Reps query N155bn fuel subsidy in 2012 budget proposal

BY BEN AGANDE & EMMAN OVUAKPORIE
ABUJA — THE leadership of House of Representatives, yesterday, raised eye brows over the insertion of N155 billion by the Federal Government in the 2012 budget proposal for payment of fuel subsidy arrears, in addition to the N1.3 trillion spent as at September 2011.

The Farouk Lawan-led ad-hoc Committee on Subsidy Regime asked Dr Ngozi Okonjo-Iweala, Coordinating Minister of the Economy and Finance to provide the bank statements, details of quantum of crude oil extracted, volume of PMS consumed per day and relevant documents on the payment of fuel subsidy from Federal Ministry of Finance as well as the unilateral withdrawal of revenues generated from the Joint Venture Cash Calls by Nigerian National Petroleum Corporation, NNPC, without recourse to the National Assembly.

Chairman, Revenue Mobilisation and Fiscal Commission, RMFAC, Mr Elias Mbam, in the document presented to the ad-hoc committee during the investigative sitting, disclosed that “as of now, the management of subsidy is not clearly defined between the NNPC, PPPRA, Ministry of Petroleum Resources and Ministry of Finance.”

Earlier, Mr Makinde Olarotimi, who worked in NNPC for 20 years, queried the failure of the Federal Government to implement the bilateral agreement signed with some oil producing countries, OPEC members, who have refineries, noting that the implementation of the bilateral agreement would reduce the high cost of refining crude oil and cost of production.

Olarotimi said the N1.3 trillion fuel subsidy claim by the Federal Government as against N245 billion provided in the 2011 fiscal framework was debatable.

Dr Okonjo-Iweala in her presentation, frowned at the spate of corruption in the administration of subsidy regime and operations of revenue generating agencies and disclosed that President Goodluck Jonathan had approved the setting up of a committee to ensure that all revenues generated were remitted into the federation account.

On his part, Bright Okogu, Director-General of Budget Office, said the N155 billion provided in the 2012 budget proposal was in anticipation of the payment to oil marketers as at December 2011, adding that the N245 billion provided in the 2011 fiscal framework was a notional figure and that the Federal Government envisaged deregulation of the downstream of the oil sector.

He said about N500 billion was provided for in the previous year for subsidy and there was no way Federal Government could “know how much of subsidy you will need because it depends on international price of crude oil, exchange and other factors.”

http://www.vanguardngr.com/2012/01/reps-query-n155bn-fuel-subsidy-in-2012-budget-proposal/