As subsidy report digs out fraud…Diezani, Dankwambo, Ahmadu Ali blamed
Written by Turaki Hassan & Hamisu Muhammad
*Panel wants 2 oil ministers
*NNPC, PPPRA, marketers to refund N1trn
The long-awaited fuel subsidy inquiry report was submitted to the House of Representatives yesterday with startling revelations of large-scale fraud of more than N1 trillion between 2009 and December last year.
The report laid much of the blame for the irregularities in the subsidy regime on the NNPC, whose board is chaired by Petroleum Minister Diezani Alison-Madueke, as well as on former accountant general of the federation Ibrahim Dankwambo and former chairman of the PPPRA board Ahmadu Ali.
Dankwambo, who was accountant-general for five years until late 2010, is now governor of Gombe State, while Ali is former chairman of the ruling People’s Democratic Party (PDP).
Mrs. Alison-Madueke is also to have her powers whittled as the House committee recommended the appointment of two oil ministers—one in charge of upstream, the other handling downstream.
The report recommended the prosecution of members of the boards and managements of the Nigerian National Petroleum Corporation and the Petroleum Products Pricing and Regulatory Agency, who are found wanting, for making unauthorised deductions of hundreds of billions during the period.
The indictments cover past and serving management of the two agencies, and the report recommended the sack of present NNPC management led by Mr. Austen Oniwon.
It also said NNPC must be made to refund to the federal purse N705 billion; PPPRA N312 billion; oil marketers who drew funding without importation, N8.7 billion; while companies that refused to appear during the investigations are to repay N41.9 billion.
“The committee believes that if the Petroleum Subsidy Fund was properly managed, the sum of N1.07 trillion would have been available to the three tiers of government,” the report said.
When contacted for comments yesterday, spokesman for the NNPC and the Petroleum Ministry, Dr. Levi Ajuonuma, said they were yet to receive the House committee report and they would not make any comments until they study it.
For his part, Ahmadu Ali, in a reply to a text message sent to him asking for his comments, said, “No comments, provided the whole board will be summoned.”
Presentation of the committee’s report was repeatedly delayed amid concerns the Farouk Lawan-led probe panel had come under severe pressure to soften its position.
The House yesterday said the report’s 61 recommendations would be considered at a plenary session to be relayed on live television on Tuesday.
Large-scale fraud unearthed
Copies of the executive summary and the recommendations of the report, which were made available to journalists yesterday, revealed large-scale fraud committed by the NNPC and PPPRA in connivance with oil marketers and top government officials.
On NNPC, the report said, “The management and board of the NNPC should be completely overhauled and all those involved in the following infractions be further investigated and prosecuted by the relevant anti-corruption agencies:
“Payment of N285.098 billion in excess of the PPPRA recommended figure for 2011, subsidy deductions of N310.414 billion for kerosene against a Presidential directive;
“Direct deductions from funds for the Federation Account in contravention of section 162 of the Nigerian constitution and illegal granting of price differential or discounts of crude oil price per barrel to NNPC to the tune of N108.648 billion from 2009-2011.”
“NNPC should be unbundled to make its operations more efficient and transparent, and this we believe can also be achieved through the passage of a well drafted and comprehensive Petroleum Industry Bill. The committee therefore urges the speedy drafting and submission of the bill to the National Assembly,” the report added.
“The NNPC was found not to be accountable to anybody or authority. The corporation in 2011 processed payment of N310.4 billion as 2009-2011 arrears of subsidy on kerosene contrary to a Presidential directive which removed subsidy on kerosene in 2009 without any provisions in the Appropriation Act,” it said further.
The committee recommended “direct for the auditing of the NNPC to determine its solvency. This was as a result of claims of indebtedness and demands for payments by the NNPC’s debtors which if not well handled, will not only affect the entire economy of Nigeria, but also supply and distribution of petroleum products.”
On Mrs. Alison-Madueke, the report asked President Goodluck Jonathan to reorganise the petroleum ministry “by appointing two ministers to take charge of upstream and downstream sectors.”
On Ahmadu Ali, who was PPPRA chairman until last year, the report said he should be prosecuted because it was under his watch that the oil import licenses template was “watered down”.
“The chairman of the board of the PPPRA from 2009-2011, and the entire members of the board during the period are hereby reprimanded and their decision which opened the floodgate for the bazaar is condemned in the strongest terms,” the report said.
Former executive secretary of the PPPRA, Mr. Abiodun Jimoh Ibikunle, was also recommended for punishment over “official recklessness.”
On Dankwambo, the report said, “The particular Accountant General that served during the period 2009 was found to have made payments of equal instalments of N999 million for the record of 128 times within 24 hours totaling N127.872 billion.
“The confirmed payments from CBN records were made to beneficiaries yet to be disclosed by the OAGF or identified by the committee. We however, discovered that only 36 marketers were participants under the PSF scheme during this period. Even if there were 128 marketers, it was inconceivable that all would have imported the same quantity of products to warrant equal payments.”
It added: “All those in the Federal Ministry of Finance, office of the Director General of the budget, Accountant General of the Federation involved in the extra budgetary expenditure under the Petroleum Support Scheme between 2009-2011 should be sanctioned in accordance with the civil service rules and code of conduct bureau. The payment of N999 million 128 times within 24 hours between 12th and 13th January 2009 by the office of the Account General should be further investigated by relevant anti-corruption agencies”.
Trade and Investment minister Dr. Olusegun Aganga served as Finance Minister during the period, while Dr. Bright Okogu has been Director General of the Budget Office.
The report said the subsidy regime was operated from 2009-2011 was fraught with “endemic corruption and entrenched inefficiency. Much of the amount claimed to have been paid as subsidy was actually not for consumed PMS. Government officials made nonsense of the PSF guidelines due to mainly sleaze and in some case incompetence. It is therefore apparent that the insistence by top government officials that the subsidy figures was for products consumed was a clear attempt to mislead the Nigerian people.”
On the whole, the committee found that N2.6 trillion was spent on subsidy last year, amounting to more than 900 per cent over the appropriated sum of N245 billion.
After the submission of the report by committee chairman Lawal, Speaker of the House, Aminu Waziri Tambuwal, said copies should be circulated to all members by today ahead of the consideration on Tuesday.