Yemisi Izuora
BudgIT is seeking accountability and transparency on the part of the Federal Government and the Nigerian National Petroleum Corporation (NNPC) on the amount spent on subsidy in 2016, 2017 and the first quarter of 2018.
The body insists That it will be in the interest of the public that detailed information of the amount spent on fuel subsidies such as the beneficiaries, the pricing template for arriving at the subsidy rates and the volume of petroleum products utilised should be made open and that these transactions are carried out transparently.
The Minister of State for Petroleum Resources, Ibe Kachikwu, recently disclosed a total of N1.4tn is being spent annually by the Nigerian National Petroleum Corporation (NNPC) as the subsidy for Premium Motor Spirit (PMS). This amount is significantly more than what Nigeria intends to spend on Education in the proposed 2018 Budget (N605.8 bn).
There is a growing deficit in trust due to lack of due process in the NNPC; in March 2018, the corporation announced it spends N774m daily, roughly N23.99bn monthly as subsidy on 50 million litres of PMS consumed across the country. The public knows very little information on the beneficiaries of the subsidy payments and control process instituted to prevent theft of these funds.
BudgIT notes that the subsidy payments have been a contentious issue for the last 30 years. Analysts have called for its cancellation due to the lack of accountability and transparency in the administration of these funds. Also, there are arguments that the subsidy regime constituted double taxation on the populace who pay the actual market price for PMS due to lack of adequate monitoring by the Department of Petroleum Resources (DPR).
According to our Lead Partner, Oluseun Onigbinde, “Evidence shows that amount spent on subsidising PMS is always riddled with corruption. We noted this is 2011 prior to the elections and we are worried this opacity is preceding the 2019 elections again. We are worried at the use of public resources without legislative appropriation or requisite transparency ”
BudgIT understands that NNPC in recent times has initiated a couple of actions in trying to meet up with the global of standards of transparency and accountability including actions like publishing its monthly report on its financial and operational activities. Notwithstanding this, the lack of information on the subsidy regime, including the amount paid and the beneficiaries are locked away from public scrutiny.
Therefore, BudgIT urges the Federal Government, NNPC, DPR, National Assembly, the National Economic Council (NEC) and State governments to release details on the breakdown of the amount spent on subsidy, the beneficiaries, the pricing template for arriving at the subsidy rates and the volume of petroleum products utilised.
For increased efficiency of the NNPC, there is an urgent need to plug the loophole created by the subsidy regime in the oil sector; we call on all Nigerians to demand appropriate systems to ensure that oil revenue is judiciously managed and utilised for the good of the people.