Nigerian House of Representatives Debate Grows Intense Amid Fuel Subsidy Probe

Nigerian Minister of Petroleum Resources Diezani Alison-Madueke is the subject of controversy resulting from a probe into the fuel subsidy crisis in the oil-producing West African state. Protests over the cancellation of subsidies erupted in 2012., a photo by Pan-African News Wire File Photos on Flickr.

Uproar as Reps seek oil minister’s sack

Thursday, 26 April 2012 00:00 From Azimazi Momoh Jimoh and Terhemba Daka, Abuja News - National
Nigerian Guardian

Jonathan to get subsidy probe report in two weeks

THE House of Representatives’ debate of the fuel subsidy report yesterday slipped into bedlam following a failed attempt to seek the resignation of Petroleum Resources Minister, Mrs. Diezani Alison-Madueke.

Minutes into yesterday’s session, a member of the House, Robinson Uwak, raised “Matters of Privilege” and informed the chamber that his constituents had accused the House of shielding the minister.

But before he could go further on the issue, Deputy Speaker, Emeka Ihedioha, who led the session, swiftly asked Uwak “to approach the chair.”

After a few minutes of discussion in low tone, Uwak returned to his seat looking very dissatisfied.

Insisting on his motion, the lawmaker asked that a special recommendation be inserted in the report to compel Alison-Madueke to resign as Petroleum Minister for presiding over the reported fraud in the petroleum industry.

Uwak’s request was immediately greeted with thunderous applause by many members.

But the House Deputy Leader, Leo Ogor, drew the chamber’s attention to the premise that Uwak had breached the rule of procedure.

According to Ogor, since the House was yet to start the report’s consideration, it would be improper to entertain the motion proposed by Uwak.

This was supported by Ihedioha, who stated that Uwak erred and consequently ruled him out of order.

Explaining his action at the end of the session later, Uwak said that he tried to save the House from attracting criticisms to itself for the minister’s sake.

According to him, it was improper not to have a specific recommendation against the minister who had publicly admitted that there were lots of shady deals in the oil sector.

However, another member, Benjamin Aboho, came back with the same anti- Alison-Madueke motion a few minutes later insisting that there was need to amend the recommendations to accommodate the request for the minister’s resignation.

He specifically moved that recommendation 45 be amended to achieve this objective.

Aboho was equally overruled and the matter was never raised by any other member until the session ended.

Meanwhile, the House yesterday amended the aspect of the report, which indicted the former Accountant -General of the Federation and incumbent Governor of Gombe State, Ibrahim Dankwabo.

Recommendation 43 of the report had stated: “The payment of N999,000,000 in 128 times within 24hrs (12th & 13th January, 2009) by the Office of the Accountant –General of the Federation should be further investigated by relevant Anti-Corruption Agencies.”

The lawmakers, after listening to three different letters on the issue from the Central Bank of Nigeria (CBN); the Petroleum Products Pricing and Regulatory Agency (PPPRA) and Dankwabo resolved to investigate only the PPPRA.

Chairman of the ad-hoc committee, Farouk Lawan, thereafter read the letter addressed to his committee by the CBN explaining that the withdrawal was sanctioned by the PPPRA and as such it would not be necessary to involve Dankwabo.

The clause was thereafter amended to read thus: “That the payment of N999,000,000 in 28 times within 24 hrs (12 and 13 January, 2009) by the PPPRA be further investigated by the relevant Anti-Corruption Agency.”

Meanwhile, the House of Representatives has said that it would delay the submission of the report to the President for implementation until the Ad hoc Committee, concluded its meeting with the 17 oil firms that failed to attend the last public hearing.

Addressing the media on the development after yesterday’ session, the Chairman House Committee on Media and Public Affairs, Zakari Mohammed, said: “The report will not be sent to the Presidency in piece-meal until the second one comes in and is harmonised. The report will also be sent to the Senate for guidance, the AGF and the various anti-corruption agencies.”

The House also approved the recommendation that: “The services of the accounting firm of Akintola Williams, Deloitte and Olusola Adekanola & Partners should be discontinued with immediate effect for professional negligence” and added that an independent accounting firm be appointed.

Other key recommendations of the committee adopted yesterday included:

• The National Assembly should enact an Act to criminalise extra- budgetary expenditure.

• CBN and the Federal Ministry of Finance should critically examine and review the policy guiding payment for importation of petroleum products to avoid the current fraudulent system that allows importers to bring in products from offshore ‘Lome’ or ‘Cotonou’ to qualify for forex payments.

• The Committee notes that several alarms were raised by the CBN on the escalation of subsidy figures but these early warning signals were ignored by relevant agencies. The Committee wishes to encourage whistle -blowing by regulatory agencies on threats to the economy with the hope that proactive measures could be taken.

• The Committee recommends that the PPMC Management be overhauled. In furtherance to above recommendations of the committee, institutional mechanisms be urgently developed to ensure the monitoring of actual delivery of kerosene to the Nigerian masses.

• The PPMC should deploy modern, state-of-the-art devices to protect its facilities and pipelines to eliminate wastages arising from vandalism. In the short-term however, PPMC should establish a surveillance system, which should incorporate Community-protection and using part of the bridging funds on the PSF Template to finance this.

• All the extant circulars preventing the Nigeria Customs Service from carrying out its statutory functions be immediately withdrawn by the Central Bank of Nigeria and the Federal Ministry of Finance.

• The Committee recommends that NNPC takes immediate action to pay the N46 billion owed the Nigeria Customs Service and the N6 billion owed to the Nigerian Ports Authority

• The Nigerian Ports Authority (NPA) should be encouraged within a timeframe to improve on the draught level of the Nigerian waters to encourage the berthing of ALL types of vessels so as to eliminate the present ship-to-ship (STS) transfers by importers of petroleum products.

• All those in the Federal Ministry of Finance, Office of the Director-General Budget, and the Office of the Accountant General of the Federation involved in the extra budgetary expenditure under the PSF Scheme (2009-2011) should be sanctioned in accordance with the Civil Service Rules and the Code of Conduct Bureau.

• The regulatory capacity of the DPR should be strengthened. The National Assembly should commence the process of amending the Act to make the Agency autonomous.

• The DPR should take immediate steps to bring all facilities and depot owners into compliance with international best practices by ensuring the installation of modern metering gadgets and sealable and non-return valves, to eliminate the rampant cases of round-tripping.

• The DPR should brace up to its role of regulation and compel the NNPC/PPMC to comply with all the regulations issued to ensure transparency and accountability.


House in stormy session over Diezani, Dankwambo

By Victor Oluwasegun and Dele Anofi, Abuja
Nigerian Nation

It was a bit stormy yesterday at the House of Representatives.

The recommendation of the Ad Hoc Committee on Fuel Subsidy Regime “that the payment of N999 million 128 times within 24 hours (12 and 13 January, 2009) by the Office of the Accountant-General of the Federation be further investigated by the relevant anti-corruption agencies” was amended to exonerate the former Accountant-General, Ibrahim Dankwambo. Dankwambo is governor of Gombe State.

The removal of Dankwambo’s name from the committee’s 42nd recommendation almost resulted in a shouting match between Deputy Speaker Emeka Ihedioha, who presided over the committee of the Whole, and the Minority Leader, Femi Gbajabiamila.

Dankwambo’s name was substituted with the Petroleum Products Pricing Regulatory Agency (PPPRA) which was said to have issued the cheques.

Gbajabiamila had insisted that rather than removing the former AGF’s name completely, both Dankwambo and PPPRA should be made to account for such an “incredible payment”.

Gbajabiamila said: “We should say office of the AGF and PPPRA since it was under his watch that all these happened”.

Abike Dabiri-Erewa said: “The punishment is too mild. If one person stays in his office and writes cheques of N999m 128 times, that person should be indicted.”

Uche Ekwunfe said: “You’re all being unnecessarily sensational. The CBN said at the time that they couldn’t pay more than N1billion and what they did was to split the payment.

Gbajabiamila then proceeded to move a motion to include the AGF in the recommendation.

But Ihedioha stopped him, saying Lawan had an explanation.

Lawan said the CBN had written to say the PPPRA was in charge of the payments and that CBN said N999 million was paid 111 times on January 12 and 13 times on January 13.

Ihedioha then asked Lawan to move the motion that AGF should substituted PPPRA.

But Gbajabiamila protested and said: “I moved my motion before him. I have a motion on ground”.

Ihedioha said Farouk Lawan has just explained and he wants to move a motion to reflect it. Let him move his motion.

Visibly angry, the Minority Leader continued with his protest. But Ihedioha ignored him and asked Lawan to move the motion to exclude the former AGF.

Members voted in favour of Lawan’s motion and the AGF was changed to PPPRA in the recommendation.

But the Deputy Speaker did not allow Gbajabiamila to move the motion. He instead, gave the floor to the chair of the ad hoc panel.

According to him, the CBN letter shows that issuing of the cheques and the payment authority was from the PPPRA and that a regime was in place at the time that stopped payment above N1 billion.

Also, an attempt to pass a motion asking for the resignation of the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, caused a stir. The chamber burst into shouts.

Barely had the session begun that a legislator, Robinson Uwak, (PDP Akwa Ibom), raised an order under privilege.

He said: “Since yesterday, I have been receiving calls from my constituents, accusing me that we, as members of the House, are shielding the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke. This allegation is rubbing negatively on the credibility of my person.

“We should recommend that the Minister of Petroleum Resources should resign her office with immediate effect.”

A loud ovation from the members greeted these remarks.

But the Deputy Leader, Leo Ogor sprang to his feet, saying: “This is the people’s parliament. We have a report before the House that we have not even started considering. I think we should give respect for due process.”

His words were greeted with shouts of “no, no, no!”

Ogor said: “I don’t think it’s the wish of anyone of us to act in a way that suggests that we have an issue against anybody. Be mindful that in all that we do, we must be fair to everyone. I, therefore, rule Honourable Uwak out of order.”

The lawmakers were, however, united on other recommendations, including that the services of accounting firms Akintola Williams, Delloite and Olusola Adekanola &Partners should be discontinued immediately for professional negligence.

The House considered 35 clauses in the report in its Tuesday session, but it concluded its consideration of the main report of the ad-hoc committee yesterday. It gave 17 marketers, who claimed they were not invited to the public hearing, another chance to present their cases.

Besides, the House stayed action on the recommendation concerning 71 companies who were on the schedule of those disallowed claims to discharges and subsidy between 2010-2011 totalling N230.2bn.

This followed observations by the Chairman of the House Committee on Rules and Business, Sam Tsokwa that some of the 71 companies form part of the 17 oil marketers who were given a second chance to appear before the committee.

Members passed a motion “that the resolution of the House on the fuel subsidy regime be sent to the President, the Senate and all anti-corruption agencies for information and action.

The House also sought action against “all those in the Federal Ministry of Finance, Office of the Director-General Budget and the Office of the Accountant General of the Federation involved in the extra budgetary expenditure under the PSF Scheme (2009-2011)”.

“They should be sanctioned in accordance with the Civil Service Rules and the Code of Conduct Bureau. “

Speaking with reporters after the session, House spokesman Mohammed Zakari defended the action of the House on the former AGF and the Petroleum Resources Minister, saying they were not trying to shield anybody.

On the Ministry of Finance, he said: “All those will include anybody that has anything to do with the Federal Ministry of Finance between 2009 and 2011 and that includes the minister who is the superintending officer at that time,

“It’s clear; we avoided the situation where names will be named on the floor of the House because it’s a report we are giving and we say that if you look at part of our recommendation, the NNPC management board and, off course that of the PPRA the chairman of the NNPC management board is the Minister of Petroleum.

“Having to single out and begin to mention her name over and over again will mean that we are biased. So, we have made it clear and one of the papers today specifically brought it out, though some others didn’t The fact we got from even the Ministry Information that came was not exhaustive enough. it was not self-explanatory and those issues were there.

“The committee did its job and avoided naming names. Even when they were talking about PPPRA, they said the chairman as at that time. It was now left to you to bring out who the chairman was.

“There was a chairman within the time under review. There is a chairman of NNPC as we talk and within the time under review.”

On Allison-Madueke, he said: “The minister’s case is a case that has been settled since yesterday (Tuesday). It’s one of the recommendations that they should be reprimanded.

“Remember, it took us about 41 minutes on the issue, that those of PPRA and NNPC should be reprimanded and the members stood up and said “no”. They said not reprimand alone; they should be persecuted.

“We are not particular about persons but we are particular about the acts of individuals that brought us where we are today.

It’s a very sad decimal that if we allow this business-as-usual thing to continue. If this kind of billions and trillions are flying over the place and ending up in private pockets individuals will be richer than even the state. “

He said the case of the former AGF had been settled by Lawan’s explanation.

In his closing speech, Lawan said the committee had done its best and that members should be ready for attacks from powerful individuals and interests affected by the report.

The House recommendations are:

·The services of the accounting firm of Akintola Williams, Deloitte and Olusola Adekanola & Partners should be discontinued with immediate effect for professional negligence on this particular assignment.

· In view of the above, the two firms should be blacklisted from being engaged by any Federal Ministry, Department or Agency (MDA) for a period of three years.

·That the House Committee on Petroleum (Downstream} shall in its monitoring stage conduct extensive and thorough investigation into the operations of the PEF(MB) to ascertain the management of the bridging funds under the subsidy regime.

·The penalties should also be indicated for non-compliance and promptly imposed to ensure the smooth operation of the scheme.

·The Nigerian Ports Authority (NPA) should be encouraged within a time frame to improve on the draught level of the Nigerian waters to encourage the berthing of ALL types of vessels so as to eliminate the present ship-to-ship (STS) transfers by importers of petroleum products.

·All those in the Federal Ministry of Finance, Office of the Director-General Budget, and the Office of the Accountant General of the Federation involved in the extra budgetary expenditure under the PSF Scheme (2009-2011) should be investigated.

·The payment of N999, 000,000 in 128 times within 24hrs (12th& 13th January, 2009) by the PPPRA should be further investigated by relevant Anti-Corruption Agencies.

·The National Assembly should enact an Act to criminalise extra budgetary expenditure.

·CBN and the Federal Ministry of Finance should critically examine and review the policy guiding payment for importation of petroleum products to avoid the current fraudulent system that allows importers to bring in products from off-shore “Lome” or “Cotonou” to qualify for forex payments.

·The Committee recommends that several alarms were raised by the CBN on the escalation of subsidy figures but these early warning signals were ignored by relevant agencies. The Committee wishes to encourage whistle -blowing by regulatory agencies on threats to the economy, with the hope that proactive measures could be taken.

·The Committee recommends that the PPMC Management be overhauled. In furtherance to above recommendations of the committee, institutional mechanisms be urgently developed to ensure the monitoring of actual delivery of kerosene to the Nigerian masses.

·The PPMC should deploy modern state-of-the-art devices to protect its facilities and pipelines to eliminate wastages arising from vandalism. In the short-term, however, PPMC should establish a surveillance system which should incorporate Community-protection and using part of the bridging funds on the PSF Template to finance this.

·All the extant circulars preventing the Nigeria Customs Service from carrying out its statutory functions be immediately withdrawn by the Central Bank of Nigeria and the Federal Ministry of Finance.

·The Committee recommends that NNPC takes immediate action to pay the N46billion owed the Nigeria Customs Service and the N6billion owed to the Nigeria Ports Authority

·The failure of NPA to provide this Committee the vital vessel data particularly the IMO numbers is an indication that either NPA has a very poor record keeping system or that it was a deliberate ploy to cover up the collusion between its officials and importers. We recommend an investigation into the operations and activities of this Authority by House Committee on Marine transport.

·The port operations of the Nigerian Ports Authority be investigated with a view to determining the extent to which its officials are complicit in the classification of maritime areas for reception of Nigerian bound petroleum products as “offshore Cotonou” and “offshore Lome” in the face of evidence that these Vessels never did lighter at those Ports.

·In the course of this investigation, a lot of efforts were made to establish cases of round tripping and diversion of products, including the use of the data from Llyods List Intelligence, resulting in the cases so far reported. However given the scale of connivance and collusion by government officials involved in the certification process, the Committee believes that further investigation will reveal more cases. It is therefore recommended that all the data obtained in the course of this investigation, especially from the Llyods List Intelligence be forwarded to the relevant anti-corruption agencies for a more detailed investigation.

·Deleted.

·PEF(M)B should establish a tracking system on all trucks from point of loading to point of discharge (retail outlets) and direct that all trucks involved with transportation of products should install approved tracking devices on them.

·That it is hereby recommended that the regulatory capacity of the DPR be strengthened. The National Assembly should commence the process of amending the Act to make the Agency autonomous.

·That the DPR should take immediate steps to bring all facilities and depot owners into compliance with international best practices by ensuring the installation of modern metering gadgets and sealable and non-return valves, to eliminate the rampant cases of round-tripping.

·That the DPR should brace up to its role of regulation and compel the NNPC/PPMC to comply with all the regulations issued to ensure transparency and accountability.

·That in order to reduce and gradually eliminate lightering, associated inefficiency and cost, Government should invest in the provision of Single Point Mooring (SPM’s). This provision should be followed up by instituting Regulations to compel owners of jetties, depots and storage facility owners to develop pipeline throughput availability to facilitate direct delivery of imported products by heavy vessels, in-shore Nigeria.

·That there should be a deliberate policy by government to encourage the utilisation of gas in automobile, domestic (cooking) and industrial facilities.

·That as a matter of urgency and in furtherance of our national security requirements, a national strategic reserve should be immediately enhanced so to accommodate 90days stop gap strategic reserve.

·We strongly recommend that relevant Standing Committees of the National Assembly should be more proactive in their oversight responsibilities to forestall future occurrences.

·That the House gives the 71 companies further one week to appear before the ad-hoc committee.

·That the resolution of the House on the fuel subsidy regime be served on the President, Senate and all anti-corruption agencies in Nigeria for information and necessary action.