Nigeria’s House of Representatives Committee on Petroleum (Downstream), is currently pushing for an upward swing of the pump price of petroleum products in the country.

Chairman of the panel, Joseph Akinlaja, has expressed support for the removal of subsidy on Premium Motor Spirit, also known as petrol, as recommended by the International Monetary Fund (IMF).

Former and present Group Managing Directors of the Nigerian National Petroleum Corporation (NNPC) had earlier expressed fears that the current pump price of N145 per litre was no longer feasible. They claimed the amount does not correspond with the price-determining components of the commodity and the fluctuations of the foreign exchange rate.

Akinlaja who however, spoke in Abuja, the country’s capital city, described fuel subsidy as outdated, stressing that farm produce should be subsidised instead.

His seeming support for a fuel price hike came as the Senate ordered the Industry, Trade and Investment Minister, Okechukwu Enelamah, and the Acting Managing Director of the Nigeria Export Processing Zones Authority (NEPZA), Terhemba Nongo, to immediately return N14.3 billion of the agency’s 2017 budget votes to the treasury.

A letter by the Chairman of the Senate Committee on Trade and Investment, Mohammed Nakudu Sabo (APC Jigawa South West) threatened a ‘’serious legislative action’’ in the event of non-compliance.

The anger of the panel, according to Sabo, who briefed reporters yesterday in Abuja, followed the alleged questionable manner the fund was ‘’hurriedly transferred from NEPZA account into that of a private company called Nigerian Special Economic Zone Company between eighth and 10th of this month despite earlier warnings.’’

The legislator is claiming that the money was first warehoused in the agency’s account with the Central Bank of Nigeria (CBN) from its 2017 budget allocations before allegedly being moved into the private company’s account about two weeks ago.

‘’To prevent this fraud, my committee wrote a letter to the CBN Governor, Godwin Emefiele on the eighth of this month not to release the money but very annoyingly, the money is confirmed to have been released and transferred by NEPZA in collaboration with the minister into a private company account. This is unacceptable and will not be condoned, hence the need for the money to be returned to the national treasury’’, he said.

In the letter dated April 25, 2019 and titled Re: Transfer of N14.3 billion from NEPZA Account to Nigeria Special Economic Zone Company and addressed to the minister, the senate committee noted: ‘’Pursuant to Section 80(2)(3) and (4) of the 1999 Constitution (as amended) and Financial Regulation Sections 313 and 314 and the Senate Standing Order 98, 14(a-s) of 2015 (as amended), we hereby write to you on the above matter.

‘’That you should return the N14.3 billion transferred from NEPZA account to the Nigeria Special Economic Zone Company. That the transferred money must be returned to the treasury within one week from the date of receipt of this letter, and that failure to comply with this directive will be visited with an appropriate legislative action against your ministry as well as the company.”

The NEPZA boss, had earlier this month during the 2019 budget defence of his agency, contended that the warehousing of the fund was transparently carried out, maintaining that the action was consistent with the nation’s Industrial Revolution Plan and got approval in the wake of a memo submitted to that effect by the minister in June 2018.

He decried that the Federal Government had continued to make the payments without appropriation by the National Assembly.

In the mean time, Akinlaja said, ‘’IMF will talk to us in an advisory capacity; they don’t run our government for us. It is the government that is supposed to take the decision. But as somebody who has been in the industry for more than 40 years, I believe that the issue of subsidy for petroleum products is outdated. Nigeria does not have the discipline to operate subsidy in whatever form.

‘’Subsidy is good for agriculture. I have been in the forefront, for more than 20 years, fighting against removal of subsidy, believing that the Nigerian government or the people responsible will act like America that we copy all the time, it subsidises agriculture.

‘’For farmers not to go out of business, if they produce in America, there are agencies to buy the produce from the farmers and preserve them, so that the farmers can produce next year. But here, it is the middlemen who are being subsidised in our Nigerian situation.’’

According to him, the amount being spent on subsidy was only known to the Nigerian National Petroleum Corporation and the Minister of Petroleum Resources.

While President Muhammadu Buhari is the Minister of Petroleum Resources, Dr Ibe Kachikwu is the Minister of State for Petroleum Resources and Chairman of the Board of the NNPC, ‘’I cannot tell you how much is being paid on subsidy. We will know that if the government has come to the parliament to ask for a specific amount, based on our specific consumption for the year, for appropriation. If they have not come here, we cannot answer the question. It means that it is only the NNPC and the Minister of Petroleum Resources that can answer the question.

‘’As for the issue of subsidy, I believe that there is a subsidy that is being paid in whatever name it is called. The executive is responsible for the supply and the distribution of petroleum products in Nigeria. The same executive said petrol especially – because that is the issue now- should as a matter of policy not sell more than N145 per litre. And the same government, specifically the NNPC, at a time last year during the scarcity, said the landing cost was N171.50.

‘’If oil marketers are instructed not to sell more than N145, and the same government talks about N171.50 as the landing cost, who is paying the difference of  N26.50? Somebody must be paying. Definitely, it has to be the government. As the Chairman of the Committee on Downstream, when we took on the Ministry of Petroleum Resources, what we heard (from them) was under-recovery. What is under-recovery? Somebody is paying for something. So, I concluded in my mind as a knowledgeable person that the N145 per litre is being subsidised.’’

IMF Managing Director, Christine Lagarde, at a press conference at the recent joint annual spring meetings with the World Bank in Washington DC, had called on the Federal Government to remove fuel subsidy, saying it was the right thing to do.

Lagarde had stated that with the low revenue mobilisation that existed in Nigeria in terms of tax to Gross Domestic Products, it was important for the country to remove fuel subsidy. By so doing, she opined, the country would be able to move funds into improving health, education, and infrastructure.

Responding, the Federal Government had stated that there were no plans to remove fuel subsidy in the immediate.

The Minister of Finance, Mrs Zainab Ahmed, had said, In Nigeria, we don’t have any plan to remove fuel subsidy this time because we have not yet designed buffers that will enable us to remove subsidy and provide cushions for our people. So, there is no plan to remove fuel subsidy.