Subsidy Hearing: Diezani, Customs Chief Give Conflicting Testimonies

Nigeria’s minister of Petroleum resources, Diezani Allison-Madueke and Comptroller General of Customs Abdullahi Dikko Inde yesterday gave conflicting testimonies over petrol imports and subsidy payments during a hearing by a House of Representatives committee in Abuja.

The committee was holding its second day of public hearing to determine the extent of alleged multi-billion naira corruption on the fuel subsidy regime.

Allison-Madueke was the first to speak, saying that the Nigerian National Petroleum Corporation no longer imports petrol and that only private importers were involved.

She also said part of the fraud in the system was smuggling out of petrol on which government had already paid subsidy.

But when it was his turn to speak, Inde, who was represented by the Deputy Comptroller General in charge of Accounts and Tariff Julius Ndubuisi Nwogu, said contrary to the minister’s assertion, NNPC was still importing petrol because he had possession of a manifest that showed that the corporation brought petrol into the country in December.

The Customs official displayed a copy of a document showing that NNPC imported petrol for December 2011 which was discharged at Calabar port, “and was solely imported by NNPC but we don’t know the country of origin but was brought through Cotonou off shore.”

Inde also said rather than “smuggling” as mentioned by the minister, what was happening was “diversion” because large vessels importing fuel supposedly to Nigeria do not reach the country’s shores but were kept in territorial waters of Benin or Togo while smaller vessels ferry only a fraction of the fuel to Nigeria.

The Customs chief said apart from petrol, NNPC also imports crude oil to the Kaduna refinery.

“Kaduna refinery runs on imported crude not domestic and no duty is paid on that till date. NNPC imports it through Warri port and move it straight to Kaduna refinery,” he said.

He said the then president Olusegun Obasanjo used presidential fiat and granted import waivers on all petroleum products since 2002 as a result of which all imported fuels are exempted from duty taxes.

He said oil importers including the NNPC perpetrate fraud by keeping the “mother vessels” on Benin or Togo territorial waters and using smaller vessels to bring in the petroleum products.

Earlier, Mrs. Allison-Madueke said contrary to the popular belief, there was no group of oil importers who constitute themselves into a cabal.

“I am under oath therefore it will not be proper for me to speculate of the existence of cabal in the oil sector. It is not proper to criminalise certain group with one fell swoop just as we cannot criminalise the actual policy of subsidy itself.

“They are bona fide marketers even though there have been manipulations in the sector and we are looking into it aggressively, as we have made certain changes since last year, until we are able to rout out those who corrupted the system to their advantage,” she said.

The petroleum minister however, could not name those involve in “corrupting the system” when asked by House committee chairman Faruk Lawan (PDP, Kano).

On why subsidy funds rocketed from the budgeted N245 billion to N1.3 trillion, the minister said the N245 billion was only meant to service subsidy for the months of January- February 2011 as the government had planned to end the subsidy regime in March 2011 but was pressurised to shelve that.

The petroleum minister also said the government was yet to arrive at exact amount of money spent on subsidising petrol as “we are still grappling with the figures.” She added that it would take at least four months to finish the computation.

Allison-Madueke said deduction of subsidy funds from source by the NNPC was lawful. “We have done nothing unconstitutional as a ministry since Appropriation Act defines that and section 80 subsection 3 of the 1999 constitution authorise us to deduct from source,” she said.

She said the finance ministry authorises such deductions. But on Monday Finance Minister Mrs. Ngozi Okonjo-Iweala denied authorising subsidy deductions.

When asked by committee members to give them assurance that NNPC will not embark on any illegal deductions again, Allison-Madueke said, “I am under oath I cannot give you assurance on this because the oath is bigger than the assurance.”

The House committee hearing is scheduled to continue today.

Source: Daily Trust