Reps probe N100bn underpayment by NNPC

Reps probe N100bn underpayment by NNPC
The Minister of State for Pretroleum Resources Emmanuel Ibe Kachikwu

The House of Representatives has ordered an investigation into the alleged underpayment of over N100bn to the Federation Account by the Nigerian National Petroleum Corporation.

On account of the non-remittance from crude oil sale proceeds, the monthly Federation Account Allocation Committee meeting has been deadlocked lately.

As of June 28, the meeting failed to hold for the third time, leaving the commissioners for finance in the 36 states disappointed.

On Tuesday, the House passed a resolution to investigate the underpayment, specifically asking the NNPC to produce its records on crude oil sales for January to July to the ad hoc committee that would conduct the probe.

The motion, which came under matters of urgent public importance, was moved by the Chairman, House Committee on Ethics/Privileges, Mr Nicholas Ossai.

The House expects the NNPC records to include the volume of crude production within the period; the total sales; how much was utilised as Joint Venture Cash Calls; and the exchange rate used in converting dollar to naira before the money was lodged in the Federation Account.

Leading the debate at the session, which was presided over by the Speaker, Mr Yakubu Dogara, Ossai said the deadlocked FAAC meeting meant that the 36 states were left without reasonable funds to run services.

He expressed surprised that the NNPC could not remit funds to the account, in spite of the fact the crude oil was sold above $75 per barrel and higher than the $51 benchmark in the 2018 budget.

Ossai was more worried that the states, in ordinary times, could not pay salaries regularly, adding that with the underpayment by the NNPC, their situation could only worsen.

The Chairman, House Committee on Federal Judiciary, Mr Aminu Shagari, told the House to do a thorough investigation this time round and not to give the NNPC any opportunities to attempt to compromise the committee members.

He stated, “The chairman of the committee should watch it because as usual, the NNPC will try to pick the members one by one and court them.

The resolution was later passed in a unanimous voice vote.

Dogara is expected to name the members of the ad hoc committee within the legislative days.

Meanwhile, after weeks of horse-trading between the NNPC and the FAAC over revenue underpayment, the revenue allocation meeting, which was reconvened on Tuesday, ended in a deadlock.

The reconvened meeting, which was held at the headquarters of the Ministry of Finance in Abuja, was to consider as well as approve revenue generated into the Federation Account for the month of May.

The meeting, which began at about 6pm, ended at 7:32pm, after it was postponed to Thursday.

This is the second time in two weeks that the meeting will be postponed and the sixth this year

Tuesday’s meeting was attended by all the commissioners for finance from the 36 states and the Accountant-General of the Federation, Alhaji Ahmed Idris, among others.

Indication that the meeting was inconclusive emerged when some of the commissioners started leaving the venue of the meeting at about 7:15pm and grumbling.

This continued for about 20 minutes until the hall became empty.

None of the members of the committee was willing to speak to journalists on the matter.

Officials of the FAAC secretariat also declined to comment on the matter when they were accosted by journalists.

While some officials of the finance ministry said the meeting was postponed because FAAC could not form a quorum, others said the decision was because of the lingering issue of revenue underpayment.

An official said, “You will recall that we met two weeks ago to consider the revenue for May and that the meeting ended in a deadlock. This time, we met but could not form quorum and so the meeting was postponed.”

Another official said that there were feelers that the account to be presented by the NNPC was not what was being expected by members of the committee.

The Chairman, Forum of Commissioners of Finance of FAAC, Mahmoud Yunusa, had last week stated that the NNPC had not been transparent with the states in the management of its operations.

For instance, he had said that while the NNPC claimed to have remitted N147bn into the Federation Account, what was actually received was N127bn.

He explained that based on the analysis of the committee, the corporation ought to have remitted a total amount of N146.6bn made up of N87.6bn revenue from Petroleum Profit Tax and N60bn from oil royalties.


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