Being text of a press conference addressed by Save Nigeria Group (SNG) on the Report of the House of Representatives Probe of the Subsidy Reforms in Nigeria, on Monday April 30, 2012.
Gentlemen of the Press,
You are welcome to this press briefing by the Save Nigeria group (SNG) on what a news magazine has rightly called “A DIARY OF EXECUTIVE THEFT”.
The report of the House of Representatives ad.hoc Committee on the management of Petroleum Subsidy revealed an organised banditry which, in the words of the Lawan Farouk Committee, “can hardly be rivalled in the history of a warped budget management of any nation anywhere in the world”, has reinforced our position in January that the crisis in the oil industry in Nigeria is not about subsidy but corruption. The Committee said the following, and we fully agree: “We found out that the subsidy regime as operated between the period under review (2009 and 2011) were fraught with endemic corruption and entrenched inefficiency. Much of the amount claimed to have been paid as subsidy was actually not for consumed PMS. Government officials made nonsense of the PSF Guidelines due mainly to sleaze and, in some other cases, incompetence. It is therefore apparent that the insistence by top Government officials that the Subsidy figures were for products consumed was a clear attempt to mislead the Nigerian people”.
Every line in the Committee’s report is a poignant statement on the culture of official corruption in Nigeria. However, for the purpose of this briefing, we are highlighting the most tellingly embarrassing aspects of the book of larceny.
HOW DID WE SPEND THREE (3) TRILLION NAIRA IN ONE YEAR?
The report showed that the budget expenditure on subsidy for both PMS and HHK in 2006 was N261. 1b, N278.8b in 2007 and N346.7b in 2008 and N245 b for 2011.
The tables below show subsidy payments in the five years preceding 2011:
PPPRA Report To NASS-October 2011.
2007-278.9 billion Naira
2008-630.6 billion Naira
2009-421.6 billion Naira
2010-673.0 billion Naira
KPMG’s Final Audit Report- May 2011.
2007-272 billion Naira
2008-688 billion Naira
2009-384 billion Naira
Though it is curious from the above figures how the subsidy payments dropped in 2009 by about N200b only to rise by the same quantum in 2010, this is inconsequential compared with the humongous bill of 2011.
The Petrol Armada of 2011 was not only about the number of companies involved, but more on the amount of money stolen in the name of subsidy. Quoting the report: “…contrary to the earlier figure of subsidy payment of N1.3 trillion, the Accountant-General of the federation put forward a figure ofN1.6 trillion, while the Committee established subsidy payment of N2.587.687 trillion as at 31st December 2011, amounting to more than 900% over the appropriated sum of N245 billion…..There were outstanding claims by NNPC and the marketers in excess of N270 billion as subsidy payments for 2011”.
We now know that between January and February 2012, another N340 billion has been withdrawn as arrears of 2011 subsidy. When these figures are put together, it can be seen that what was stolen in the name of subsidy in 2011 alone is about three-quarters of the entire Federal Appropriation of 2012. The report did well by putting a lie to the claim by the Budget Office and Minister of Petroleum Resources that the gap was due to “assurances that deregulation would take effect on the first quarter of 2011”. This is a fraudulent claim according to the committee which says it “was not only contradictory but also an after-thought. The time limitation was not expressed or implied in the Appropriation Act of 2011. Furthermore, the Appropriation Act of 2011 was amended in May of the same year and there was no request from the Executive for an increase in the subsidy figures”. Could it be that there was a sudden prosperity in Nigeria in 2011 which led to sudden increase in the purchase of cars demanding massive importation of fuel? The answer is NO as the year actually witnessed depletion in the purchasing power of Nigerians as official statistics put the figure of the dirt poor at 71.1% of the population.
That what we are dealing with is organised banditry is underscored by the fact that virtually every organ of government that has anything to do with fuel importation was indicted - including external auditors. It would have been impossible to carry out this horrendous haemorrhage on our treasury if it was not sanctioned from the highest levels. Note the following:
1) The theft of N310 billion by NNPC on kerosene subsidy in spite of an official policy against paying subsidy on the product.
2) Another theft by NNPC of N285b above PPPRA recommendation.
3) An NNPC self-discount of N108b.
4) The sum of N8b through marketers in total violation of the PSF Scheme.
5) Payment of N999m in 128 times within 24 hours to some companies totalling N127.872b by the office the Accountant-General of the Federation.
6) Companies who collected forex to the tune of $402.6 million whose utilization is unclear.
7) 72 companies that are indicted in the forensics with over N230b against their names.
8) The over-recoveries of N2.766b and N5.276b which were not accounted for by the office of the Accountant General of the Federation.
9) The cases of double deductions by the NNPC for subsidy payments in 2009, 2010 and 2011.
10) About 20 companies getting allocations to import fuel before they were registered with PPPRA.
11) A 24 million litre gap between the volume of import and actual consumption.
12) The virtual discount of the 53% capacity of the refineries in a bid to promote 100% import level for our fuel consumption.
13) The 210,000 barrels per day the NNPC allocates to swap/off shore price out of its 445,000 barrels of crude allocated daily is not reflected in its differential claims to subsidy.
These among other acts of economic sabotage identified by the committee all add up to show that corruption has become official in the transaction of government business.
NOW THAT THE HOUSE HAS ADOPTED THE REPORT
We commend the House of Representatives for its painstaking consideration and adoption of the report in two days with some amendments. This shall go down in history as one act of redemption by a chamber of the National Assembly that has not done much since 1999 to endear itself to the people it represents.
We are glad that the Speaker of the House of Representatives Hon. Aminu Tambuwal spoke our minds to the anti-graft agencies which had earlier said they would be waiting for a harmonised version of the report before taking action: “Let me quickly say here that this is at best an excuse that cannot stand, after all the same agencies accept and investigate petitions from individuals, how much more resolutions of the House” he said.
That settles the question of what is to be done.
FUNDAMENTAL ISSUES SNG WANTS THE NATION TO TAKE NOTE OF
Having gone through the report and followed keenly the debate in the House of Representatives, there are fundamental issues we at SNG are putting on the table the resolution of which will get to the root of this grand collusion to milk the nation dry:
- The management of NNPC has denied that it did not receive the payment of N1.329 Trillion the report said was paid to it by the Central Bank of Nigeria. This has compelled the executive councils of NNPC NUPENG and PENGASSAN in an advertorial in This Day of April 26, 2012 at Page 44b to demand that a critical inquiry be launched by the relevant agencies “ including the NLC, TUC, security agencies to take this issue seriously and demand full disclosure of whether the said amount was ever paid ,to whom and for what purpose”.
This is very germane as there is nobody that answers the name NNPC.There must be names of persons who authorised these payments and those who received them. We must fish them out and they must tell us where the money ended and for what purpose. It may just be that cheques were written by higher authorities in the name of this agency and some officials used to cash such and funnelled into slush funds in the order of “PTDF” of Obasanjo and Atiku days.
- The clearance of Gombe Governor,Alhaji Ibrahim Dankwanbo who was the Accountant General of the Federation in 2009 and who was alleged to have issued cheques of N999m in 128 places in 24 hours totaling N127b raises another serious matter. Passing the buck to PPPRA does not answer the issue. The impression this gives is that the Governor may have been exonerated in a deal to ensure that he does not spill the beans if push comes to shove. These dubious payments must be traced and the nation must know where the money ended.
- A great number of the indicted subsidy scammers are members of the ruling party and or businessmen who have over the time been billion donors at PDP fundraisers. There must be a thorough investigation of the possible connections between their dubious subsidy payments and the donations they make to the ruling party.
- President Goodluck Jonathan has played the ostrich by saying that no one indicted would be spared. That is fine for as long as that includes his oil Minister (Mrs Diezani Allison-Maduekwe) and all the three ministers of Finance in the period covered by the report (Alhaji Mansur Muhktar, Mr Olusegun Aganga and Dr Ngozi Okonjo-Iweala).We have no doubt in our minds that all the lesser officials in the NNPC, PPPRA etc; whom they want us to focus on were mere chattels in a web of a big conspiracy at the highest level of governance to steal our country broke. Those officials must be punished for their roles as well but they cannot be scapegoats for the big masquerades!
But is the commander-in- chief saying no one would be spared except himself? At the core of this horrendous heist is the violation of budget management for which the President carries the responsibility. Any President who says he is not aware of the theft of N3trillion Naira for an item for which only N245 Billion was budgeted is not fit to hold office. That the President presented a supplementary budget in May, 2011 without asking for more money on subsidy is clear evidence that he cannot say he was not in the know of over 1100% fiscal roguery on the budgeted sum and this is a clear breach of his oath of office. In this regard, we agree with the House recommendation of the need for the criminalisation of budget overspend but we demand that it should not be in the future but to start now with this subsidy scam. The constitution is clear on this breach.
By the provisions of section 80 and 81 of the 1999 constitution which relates to the powers and controls over public funds by the President, it is clear that these sections have been breached by the actions or inaction of the president. This amounts to gross misconduct as construed in Section 143 (2) (b) and Section 143 (11) which places a responsibility on the National Assembly to determine whether the actions or inactions of the President are not sanctionable under these provisions.
Constitutional Provisions on Powers and Control over Public Funds
Section 80. (1) All revenues or other moneys raised or received by the Federation (not being revenues or other moneys payable under this Constitution or any Act of the National Assembly into any other public fund of the Federation established for a specific purpose) shall be paid into and form one Consolidated Revenue Fund of the Federation.
(2) No moneys shall be withdrawn from the Consolidated Revenue Fund of the Federation except to meet expenditure that is charged upon the fund by this Constitution or where the issue of those moneys has been authorized by an Appropriation Act, Supplementary Appropriation Act or an Act passed in pursuance of section 81 of this Constitution.
(3) No moneys shall be withdrawn from any public fund of the Federation, other than the Consolidated Revenue Fund of the Federation, unless the issue of those moneys has been authorised by an Act of the National Assembly.
(4) No moneys shall be withdrawn from the Consolidated Revenue Fund or any other public fund of the Federation, except in the manner prescribed by the National Assembly.
Section 81. (1) The President shall cause to be prepared and laid before each House of the National Assembly at any time in each financial year estimates of the revenues and expenditure of the Federation for the next following financial year.
5. The recent external auditors reports on the accounts of political parties for year 2010 released by the Independent National Electoral Commission (INEC) revealed that the PDP could not give its account. Given the undue use of money in the 2011 elections by the ruling party to the extent that local and foreign currencies were alleged to have been doled out to delegates at its presidential primaries at Eagles square, we must compel the ruling party to open its books for investigation as subsidy funds may have gone to unsavoury places.
6. The House of Representatives found in respect of the 445,000 barrels a day, that the NNPC produced the following based on its 53% local refining capacity and 47% SWAP/Offshore arrangement;
(a) 40 million litres per day of PMS
(b) 10 million litres per day of Kerosine
(c) 8.97 million litres per day of Diesel
(d) 0.62 million per day of LPG and
(e) 2.31 million per day of FO
The implication of this is that if the NNPC has been meticulous with the management of the 445,000 barrels of oil per day, there would not have been any need to import oil. This is because the corporation would have produced 5 million litres of oil in excess of the 35 million litres of PMS consumed daily.
Given these findings, the Federal Government has to explain the justification for the N888Billion budgeted in the 2012 budget when we may actually have enough products for our local needs.
THEY STOLE US BROKE
A serious fall- out of this mindless looting is that the country has been stolen broke. The Minister of Finance, Dr Ngozi Okonjo-Iweala recently told the nation that the excess crude account is down from $20Billion to $3.6billion.As we address you at the end of April the states are yet to receive their allocations for the month of March because the treasury is empty.
This is a serious warning crisis of an imminent collapse of the economy with no evidence that the government is doing anything to salvage the situation.
Rather what we are seeing is that those whose fingers are being proverbially chopped for corruption are still acquiring diamond rings. An open letter to President Jonathan byFitch, Fitch, Fitch and Associates at The Hague, Netherlands on behalf of Transparency International says it all:
“The problem, Your Excellency, has to do with the rate and scale of scams and corruption probes coming out of Nigeria in 2012.The scope and speed of corruption in your country this year is beyond anything our client has ever dealt with.
When the pension scam broke out, the three specialists working on Nigeria complained about overwork and threatened a law suit against Transparency International because they had to work 23 hours a day from Monday to Sunday just to cope with the figures coming out of that scam. Our client had to pull country specialists away from zero or low corruption countries such as New Zealand, Denmark, Finland, Sweden, Singapore, Norway, Netherlands, Australia, Switzerland, and Canada. The specialists working on all these countries were transferred to the Nigerian Desk”
PANICKY MEASURES WON’T POSTPONE DAY OF RECKONING!
Like the way a transgressor runs when no one pursues him, the Jonathan administration recently rolled tanks to the Gani Fawehinmi Freedom Park at Ojota where Nigerians gathered in millions in January to assert their dignity as a people. This is at best a panicky response by those who have cornered our collective patrimony and are scared of the questions we shall be asking. The regime portrays itself in a comical light to think that Ojota is the only space in Nigeria where the people of Nigeria can express their anger peacefully against the brigade of thieves running our country through open theft of our money. More importantly, the knee jerk pre-emptive action is the thermometer with which its democratic temperature is to be gauged by the whole world.
Now is the time to act to save our country from the grip of corruption. To this end, we are giving two weeks to see concrete steps in the direction of prosecuting the indicted officials failing which we shall be calling our people out on protest.
Given the low confidence the people have in the anti- corruption agencies in dealing with political corruption in Nigeria, we are demanding the appointment of a private prosecutor to deal with these prosecutions.
The counsel to be so appointed must be a man or woman of proven integrity with a team of Lawyers recommended by the Nigerian Bar Association working with such private prosecutor. Civil society organisations should also be allowed to appoint their own counsel as observers.
DO NOT FLINCH!
Our message to our country men and women is that they must be strong hearted and determined to take back our country. If our people realize what N3 trillion can do in the life of a nation, it would not be difficult to understand why we must kill corruption lest it kill us all as it is systematically doing already. We have nothing to lose but our chains as we embark on this patriotic and just resistance against the destroyers of our nation. All we must be ready to do is to assert our collective dignity and let our “leaders” know that we are better than their animals.
For in the words of Dr Patrick Wilmot “Many Nigerian politicians, especially those with a military background possess modern farms where they raise livestock. They provide nutritious food, clean water, sanitary housing, the latest medicine and the best sanitary services. They have interest in the welfare of their animal because they want to make profits. If they have the same interest in their citizens, Nigeria would be a far better place and 70% of the population would not be classified as dirt poor”
This is a decisive moment in our history to assert our humanity and restore our dignity as a people. Enough is enough!
Thank you all.