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NNPC admits there is Confusion in Govt circles over Subsidy

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NNPC admits there is Confusion in Govt circles over Subsidy 

***refutes Senate panel’s claim on 4tr non-remittance to Federation account

The Nigeria National Petroleum Corporation (NNPC) has admitted that an implied Petroleum Subsidy which Government is still shouldering has gulped an accumulated 4trillion it is being accused of not remitting to the federation account.

To this end the chief financing officer of the corporation Umar Ajiya also agreed that there is confusion within Government circles at the moment for which a lot of consultations are ongoing on how to handle the implication of sustained subsidy.

Umar was responding to a query by the auditor General of the Federation over alleged unremitted N4 trillion by the corporation into the federation account.

The senate Committee on public accounts had relied on the 2016 report of Auditor General of the Federation which accused the NNPC of non-remmittance of N4 trillion into the Federation Account.

The Query as read by the auditor general Aghughu Adolphus Arhotomhenla through his representstive Olutoye Agesin stated “It was observed upon scrutiny of NNPC report to the Technical Sub- Committee of Federation Account Allocation Committee meeting held in December 2016 that a cumulative total of N4,076,548,336,749.75 remained unremitted to the Federation Account by NNPC as at 31st December 2016.

“The total revenue unremitted as at 1st January 2016 (see the table above) from amounts payable into the Federation Account by NNPC was ₦3,878,955,039,855.73 was.

“The sum of N1,198,138,355,860.30 was due in revenue to the Federation Account out of the total generated in 2016, however, NNPC paid the sum of N1,000,545,058,966.20

resulting in an amount withheld of N197,593,296,894.02. This brought the total amount withheld by NNPC from the Federation Account as at 31 December 2016.”

The auditor general therefire ordered the GMD of NNPC to remit all amounts due to the federation account, improve on the record of remittances of proceeds to the federation account and pay interest on the amount unremmitted.

Explaining further the position of NNPC Ajiya said 

“This has to do with the domestic crude that the NNPC takes in order to refine and sell products or takes to exchange and bring product into the country and side by side the Government has also fixed the price for PMS and that entails the accumulation of subsidy. “This issue has been reoccurring for years even now it’s a topical issue in the Government circles, a lot of consultations are ongoing because at the moment there is also more or less an implied subsidy as a result of the local consumption. 

“What has happened in the past is that NNPC based on appropriation, and also appropriation for pipeline and security cost and maintenance had been deducting these sums before remitting balances to the Federation account. 

“It became a turbulent issue to the extent the Governors also got involved and they commission forensic audit by PPMC. The forensic audit has been done, the auditor general has a copy of the forensic audit. 

“At the end of the day that forensic audit established that NNPC was owing about N797b but also on the other hand the federation was also owing NNPC, the net effect was that the NNPC was being owed N239bn, so there is nothing like N4tr withheld by NNPC.”

He said the books are with the CBN, adding that they can’t hide N4tr anywhere. 

He said the said amount of over N4tr has gone through the consumption of PMS and that is why everybody has to be involved with respect to deregulation.

Senators who are also members of the committee could not understand how the NNPC would just wave off the allegation with the subsidy alibi.

Senator Ayo Akinyerule said the question by the auditor general is clear saying the answer to the query should be backed by documents

“Is that the response you can give to these questions fir those of us who are not part of your management? Only two lines response is not adequate for this committee.

“We expect you to provide details as subsidy payments, pipeline repairs and management of crude oil and arrive at a figure whether NNPC is owing or it is federation account that is owing. This answer is not acceptable.

“We believe you should take us seriously at this end there should have been proper computations on how they arrived at the N4tr and your defense to nollify it is not available to this committee.

The deputy chairman of the committee senator Ibrahim Hadejia in his concluding remarks stepped down the query and asked him one week   for the NNPC to supply documents to back his response

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Legislature

National Food reserve Agency Bill scales through amidst opposition at senate

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National Food reserve Agency Bill scales through amidst opposition at senate

The Senate, on Wednesday, passed a bill seeking to establish the National Food Reserve Agency for Food security despite disagreement over its powers by senators.

Before the bill was passed, senators engaged in a heated debate over the powers of the National Assembly to legislate on the establishment of the agency. 
However, the Bill saw the light of day when the President ruled in its favor..

The bill was passed after the Red Chamber considered the report of its committee on Agriculture and Rural Development.

The Chairman of the committee, Senator Senator Abdullahi Adamu, in his presentation, said, when established, it is expected to implement the overall National Food Reserve Policy to ensure a reliable supply of designated commodities in the country
He said with the existence of the agency, emergency food crises will be taken care of especially during the period of pandemic.

“There will also be a reduction in post-harvest losses as silos, warehouses, equipment, ancillary facilities and other suitable storage facilities will be installed and maintained,” he said.

Senator Ajibola Basiru (APC, Osun) had raised a constitutional matter that the National Assembly did not have the power to legislate on the establishment of the food reserve agency, citing section 4 of the 1999 constitution to back up his argument.

But Senator Aliyu Sabi Abdullahi (Niger), Ibrahim Gobir (Sokoto) and Adamu Aliero (Kebbi) countered Bashiru’s submission, arguing that the federal parliament is constitutionally empowered to legislate on matter of security and welfare of the people.

They said the agency was needed owing to the acute insecurity across the country, which has had effect on food production.

Senator James Manager (Rivers) said though there is need for the agency due to the situation in the country, sentiments cannot counter effectively the constitutional matter raised by Ajibola Basiru. 

He asked his colleagues to step down the 
the consideration of the report to another legislative day.

But Senate President Ahmad Lawan disagreed and ruled that the Red Chamber should go ahead with the legislation.

Lawan said: “From a constitutional point of order our colleague raised that we don’t have such power, I think the National Assembly has such powers. I think the emergency in this country requires that we do everything possible to rescue, protect the lives and property of the people of this country.

“I believe we should go ahead to do our legislation.

“If anyone outside feels that the legislation is wrong, that person can go to the court so that the legislation is nullified and that is one thing with the practice of democracy.

“But I believe that Nigerians at the moment need this kind of legislation.”

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Legislature

N7.5B secret withdrawals: Senate Summons Finance Minister, AGF

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N7.5B secret withdrawals: Senate Summons Finance Minister, AGF

Senate Committee on Public Accounts has summoned the Minister of Finance, Ahmed Zainab and Accountant General of the Federation, Ahmed Idris over secret withdrawals of N7.5 billion from the 2 percent National Automotive Design and Development Council Levy Account domiciled with Central Bank of Nigeria (CBN).
The report indicated that first N3.8 billion was withdrawn in two installments of N2.8 billion in 2005 and N1 billion in 2006.
This was containwd in the report of the Auditor-General of the Federation, which is being considered by the Senate committee, chaired by Senator Matthew Urhoghide.
The second N3.7 billion, the report said, was withdrawn between March – December 2000 in three separate payments of N725 million, N1 billion and N2 billion.
When the Committee asked the Director General of National Automotive Design and Development Council
Jelani Aliyu about the withdrawal, he said the money was withdrawn without the knowledge of the agency.
He said the Agency has been writing to the Accountant General and Ministry of Finance on the need to refund the money but there was no response.
Apparently piqued by the development, Senate Committee on Public Accounts resolved to summon the Minister of Finance and Accountant General of the Federation to give explanation on the fund.
The query reads,”A total sum of N3,836,000,000.00 (Three billion, eight hundred and thirty-six million naira) was irregularly withdrawn from the 2% National Automotive Council Levy Account with the Central Bank of Nigeria, Abuja in 2 installments of N2,800,000,000 (in 2005) and N1,036,000,000.00 (in 2006) by the Accountant-General of the Federation and the Federal Ministry of Finance as car loan to be granted for the Security Personnel Car Purchase Scheme Loan.
“The transaction was carried out by the Presidency in collaboration with the Bank of Industry, the Federal Ministry of Finance and the Accountant-General of the Federation without the involvement of NAC, the account owner.
“However the principal and the accrued interest from the fictitious loan have not been paid back nor are records available on the beneficiaries, agreement documents, moratorium, duration of the loan, the yearly interest rates accruable and how the fund will be paid back by the beneficiary.
“The Director General has been requested to intensify correspondence with the Honourable Minister of Finance, Accountant-General of the Federation and the Presidency to recover the fund (‘loan’).”
On the 3.7 billion, the report said the sum was “irregularly withdrawn from the 2% National Automotive Council Levy Account with the Central Bank of Nigeria between March-December 2000 in 3 separate payments of N725,000,000; N1,000,000,000 and N2,000,000,000 as ‘loan’ to NAFCON vide the Accountant General of the Federation internal memo to the Permanent Secretary, Budget Office of the Federation Ref No: DD/(R&F)22.Vol. 1158 of 27/5/2003.
“The ‘Loan’ Principal and the accumulated interest are yet to be paid since the year 2000.”

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Legislature

Senate Urges NEMA to Provide Relief Materials to Benue Windstorm Victims

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Senate Urges NEMA to Provide Relief Materials to Benue Windstorm Victims

The Senate on Wednesday urged the National Emergency Management Agency (NEMA) to as a matter of urgency mobilize resources and rehabilitation materials for various communities in Benue state recently affected by a devastating windstorm.

The disaster had destroyed hundreds of buildings, leaving many residents injured and homeless.

The upper legislative chamber also urged relevant government agencies to support the rebuilding of all the affected public buildings.

It further urged relevant government agencies to go to Benue south senatorial district to sensitize the people on measures to protect themselves and their properties.

The resolutions were sequel to the adoption of motion, sponsored by Senator Abba Moro (Benue South).

Moving the motion, Moro expressed sadness at the extent of destruction inflicted on lives, public and private properties by a windstorm which swept through Ogbadibo and Okpokwu communities in Benue.

He lamented that the windstorm brought down blocks of classrooms in some schools, churches, police station and many other buildings were affected.

Moro said, ”On April 8 2021 about ten communities in Benue state were badly hit by natural disaster. A devastating windstorm which left scores of people injured, hundreds of them homeless and wanton destruction of properties, valuables and several means of livelihood worth millions of Naira.

”Recall that on May 12, 2020 I drew the attention of the Senate in a motion over a devastating rain, windstorm disaster that swept through Ai-Famu, a community in Owukpa, Ogbadibo LGA of Benue State, wherein over 150 buildings including St. Michael The Archangel Catholic Church’s building were blown up by the storm. Worried that almost one year after the disaster, the ordeal has repeated itself in a worse and more devastating manner.”

He added that the situation needs to be addressed to provide succor to the affected communities and persons.

In his contribution, Senator Micheal Nnachi called for urgent action to safeguard the lives and properties of citizens.

He said, ”Climate change is a serious issue in every country in the world, this motion has caused a lot of havoc in his senatorial district. Today people are under the sun, under the next rain which we may not predict. Something urgent should be done to protect the lives of these people.”

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