19 November 2014, Sweetcrude, ABUJA – After several months of dispute and controversy, the Nigerian National Petroleum Corporation has begun refunding parts of the over N1.4 trillion unremitted funds to the Federation Account.
The National Assembly had last June ordered the Corporation to remit the sum of $927,887,238.32 (N148,461,958,131.20) to the Federation Accounts being shortfalls in their crude oil transactions on behalf of Nigerian federation.
The Minister of State for Finance, Mr Bashir Yuguda, on Tuesday announced that the sum of N6.33 billion refunded by the oil and gas behemoth was part of the N593.33 billion revenue that accrued to the nation in October, and which was shared among the federal, states and local governments.
Yuguda made this known in Abuja when he briefed newsmen on the outcome of the Federation Accounts Allocation Committee (FAAC) meeting.
The shared amount, Yuguda said, comprised statutory revenue of N484.32 billion, N35.55 billion Subsidy Reinvestment and Empowerment Programme (SURE-P) funds and N6.33 billion refunded by the Nigerian National Petroleum Corporation (NNPC). The other component of the money is Value Added Tax (VAT) amounting to N67.14 billion.
The Sen. Ahmed Makarfi-led Senate Committee on Finance that investigated the NNPC over allegations of fraud leveled against it by the suspended Governor of the Central Bank, Mallam Lamido Sanusi, in June, had ordered NNPC to begin remittances of billions of dollars to the Federation Account.
The report indicted NNPC for withholding US$218,069,354.32 (N34,891,096,691.20) being Federation Account share from the “Third Party Financing” and US$262 million (N41,920 billion), being expenses it could not satisfactorily defend in respect of Holding Strategic Stock Reserve, Pipeline Maintenance and Management Cost, and Capital Expenditure.
Also, the NPDC is to remit to the Federation Account US$447,817,884 (N71,650,861,440) being balance of Royalty and Petroleum Profit Tax (PPT), which they failed to remit. The Committee further recommended expeditious passage of the long pending Petroleum Industry Bill (PIB).
The Committee also recommended that NNPC should not pay their operational expenditures direct from the Federation fund without appropriation by NASS, and that it should not control the revenue account of NPDC in order not to undermine its separate legal status and make accountability more difficult.
Furthermore, the Committee recommended further legislative action by the Senate should be taken after receipt of the forensic check/audit currently being undertaken at the NNPC by the Auditor-General for the Federation and PWC.
Meanwhile, the Chairman, Finance Commissioners Forum, Mr. Timothy Odah, has called for the removal of the fuel subsidy, adding that it the programme had been an unnecessary drain on national resource.
He said that, “State governments are still clamouring for total removal of fuel subsidy because everyone can see it is not necessary considering the fact that there is no enough money. There is no reason giving out what you do not have.”
According to Odah, the states are asking for two billion dollars from the Excess Crude Account to enable them complete ongoing projects.
“The states and the local governments are suffering from dearth of fund to carry out meaningful projects at the local levels. The people at the grassroots need jobs and we need to create jobs for the people, but we cannot do that without the necessary funds,” he lamented.
On the declining global oil price, Odah said the state governments were aware and stressed that diversification of the economy was necessary to cushion the effect of the development “in the long run.”