NEC orders NNPC, Customs, others to refund N8trn under remittances
The National Economic Council (NEC) on Thursday ordered the Nigerian National Petroleum Corporation (NNPC), the Nigeria Customs Service (NCS) and Department of Petroleum Resources (DPR) to refund over N8 trillion under remittances from 2010 to 2015.
Other agencies involved are Federal Inland Revenue Service (FIRS), Nigerian Petroleum Development Company (NPDC), Nigerian Ports Authority (NPA), National Maritime Authority(NMA), Nigerian Maritime Administration and Safety Agency (NIMASA), among others.
The directive followed the adoption of the final report of the KMPG Audit of Revenue-Generating Agencies (RGAs) submitted by the Ad-hoc committee to NEC presided over by Vice President Yemi Osinbajo at the presidential villa, Abuja.
Chairman of the Ad-hoc committee and Governor of Gombe state, Ibrahim Dankwambo told State House correspondents after the meeting that the KMPG technical report on the RGAs found that a total sum of N526 billion and USD$21 billion was not paid into the Federation Account during the period under review.
The governor disclosed that the Minister of Finance, Kemi Adeosun, suggested that the agencies should refund the underpaid amount.
He said NEC also adopted the resolution to identify instances where they may have been criminal infringement for possible prosecution.
Dankwambo said: “KPMG presented the report of the technical audit of RGAs concluding that a total sum of N526 billion and USD$21 billion was underpaid to the Federation Account.
“NEC’s Ad-hoc Committee chaired by Gombe State Governor with members including Governors of Edo, Kaduna, Akwa Ibom, Lagos and the Finance Minister recommended refund of the amounts under-paid.·
“Council adopted the presentations and reports of the KPMG and the recommendations of its Ad-hoc Committee including a resolution to identify instances where there appears to have been criminal infringements and forward such to the Attorney-General of the Federation and the Legal Committee of the National Economic Council for further action.
“Council resolved to pursue strengthening of the NNPC governance structure to prevent further recurrence of such gross under-remittance by the NNPC and other RGAs.”
Expatriating, Dankwambo revealed that the audit period of the RGAs has been extended to 2017.
He explained that the audit was for the revenue generating agencies that have paid into the Federation Account and those that paid for federal government agencies.
He added: “We are talking about federation account because those that paid by law to the federal government are the responsibility of the federal government. So all the entities in the budget that are supposed to pay revenues into government coffers were checked from 2010 to June 2015. That was the cadre.
“One of the resolutions of NEC today is to extend the audit to June 2017. So the audit will continue for the remaining agencies. It is NNPC, NPDC, DPR, Customs, Federal Internal Revenue Services, NPA, Maritime Authorities, all the revenue generating agencies and the details of the infringement are contained in the report. Because it is a voluminous report, there are a lot of items that are there.
“The most important decision that was taken is that a sub-committee will be set up which will be an arm of the legal committee of NEC that will into details of these kinds of infringements and make sure that those issues that are criminal and require prosecution will be handled by office of the Attorney General of the Federation.
“And also to say that an audit, an exception report, is not an okay report. So, we are not looking for a company that is doing well. Accountability does not mean you are doing well. The mirror is very big and depending on how you look at the mirror, that is how you will see yourself.
“So, it is an exception report. We are not looking at the good boys, we were looking for exceptions. And to go further, it is a forensic audit, detailing this kind of shortcomings.”
Also, briefing correspondents, Chairman of the Nigerian Governors Forum (NGF) and Governor of Zamfara state, Abdulaziz Yari, said NEC discussed the question of states determining how much is paid as subsidy by the government rather than the NNPC.
He noted that the council resolved to refer it back to the NEC Sun Committee on remittances chaired by himself.
He added: “We are doing the nitty, gritty with NNPC in terms of remittances. Don’t forget that the reason we got it right in 2016 on the NNPC side is that the oil prices were too low. It was easy for everyone to get fuel into the country and then make a profit.
“So, when the price started jerking up then, the marketers started adjusting back because they needed to have a template of cost recovery and how they are going to make up the difference from the pump price to the landing cost of what they are importing.
“Our problem is the volume, the quantity of consumption which is not acceptable. Working with the governors, so many decisions were taken but by next month, we are going to adopt that position either for the governors to take responsibility for the subsidy in their states based on the consumption or we look at other ways.
“For instance, if you say we paid N800 billion subsidy, you will ask who are we paying the subsidy to? And if you look at infrastructure development and capital programme of the federal government, it is about N1.1 trillion, almost 70 percent of what you are spending developing the economy.
“If there is no infrastructure development, then you cannot talk about the development of the economy.
“N800 billion is a huge amount that we must look at it, who is benefiting from it. So, we are coming up with a strategy, we are going to meet in the month of May and June.
“By next meeting, we will definitely come up with a position of the government at both level of volume of what is being brought into the country and what the state and federal government collaborate to check.”
Also speaking on NEC’s decisions, Governor Rauf Aregbesola of Osun State, said council commended the courage of the President Muhammadu Buhari and Vice President Osinbajo in ensuring the probe of Federal Government Agencies and “completing the audit report as this promote transparency and the anti-corruption efforts of the administration.”
The council noted the establishment of the Nigerian Industrial Policy and Competitiveness Advisory Council approved by Federal Executive Council (FEC) in March 2017, as a vehicle for partnering with the Private Sector on the Industrial Agenda.
NEC received an update on Excess Crude Account (ECA) which as at May 14, 2018, stands at N1,830, 682, 945.30; Stabilization Account, as at May 14, 2018, stands at N 15, 725,456,963.83 while Natural Resources Development Fund balance as at May 14, 2018, stands at N116,104,644,763.39.
Minister of National Planning, Udoma Udoma briefed Council on the just concluded ERGP Focus labs.