The minister of Finance, Dr. Ngozi Okonjo-Iweala yesterday dropped a bombshell when she said that her Ministry has no knowledge on how much the federal government spent on subsidy. According to her, ”what the ministry does is to get the accountants to verify what the importers present as their imports and pay them”.
She maintained that there would be no way the ministry could accurately determine how much petroleum products are imported and how much are actually sold in Nigeria. She said “what we are doing is subsidizing other countries”. “We have genuine importers, but must separate them from the smugglers who ferry petroleum products to other countries after claiming to import the products to Nigeria,” she said, wondering if there is a way of stopping the smugglers.
Mrs Okonjo-Iweala said in 2006, N256 billion was spent on subsidy, but over the years, this has skyrocketed to the extent that governors became worried that they were being short-changed.
The heavy deduction for subsidy, she said, was what resulted in the November and December 2011 refusal by governors to collect their allocations, until the subsidy was removed. While expressing on what she expecting from the committee set up by the National Assembly to probe the subsidy removal, Okonjo Iweala said “when the report comes out, we will know those who are genuine importers and those who are not”. To her, the government “did not explain itself well and did not wait long enough before removing the subsidy in January” – an admittance that the government acted in a hurry. Despite the protest and the government’s conceding to the wishes of the people, Mrs Okonjo-Iweala said, the government is still paying subsidy, but partially.
She also admitted that the economy that is growing at 7.9 per cent and yet claims to be creating jobs is not inclusive. She attributed this development to “challenges”, stressing that jobs must be inclusive and target rural areas.
According to her, we are “growing at 7.9 per cent with no power. You can imagine what the growth will be like, if power was stable.” On the erratic electric power situation, Mrs Okonjo-Iweala said privatising the Power Holding Company of Nigeria (PHCN) should be fair and transparent and not under the table. She said: “Government has decided to get away from what it has not succeeded in doing in the past. Power that we get is heavily subsidized.
Investors have insisted that tariff must match cost of producing power. They will not purchase the companies, unless the government announces the new tariff, but government is scared of the backlash from the masses, if it announces the new tariff.”
Via Daily Post