The Chairman of the Revenue Mobilisation, Allocation and Fiscal Commission, RMAFC, Engineer Elias Mbam has yesterday said that the Federal Government overinflated the amount of money it spends on subsidising petroleum products.
Engineer Elias Mbam said this when he appeared before the Farouk Lawan-led committee of the House of Representatives investigating the subsidy regime, saying the whole subsidy regime was shrouded in secrecy, fraud and corruption.
According to him, “We are not comfortable with the figures of N1.263 trillion because if you do little arithmetic by multiplying 35 million litres daily consumption and the N138 for nine months the amount is not up to N1 trillion.
“The management of subsidy is not clearly defined between the NNPC, PPPRA, finance and petroleum ministries; this has created doubt as to the true quantum of subsidy per litre and the total consumption in the country,” the RMAFC boss said.
Mbam also added that the Nigeria National Petroleum Corporation, NNPC, illegally deducted from source the sum of N615 billion within the said nine months in contravention of Section 162 of the 1999 Constitution.
The Finance Minister, Mrs Okonjo-Iweala, had earlier admitted before the Farouk Lawan-led committee that the N1.3million was only an estimated figure, saying that her ministry was still reconciling with the NNPC and the PPPRA.
Okonjo-Iweala, who is also the coordinating minister of the economy, said, “I want to say that many of the figures we have been giving are estimates. When we met with the Senate in October, we gave an estimate of N1.3 trillion. So, we are reconciling. So when we come back after having talked to our colleagues in NNPC, PPPRA, we should be able to give you accurate figures.”
In his submission, former RMAFC boss, Engineer Hamman Tukur told the legislators that subsidy does not exist at all, arguing that if the government insists that it exists, why did it ask Nigerians to pay?
However, the Petroleum Minister, Mrs. Diezani Allison-Madueke, said it was legal for the Nigerian National Petroleum Corporation (NNPC) to deduct monies meant for subsidy at source, arguing that section 5 (80) (3) of the 1999 constitution as amended empowers the corporation to deduct from source.
“I need to say clearly that we have done nothing unconstitutional as a ministry, particularly regarding deducting at source. We do not take money from the federally appropriated revenue,” she said.
The minister also added that the Federal Government actually spent N1.3 trillion instead of N245 billion appropriated by the National Assembly, which according to her, was meant for January and February, 2011.
Allison-Madueke also denied the existence of cabal in the oil industry, although President Goodluck Jonathan had admitted to the nation that cabal has been benefitting from the subsidy funds, making it difficult for the Nigerian masses to feel the impact of the subsidy regime.
She said, “I think I have to say at this time that I’m under oath and it will be most improper to speculate on the existence or not of the purported cabal. Let me say for the purpose of records that I think that we cannot afford as a country to criminalise either a certain group with one fell swoop or just as we cannot afford to criminalise the policy of subsidy itself. When you have a pool of marketers, many of whom are bonafide marketers, who do very legal job for this country, and I say this because I have been severally taken to task and called all sort of names for saying this, but as minister of petroleum resources, I think I have the courage to say.”