Sanusi Lied About $49.8bn Missing Money – Senate Committee

The Senate Committee on Finance on Wednesday described as untrue allegations by the suspended Governor of the Central Bank of Nigeria, Mallam Lamido Sanusi, that $49.8bn was missing from the Federation Account.The committee, led by Senator Ahmed Makarfi, which submitted its report also said the total crude oil lifting from January 2012 to July 2013 was $67bn and not $65bn as claimed by Sanusi.
Sanusi had written President Goodluck Jonathan alleging that the Nigerian National Petroleum Corporation had failed to remit $49.8bn, being part of the income it generated from the sale of crude oil to the Federation Account.But the committee stated that all the agencies, which made presentations to it, agreed after reconciliation that $47bn out of the $67bn had been credited to the Federation Account, leaving only $20bn yet to be accounted for.
It added that the $5.254bn spent on subsidy for Premium Motor Spirit by the Petroleum Products Pricing and Regulatory Agency, which was part of the $20bn, was covered by the Appropriation Acts of 2012 and 2013.

It, however, said that $3.512bn for kerosene subsidy certified by PPPRA for the period January 2012 to July 2013 was not appropriated for by the National Assembly.

The committee, therefore, asked the management of the NNPC to refund $262m to the Federation Account, being the expenses it could not satisfactorily defend during the just concluded probe of the alleged missing $49.8bn.
It also asked the corporation to remit the balance of $218m out of the $2.4bn third party financing, out of which the share of the Federation Account was $1.58bn. It also recommended the complete stoppage of the subsidy regime in the country.

The $262m, which the NNPC was asked to refund, was in respect of holding strategic stock reserve, pipeline maintenance and management cost, and capital expenditure.
The committee stated in the report, “There is the need for the subsidy regime to be totally discontinued with. All stakeholders, however, should be consulted and carried along as much as possible before abolishing the subsidy.”
It further noted that royalties and taxes amounting to $447.8m, being outstanding from the Federation Account share from the $6.815bn listings by the NNPC on behalf of the NPDC, remained unremitted

It also noted that gross lifting under the third party financing arrangement was $2.4bn, out of which the share for Federation Account was $1.588bn
“The Attorney-General of the Federation confirmed and gave documentary evidence showing the sum of $1,370,172,650.36 was remitted to the Federation Account,” the report stated.
The committee, therefore, recommended that the NNPC should remit the balance of $218,069,354.32 to the Federation Account

“The NNPC should refund and remit to the Federation Account the sum of $262m, being expenses it could not satisfactorily defend of holding strategic stock reserve; pipeline maintenance and management cost and capital expenditure,” it stated.

It said that further legislative action by the Senate should be taken after the receipt of the forensic audit being undertaken at the NNPC by the Auditor-General for the Federation and auditors.

It asked the NNPC not pay for its operational expenditures directly from the federation’s funds without appropriation by the National Assembly and that the corporation should strictly adhere to international best practices in keeping records.
Other recommendations are: “That the NNPC should not control the revenue account of the NPDC in order not to undermine its separate legal status and make accountability more difficult.

“That average number of days taken to discharge a vessel load of 33 and a half days as against the expected one and a half days resulting in $207.8m demurrage.
“The committee could not see how the figure of $49.8bn was arrived at by the CBN governor in the first instance.

“That the CBN governor at the first hearing had forwarded the figure of $12bn as money to be reconciled and changed his position to $20bn at subsequent hearings.
“At the conclusion of his written submission, Sanusi posited that it could be $20bn, $12bn, $10.8bn or anything in between.
“The CBN governor orally or in writing never outright submitted that money was missing but that money was not remitted to the Federation Account by the NNPC.”

The committee also recommended that President Goodluck Jonathan should prepare and present to the National Assembly a supplementary budget to cover the over-expenditure in the sum of N90.693bn for PMS subsidy for 2012.
It also said the sum of N685.910bn for kerosene subsidy expended without appropriation by the National Assembly in 2012 and 2013 should also be covered by the supplementary budget.
The committee observed that there was lack of proper and adequate coordination between key agencies of the government such as Ministry of Finance, Ministry of Petroleum Resources, the CBN, NNPC, Department of Petroleum Resources, and Federal Inland Revenue Service.

It noted that the issue of non-remittance of oil revenue was not new and that it was the not the CBN governor that first discovered it, adding that it had been a recurring issue at the monthly Federation Account Allocation Committee meetings.
The committee, however, stated that it could not see how the figure of $49.8bn was arrived at by the CBN in the first instance.