Dr. Ngozi Okonjo-Iweala, former Managing Director of the World Bank, is the Finance Minister for the Federal Republic of Nigeria, has drawn attention to the national debt in Africa's largest populated state., a photo by Pan-African News Wire File Photos on Flickr.
Govt pays N451b subsidy arrears, allays fears over fuel scarcity
Wednesday, 30 May 2012 00:00 From Mathias Okwe, Abuja News
THE Federal Government yesterday said it had paid N451 billion of the N888 billion fuel subsidy vote in the 2012 budget as arrears for 2011.
The government said the payment was based on claims by the Petroleum Products Pricing Regulatory Agency (PPPRA) and the Nigerian National Petroleum Corporation (NNPC).
It ruled out however out the likely return of the scarcity of petroleum products across the federation because of its restriction of payment of subsidy to marketers after due diligence and verification of imported fuel.
In a statement yesterday, the Federal Ministry of Finance, said since the estimate of the NNPC/PPPRA for 2011 arrears was N232 billion, it means that more than double the projected amount had already been spent and “these agencies are still bringing in more claims.”
For imports already verified, the government says their share of the subsidy funds would be paid after the Federal Accounts Allocation Committee (FAAC) meeting in June.
The ministry said it had a responsibility to ensure that subsidy payments were made in a prudent and transparent manner, adding that in line with this focus, it would continue to pay all marketers, whose claims of fuel importation have been verified as genuine.
The ministry, in the statement signed by the Senior Special Assistant to the Coordinating Minister for the Economy and Minister of Finance, Paul Nwabuikwu, explained that after the next meeting of FAAC in June, the government would resume the payment subsidy to fuel marketers.
He said while the ministry is ready to work with relevant agencies for the common good of Nigerians, it will not be stampeded into making hasty payments on deliveries that have not been substantiated or verified.
Nwabuikwu said against this background, the “ministry categorically rejects the idea that a prudent approach to verifying and making payments will lead to fuel scarcity. Indeed, to say that the ministry’s efforts to learn lessons from the past and reform the way payments are made will lead to fuel scarcity is simply not the case.
He said the ministry’s approach to the subsidy regime could best be appreciated against the N451 billion claims for the 2011 arrears.
“This is clearly not sustainable and the ministry has a responsibility to ensure that the lapses that may have led to this unhealthy situation are not repeated. That is the least that the ministry owes the Nigerian people.
“In line with the directive of the President, the ministry will continue to work towards the improvement of the fuel subsidy regime based on the lessons learnt from our recent experiences.
The ministry is determined to put in place a strong framework for the fuel subsidy regime that is both transparent and sustainable,” Nwabuikwu said.
He added that the ministry’s approach to improving the subsidy regime is predicated on the following core objectives: Ensuring that the country’s finances are managed in a manner that clearly protects the interests of the Nigerian people; putting in place a system that ensures that only the genuine claims of genuine marketers are honoured, and performing its functions in an efficient and proactive manner to ensure that Nigerians get fuel at the right time and at the right price.