Senate chides NNPC over N443bn subsidy payment

Filed Under: news

On: March 3, 2021

Sunday Aborisade, Abuja

Senate Public Accounts Committee, on Wednesday, berated the Nigerian National Petroleum Corporation for paying N443bn without the National Assembly’s appropriation.

The Chairman of the Committee, Senator Mathew Urhoghide, has summoned the management of the NNPC to explain the expenditure it made without budgetary provision.

The Committee took the decision based on the 2016 report of the Auditor General for the Federation, which it is currently being scrutinised.

The AuGF query to the NNPC read, “During the examination of Subsidy records provided by the Federation Account and Allocation Committee, it was observed that the total subsidy paid during the year 2016 was N443,940,559,974.80.

“They included the 2014 arrears paid to oil marketers in 2015 and the payments made in 2016 without Interest is 403,321,449,046.76.

“Interest and forex differential is 40,619,110,928.04 totalling N443,940,559,974.80 which was termed subsidy deducted at source by the NNPC .

“This reflects continuing weaknesses in the budgeting process adopted by the Federal Government.”

The Accountant General of Federation, Ahmed Idris, told the Committee that the NNPC would be in a better position to explain the extra-budgetary spending query raised by the AuGF.

Meanwhile, the Senate panel also on Wednesday, summoned the Central Bank of Nigeria over the alleged disappearance of $9.5m being interest on the Investment Petroleum Profit Tax, Royalty and Foreign Excess Crude.

The invitation of the apex bank was based on the 2016 AuGF report which indicted the CBN of failing to present documents to support the investment, for verification.

The Senate observed that there was no letter to support the investment of the fund and the actual amount invested were not made known.

The AuGF query read to the CBN read, “During the examination of transfers to Forefinger Excess PPT/Royalty and Foreign Excess Crude Accounts it was observed that during the year 2016, amount totalling $6m and $3.5m were credited to the Foreign PPT/Royalty and Foreign Excess Crude Account as interest on Funds investments.

“The authority for placing the funds which yielded the above interests totaling $9.5m in a deposit account, the principal sums deposited, the tenor and rate of interest were not made available for audit verification.

“This observation had also been a subject of my reports since 2017 without any positive response from the Central Bank of Nigeria

“Records made available for audit further revealed that the balance in the foreign PPT/Royalty and Foreign Excess Crude accounts as of 28th December 2016 were USD0.00 and USD, 251,826 respectively

“This suggest why the foreign PPT/Royalty was depleted before the year end

“The Accountant General has been requested to provide the authority for the funds invested, tenor of the investment, rate unrest payable, certificate for the funds invested and forward same for audit verification.”

Urhoghide however asked the Accountant General of the Federation, to respond to issue raised in the AuGF.

The Accountant General was unable to present any document on the issues raised by the Committee.

He, however, told the lawmakers that his office had sent a letter to the CBN for clarification on the issue raised.





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