastatals involved in the importation and administration of fuel in Nigeria were already singing like parrots in the committee room of the House Committee on Subsidy Probe, and fumbling like drunken sailors in the process. These are the men and women who have virtually forced the president to remove fuel subsidy at once not minding the implications on the nation and its poverty-stricken masses.
By mindlessly jerking the pump price of petrol from N65 to a choking N141 and grudgingly returning it to N97 after five days of paralysis caused by the organised labour and aggrieved Nigerians, Jonathan’s regime has given itself out as the most insensitive to the welfare of Nigerians. It is on record that even though successive heads of states have at one time or the other removed fuel subsidy, none of them ruthlessly hiked the pump price of products by 120 percent at a go as Jonathan recently did, thereby inflicting incalculable pains and agony on Nigerians. Even though he has reluctantly agreed to a minor reduction, traders and service providers in the country had already raised their prices and are not ready to reverse despite the volte-face by the government.
But rather than advance their cause, the ongoing probe of ministries and agency involved in subsidy management has so far turned out to be the biggest setback to the cocktail of barefaced subsidy lies cobbled by the officials. Although they appeared as a team before the lawmakers, they however spoke as men drawn from different planets and could not put up an acceptable submission largely because their facts and figures were conceived in deceit and delivered with mischief, ostensibly to manipulate Nigerians to think in a certain way.
For instance, while finance minister, Okonjo-Iweala submitted that she did not know who authorises deduction at source by NNPC for subsidy, her petroleum counterpart, Alison-Madueke, insisted that it was indeed the ministry of finance that is saddled with the responsibility. Later, when Alison-Madueke stated that NNPC was no longer involved in fuel importation, the Nigerian Customs countered her and provided concrete evidence that the corporation was not only actively involved in fuel imports but also crude import to service the Kaduna Refinery, a revelation that caused disquiet among the officials and their interviewers. Next, when the petroleum minister stated that the country imports 35 million litres of petrol daily, the head of the PPPRA, Stanley Reginald, disagreed and provided evidence that the government paid for 59 million litres of petrol daily in 2011, meaning that 24 million litres daily or 8.76 billion litres for the year was lost to fraud that year alone.
But in all of this, none of the government spokesmen was able to tell the lawmakers what the government did with the huge sum of money gained over the years since the administration removed subsidies on diesel and kerosene. They are still tongue tied on that provocative score.
Minister of Finance, Okonjo-Iweala, who has been very vociferous on the removal of subsidy in order to boost the economy, was the first to fumble when she stood up to answer questions from the committee members. Perhaps, her failure to explain who authorises the payment for fuel subsidy set the tone for others to stumble during the day. In fact, as she stood up to face the panel, made up of Farouk Lawan, John Eno and others, her usual level of confidence began to ebb and she lost her tone, poise and focus, attributes that she has often maximised to win various contentious socio-economic issues within and outside the country.
The minister, who led the federal government team to the House, said that she was not in a position to furnish the committee with details of fuel importation, as the ministry of finance has the responsibility to verify such imports and pay the importers.
“The subsidies are paid to importers of refined products. In the case of NNPC, it always deducts its portion of subsidy at source,” the minister said.
But she was careful not to mention the controversial N1.3 trillion as the amount needed to pay for subsidy in 2011, but when the question came, she parried it, saying that the figure was only an estimate.
But Okonjo-Iweala’s answer piqued the Chairman of the Revenue Mobilisation Allocation and Fiscal Commission, RMAFC, Mr. Elias Mbam, quickly countered her and told the members that the money being deducted from source by the NNPC for fuel subsidy was shrouded in secrecy and had never been made public.
Mbam disclosed that the sum of N1.262 trillion was paid out as subsidies between January and September last year.
That explanation drew more anger and interest from the panel ists and they raised more queries. They wanted to know how the sum of N245 billion budgeted for subsidy in 2011 suddenly jumped to N1.3 billion before the end of the year. When the Director of the Debt Management Office, Dr. Bright Okogun, attempted an answer, he sank like a bait under the water. Okogun explained rather unconvincingly that the gap was created due to the non-removal of subsidy in 2010 as earlier planned by the government, adding that the figure was therefore put as mere estimate for the quantity of oil to be consumed when subsidy is eventually removed.
“There is no way to determine the actual amount to be expended on subsidy. It is determined by the prices of crude oil at the international market,” he said, but could not explain what happened to the monies deducted by the NNPC when subsidy was not removed as earlier planned by the administration.
If the drama of the first day of the hearing was exciting, the lies and blunder carefully crafted and played out by government functionaries who appeared on the second day of the probe, was enough to do a home movie. Petroleum Minister, Alison-Madueke, set the stage for the day’s drama and other events that paradoxically and unconsciously weakened whatever strong point they might have put forward in support of subsidy removal and justification for the huge amount claimed to have been expended by the regime.
Whatever fine point Alison-Madueke wanted to use in confusing the panelists on subsidy, was instantly punctured by the Comptroller-General of Customer, Abdullahi Dikko Inde.? The Minister had told the panellists that the NNPC was no longer involved in the importation of fuel and that the task was being handled for Nigeria by the private sector licensed by the PPPRA. She said unnamed persons smuggle fuel already paid for by the government thereby making the government to lose money daily.
But before she could finish her speech, the Customs boss, who was represented by the Deputy Comptroller in charge of Accounts and Tariffs, Mr. Julius Nwogu, countered her and told the panelists that NNPC was still actively involved in the importation of fuel.
He accused the NNPC and other importers of perpetuating fraud by keeping their ‘mother vessels’ in the nearby Benin or Togo territorial waters and using smaller vessels to bring the petroleum products into Nigeria.
But the minister sought to debunk the claim of the existence of a cabal in the oil subsidy business, saying, “I am under oath therefore and it will not be proper for me to speculate on the existence of cabal in the oil sector. It is not proper to criminalise certain group with one fell swoop just as we cannot criminalise the actual policy of subsidy itself.”
She, like Mr. President did a few weeks ago, described those referred to as cabal benefitting from the subsidy funds, as ‘bona fide marketers’ but admitted that there have been manipulations in the oil sector, for which the regime was looking into. She did not however name those who are corrupting the system but promised to rout out the bad eggs in the system.
But when asked by Lawan whether she would ensure that NNPC does not continue to embark on illegal subsidy deductions, the minister thundered rather defiantly, “I am under oath and cannot give you assurance on this because the oath is bigger than the assurance.”
The third day of the Lawan committee’s deliberations, threw up more dirt on the petroleum ministry, its officials and agencies involved in the importation and management of subsidies. This was when the Executive Secretary, Mr. Stanley Reginald, appeared and punctured what the minister Alison-Madueke had earlier said that the country consumes 35 million litres of fuel daily. Contrary to what the minister said, Reginald, who reports directly to her, shocked the panellists with revelation that the country recorded 59 million litres of petrol daily in 2011, leaving 24 million litres unaccounted for by the government.
That disclosure almost threw the panellists off their feet and they were enraged with the officials of the petroleum ministries and its subsidiaries more than ever. An angry Lawan stood up and asked rather rhetorically, “How could the nation be made to pay for 59 million litres daily when we consume only 35 litres daily?”
Reginald was not done with his brief. He stunned the committee the more. He said the total storage capacity for petroleum products was not enough for keep the products imported into the country and that efforts should be made to increase the capacity to check diversion.
But that did not go down well with the committee. “This is a case of serious economic sabotage because when the daily supply excess of 24 million litres is multiplied by 365 days, you get 8.76 billion litres. This is the volume of fuel that might have been smuggled out of the country in 2011,” Lawan noted furiously.
The probe into the matter was triggered by the disappointment by President Goodluck Jonathan over the handling of subsidy by relevant agencies in the country during a nationwide broadcast to end the five-day strike by organised labour that paralysed the country.
Shortly after the presidential broadcast, the Senate asked the Economic and Financial Crimes Commission to go after those who might have defrauded the nation under the guise of subsidy and bring them to account for their deeds.
A day after the lawmakers’ order, the EFCC raided the office of the PPPRA in Abuja and reportedly went away with vital documents relating to fuel imports and payments over the years but it was not clear if any of the officials had been invited for interrogation.
Although the probe of the subsidy matter? has turned out to be very revealing and interesting, it is too early to expect any serious reprimand despite the clear evidence that the country’s resources have been misappropriated by highly-placed pecuniary-conscious elements in the public and private sectors of the economy.
It is of no use to begin to expect any prosecution in this oily affair because nothing serious has ever come out of any probe ordered by the National Assembly in Nigeria, particularly when members of the ruling PDP, who control the two chambers of the legislature, are in control. As it has always been, the recommendation of this high-sounding, dreaded and tough-talking panel may just end up as one of those public relations, ego-boosting charade that Nigerians are familiar with, to allow the tension generated by the subsidy strike to ease. After that , nothing might ever be mentioned about the Lawan report as? was the case with the $16 billion Power probe, the? N2.3 billion contract scam involving the former speaker, Dimeji Bankole and the recent probe of the dubious privatisation programme of the government, despite clear evidence that major government industries were given out through the backdoor to cronies of the administration.
It is also not likely that the new EFCC boss, Ibrahim Lamorde, who was recently appointed by the President, would want to move against anyone in the government when he is yet to get a firm grip on the reins of power.? He cannot easily move against the powerful cartel in the nation’s oil industry, who reportedly bankrolled most of the elections that brought several of the key actors in today’s political arena. As one commentator puts it, it would be too suicidal for Lamorde to begin to embark on any job that his bosses have not ‘wholeheartedly authorised him’ to undertake for them.
That is why civil society groups in the country, which is familiar with the level of corruption in the country, has called on actors in the oil industry to step aside while the probe into the oil sectors is going on.
The Executive Director of the Socio-Economic Rights and Accountability Project, SERAP, Mr. Adetokumbo Mumuni, yesterday called on the government to unravel and prosecute the cabal that has been feasting in the oil industry.?
Mumuni said that without the right political will by the government to flush the cabal, it would be difficult to check the high level of corruption in the oil industry in Nigeria.
Similarly, the Nigerian Extractive Industries Initiative, NEITI, has called for proper accountability in the oil sector to bring about the needed development in the country.
NEITI Chairman, Prof Asisi Asobie, said that it was shocking to know that payments in respect of subsidy lacked transparency and due process as they did not pass through the Central Bank as stipulated by law.
A Senior Advocate of Nigeria, Olisa Agbakoba, warned on Thursday when he appeared before the lawmakers probing the subsidy payments, asked that the audit report prepared by the firm of KPMG on the operations of the NNPC be implemented to the letter if the nation must be saved from the predators in the industry.
The audit firm had indicted the corporation, saying that it short-changed the nation by N86.2 billion between 2007 and 2009 when it adopted an arbitrary exchange rate to convert crude oil sales in Dollars to Naira.? Nigerians and the world are eagerly awaiting the outcome of the probe into the dirt that seems to overshadow the gains of the God-given produce to Nigerians, which has painfully been hijacked by a few privileged elements in and around government circles, leaving the majority to wallow in abject poverty as a way of life.? For now, the fury and the sounds of subsidy continue to resonate albeit tacitly.