Just over a year ago President Goodluck
Jonathan suspended me from my position as governor of the Central Bank
of Nigeria after I questioned an estimated $20bn shortfall in oil
revenues due to the treasury from the state oil company. As I said then,
you can suspend a man, but you cannot suspend the truth. The
publication last month of a PwC audit into the “missing billions” brings
us a step closer to it.
When I was central bank governor I
raised three broad questions. First, did the Nigerian National Petroleum
Corporation remit to the government the entire proceeds of its crude
oil sales? Second, if it did not, is there proof of the purpose to which
the unremitted amounts were applied? And third, did NNPC have the legal
authority to withhold these funds?
Contrary to the claims of petroleum
minister Diezani Alison-Madueke, the audit report does not exonerate the
NNPC. It establishes that the gap between the company’s oil revenues
between January 2012 and July 2013 and cash remitted to the government
for the same period was $18.5bn. And it goes into detail about the
NNPC’s account of how it used that money, which raises serious questions
about the legality of the state oil company’s conduct.
The auditors say a significant part of
the unremitted funds is supposed to have gone towards a kerosene subsidy
that had been stopped two and a half years earlier by the late
President Umaru Yar’Adua. His decree never appeared in the official
gazette, leading some to question whether it ever had legal force.
Evidence disclosed in the report
suggests this is a sideshow. The executive secretary of the agency
charged with administering subsidies confirmed that, acting on
Yar’Adua’s orders, it had ceased granting subsidies on kerosene. There
was no appropriation for such a subsidy in the 2012 or 2013 budgets.
Throughout all this, Nigerians paid
120-140 naira a litre of kerosene, far more than the supposed subsidised
price of 50 naira. Yet the state oil company withheld $3.4bn to pay for
a subsidy that in effect did not exist. I have consistently held that
this was a scam that violated the constitution and siphoned off money
from the treasury.
The second major item raised in the
report relates to the transfer of oil assets belonging to the federation
to the Nigerian Petroleum Development Company, a subsidiary of the
NNPC.
NPDC has paid $100m for these assets,
from which it extracted crude valued at $6.8bn but paid tax and
royalties worth $1.7bn in the period scrutinised by the auditors. PwC
was unable to establish how much of the remaining $5.1bn should have
been remitted to the government. But the report showed that, along with
the private companies NPDC partnered with, it was extracting crude worth
billions of dollars but yielding very little revenue for the treasury. I
was investigating related transactions when I was suspended.
The third major item is a claim of
$2.8bn by NNPC for expenses not directly attributable to crude oil
operations; PwC said “clarity is required” on whether such upfront
deductions from remittances to the federation accounts are allowed, or
whether the money should have been remitted to the government. Finally,
there are duplicated expenses, “unsubstantiated” costs, computation
“errors” and tax shortfalls; a total of $1.48bn has to be refunded.
Of the $18.5bn in revenues that the
state oil company did not send to the government, about $12.5bn appears
by my calculations to have been diverted. And this relates only to a
random 19-month period, not the five-year term of Mr Jonathan, the
outgoing president.
Nigerians did not vote for an amnesty
for anyone. The lines of investigation suggested by this audit need to
be pursued. Any officials found responsible for involvement in this
apparent breach of trust must be charged.
The writer is the emir of Kano and a former governor of the Central Bank of Nigeria
No comments:
Post a Comment