The Joint Committee of the Senate investigating the management of fuel subsidy in the country on Thursday discovered the payment of N192.5bn as subsidy on excess petroleum importation.The Group Managing Director, Nigeria National Petroleum Corporation, Mr. Austen Oniwon, had informed the committee that Nigerias daily consumption requirement of Premium Motor Spirit was 40 million litres but that about 17 billion litres had been imported in the last 10 months.Further checks by the committee revealed that the 40 million-litre daily consumption figure would have meant that a total of 14.5 billion litres should have been supplied between January and October 2011.It was discovered that NNPC had imported excess 2.5 billion litres of PMS; an action the committee said had substantially increased the subsidy bill chargeable to revenues accruable to the Federal Government.The NNPC confirmed that it was paid N77 as subsidy on each litre of fuel, thus translating to N192.5bn excess subsidy payment within the period.The total amount provided in the 2011 budget for subsidy payment was N245bn, but according to the Minister of Finance, Mrs. Ngozi Okonjo-Iweala, the subsidy bill had gone up to N1.54tn as at October 2011.While questioning Oniwon, Senator Bukola Saraki, noted that the excess fuel importation was enough to increase the subsidy bill substantially, noting that the revelation was important to the investigation."I think with this, we have achieved something today. This amount of product is in excess of what we require on a daily basis. We have only computed this for 10 months; we can go backwards and will see another area we can look into," he said.Defending the figures, Oniwon argued that NNPC was keeping petroleum products reserves that could last the country for 54 days as a back up in case of problems in the importation channel.He said the excess imported products went into the 54-day reserves, adding that importation was also subject to other vagaries ranging from failure of marketers to import and delays in the arrival of products.The committee also queried the deduction at source of N1.3tn for the payment of subsidy in excess of what was provided in the 2011 budget.Although Oniwon defended the action on the grounds that the corporation was empowered by the Appropriation Act to deduct from the revenues accruable to the Federal Government before paying the balance into the Federation Account, the committee faulted the deductions in excess of what was provided for in the Act.The NNPC boss said, "We did not breach the Appropriation Act, NNPC has never taken any money from the Federation Account because by law, no money comes to the NNPC from the Federation Account."The Act allows us to deduct from source for the payment of fuel subsidy and that is what we follow."The Minister of State for Finance, Dr. Yerima Ngama, said what was provided for in the budget was only sufficient for the payment of subsidy for two months alone.He noted that payment for the remaining months had to come from other sources since it was not provided for in the budget.The committee has meanwhile ordered the Minister of Finance to submit the report of the audited certificates for the importation of petroleum products or risk being subpoenaed.Okonjo-Iweala had pleaded with the committee to allow her time to study the audit report before submitting it, arguing that she had not read it and would not be able to give a specific date for its submission.But the committee resolved that she did not need to read the report before submitting it and gave her seven days to make the report available.
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