Editor’s note: When there is oil, there is money. When there is money, there always are fears that fraud and stealing would start sprouting from the highest levels of the governments. That is why Legit.ng’s columnist Ibraheem Dooba says Ngozi Okonjo-Iweala, Nigeria’s finance minister, owes a thorough explanation regarding what (or whom?) at least 30 billion of naira have been spent on in the past couple of years.
The views expressed in this article are author’s own and do not necessarily represent the editorial policy of Legit.ng.
Dr Ngozi Okonjo-Iweala, finance minister and (as she insists to be called) coordinating minister of the economy, used to be advertised as one of Nigeria’s best. Today, many Nigerians beg to differ.
In an opinion piece published on May 28th, the day before Muhammadu Buhari’s inauguration, Adams Oshiomhole, the governor of Edo state, raised some important questions as regards the minister’s tenure. This writer stands united with Gov Oshiomhole and wants Dr Okonjo-Iweala to answer the following questions:
When did you know that petroleum marketers' claims were fraudulent?
The popular saying among Nigerians now is "the fear of Buhari is the beginning of wisdom". That’s probably due to the fact that many government functionaries are trying to put their acts in order so that the infractions of the past wouldn’t be found out.
Using the same script, in the wake of the unprecedented total blackout of Nigeria due to energy crisis, Dr Okonjo-Iweala told Nigerians that she declined to pay petroleum marketers’ fraudulent subsidy claims because she wouldn’t allow them to cheat Nigeria. The logical questions follow: seeing that these marketers have been paid subsidy for many years, is it now that they are learning to be fraudulent, or have they been fraudulent all these years? If so, why did you pay them in the past and chose not to pay now?
Gov Oshiomhole asked the question eloquently:
“How come that it is now, for the first time, that we are hearing from the minister of finance about fraudulent claims by the oil marketers amounting to billions of naira? At what point did the minister of finance and CME realise that these fraudulent and similar claims are going on? When did it start? Is it just recently or it has been going on all along? These questions are pertinent because we know that if the Petroleum Products Pricing Regulatory Agency (PPPRA) were doing its work diligently, all claims by oil marketers would be vetted on a daily basis before the ministry of finance processes their payments.”
We want to know the ugly details of SURE-P funding and spending
When subsidy was partially withdrawn in 2012 and SURE-P was created, the agreement was that SURE-P would be funded with the difference between the new and old price – hence, its name: The SUbsidy REinvestment Programme, a la Abacha’s Petroleum Trust Fund: the PTF.
However, the minister told us a few days ago that the federal government used the Excess Crude Account (ECA), owned by all the tiers of government (federal, state and local) to fund SURE-P. This means the ECA, where Nigeria puts its oil money earned that’s in excess of the budgetary benchmark, was used illegally by Dr Okonjo-Iweala and then-President Jonathan for the purposes it was not designed to serve. This was done without the approval of other tiers of government and without authorization from the National Assembly. It escaped Dr Okonjo-Iweala that you can’t spend that much without appropriation from the National Assembly.
On this, Gov Oshiomhole wrote:
“And with regards to funding subsidies and SURE-P from the ECA, there was no indication anywhere that NASS [National Assembly] authorised the use of the ECA for that purpose. The amount in question is also evidently far in excess of what the country can consume on petroleum products, even if every Nigerian is a consumer of petroleum products.”
Where’s 0ur $26 billion dollars?
By December 2012, Nigeria had $10 billion in the ECA. The minister dodged the National Economic Council (NEC) during the first six months of 2013. By the time she turned up, $6 billion dollars had disappeared from ECA, leaving only $4 billion. According to Gov Oshiomhole’s calculations, if the oil boom years between 2011 and 2014 are considered, the ECA should have $30 billion. If you remove $4 billion the minister claimed the FG shared with the state governments, we still have $26 billion unaccounted for.
Gov Oshiomhole stated:
“If the closing balance of the ECA as at December 2012 was over $10 billion and that for three years running Nigeria’s budget have been based on the average of between $77 and $79 benchmark while the average price of Nigeria’s crude has been $108 per barrel, suggesting an average of about $30 per barrel, how come that there was no accretion to the ECA? Indeed, based on a rough estimate, we should be expecting not less than $30 billion accretion based on the official oil exports of 2.3 million barrels per day.”
All considered, I agree with Oshiomhole’s conclusion:
"There is too much of secrecy surrounding the management of our public finance. The earlier the finance minister comes clean on the management of our financial resources, the better for all of us, so that the incoming government will derive the baseline from which to launch its economic recovery strategies to combat our present morass."
Follow Dr Dooba, data scientist, teacher and columnist, on Twitter, or email him at email@example.com.