18 November 2015, Abuja – The two arms of the National Assembly have said that they have not received any proposal from President Muhammadu Buhari on the payment of N413bn subsidy arrears to marketers by the Federal Government.
This is, however, contrary to the claims by the Minister of State for Petroleum Resources and Group Managing Director, Nigerian National Petroleum Corporation, Dr. Ibe Kachikwu, who said on Tuesday that the Senate President, Bukola Saraki, had received a letter from the President seeking the National Assembly’s approval for the payment of the N413bn to the marketers.
Leaders of the majority All Progressives Congress and the main opposition Peoples Democratic Party confirmed to The PUNCH in Abuja that as of Tuesday, no proposal had reached the House of Representatives
Also, the Senate said it had not received the President’s request on the fuel subsidy payment.
However, Kachikwu said, “The President has approved the payment for the marketers but realised that there’s a procedure that requires that the approval has to go to the National Assembly. The President has written to the National Assembly. I have had the opportunity to talk with the Senate President, he is working with his team to ensure that something is done about that. It is all part of the process and the process is going to be followed.
“But I’ve assured the marketers that they are going to get their money. I’m sure that within the next one or two weeks, once we finish with the Senate, this will be done. But the President is looking at shorter ways to intervene. Once we get the Senate concurrence, even if the extra-budgetary approval hasn’t come, the President will authorise the Central Bank of Nigeria to release the fund.
“So we’ve made provisions for the money; we’ve got the approval out of the executive, but we require a process of going through the legislature. We just don’t spend money that way, we are a process-driven organisation and country. So, that’s what is happening. Therefore, patience does it. Marketers, with the assurance I’ve given, are beginning to bring in products and I expect the queues to end in a matter of days.”
According to him, the non-payment of the subsidy claims is responsible for the scarcity of Premium Motor Spirit or petrol being experienced in most cities across the country as many marketers have stopped importing refined products.
However, the House Majority Leader, Mr. Femi Gbajabiamila, told The PUNCH that no such proposal had been received by the House.
He stated that it was possible that the Presidency was contemplating sending the proposal in the form of a supplementary budget, but had not done so as of Tuesday.
“I am assuming this will come as a supplementary appropriation. I have not seen any such bill and nothing like that has been laid on the floor of the House,” Gbajabiamila added.
The Minority Leader of the House, Mr. Leo Ogor, also corroborated Gbajabiamila’s position.
Ogor noted that there was a difference between planning to do something and “going ahead to actually do it.”
He stated that a proposal on subsidy as huge as N413bn would not be presented to the National Assembly in secrecy.
He also queried the sources of funding of the proposal at a time that the country was going through financial stress owing to the crash in the global prices of crude oil.
“N413bn is not N4,000. Where will the President even get the money to pay such a huge amount to fuel marketers? Are we truly funding subsidy or some other expenditure that we cannot explain? This is the reason we should seriously be considering the option of removing subsidy entirely,” Ogor said.
The Senate spokesperson, Senator Aliyu Abdullahi, said that the red chamber had yet to receive any communication regarding the supplementary budget meant for the payment of the subsidy claims from Buhari.
Abdullahi, who spoke with journalists after plenary, however, explained that the Senate would give the communication accelerated consideration once it was received.
This is coming as the government also revealed that it was looking at fuel price modulations, adding that it was obvious that the subsidy regime could not be sustained.
Kachikwu disclosed this in Abuja on Tuesday after visiting different petrol stations in the city to ascertain the level of the fuel scarcity.
The minister explained that the Federal Government was working on long-term plans with respect to the supply of petrol across the country.
“We’ve got to look at the pricing dynamics and see how we can sustain supply in this current environment. We’ve got to look at whether we have enough budgetary provisions to deal with these issues. But I’m working very closely with the President; like you know, he’s the one in charge of this ministry and takes very direct interest in it, and we are going to find solutions to the problem,” he said.
When asked if the government was contemplating reducing the pump price of petrol, the minister said there was no such a plan.
He added, “I can be very clear; there is no reduction whatsoever. Frankly, sustaining subsidy based on the rate that we have now is a major problem for the country and is only happening through the magnanimity of the President. We are looking at the price modulations.
“By January, we will have a price modulation dynamism that will enable us address the critical issues with the marketers. But the issue of price reduction is not on the horizon at all.”
He explained that the delay in the release of funds for the payment of subsidy claims had made a lot of the marketers not to bring in products, adding that the NNPC had been the one meeting the country’s entire demand, whereas it should be doing 50 or 55 per cent.
Kachikwu said, “But I think this will go away because I’m getting all the majors to get involved. I’m instructing that the majors must take charge of their stations. We are working to ensure that some of the rules are relaxed so that they can bring in products and deliver.
“Currently, there is enough supply within our facilities. Some of the pipeline issues are being addressed, but we are moving trucks massively. Yesterday (Monday), over five million litres were moved; today, (Tuesday) we are doing the same thing and most of the stations in Abuja have products right now.
“So I’m instructing most stations to stay open for 24 hours, the police will provide protection for them. I’m expecting majors to move in and supply products and take responsibility for their own filling stations as we are taking responsibility of our stations at the NNPC and our retail outlets.
“I’ve also instructed the Department of Petroleum Resources that any station that has product and its people are hoarding, they should sell all the products in that station for free to the masses and we are going to impose very serious penalties on such outlets. Sealing them is not the answer, it is penalising them for such acts.”