Beyond the mere release of the controversial PricewaterhouseCoopers (PwC) forensic audit report on the missing $20 billion oil cash, Nigerians want President-elect Muhammadu Buhari to take measures that will instill financial discipline in the Nigerian National Petroleum Corporation (NNPC), report Emeka Ugwuanyi, Okwy Iroegbu-Chikezie and Chikodi Okereocha.
WHEN President-elect Muhammadu Buhari spoke of plans by his administration to revisit the alleged missing $20 billion oil money, not a few Nigerians were excited. Since the release of the forensic audit report carried out by PricewaterhouseCoopers (PwC) on Monday, there have been criticisms, comments and reactions from stakeholders. The consulting firm, which expressed its frustrations in the course of forensically auditing the accounts of the Nigerian National Petroleum Corporation (NNPC), said in the report that $1.48 billion was not remitted into the Federation Account by the Corporation. Nigerians were dumb-founded by other shocking revelations in report’s executive summary. Amidst the furore generated by the controversial report, PricewaterhouseCoopers has clarified that what it did was a mere review and not a forensic audit per se.
Dr. Austin Nweze, an analyst and economist with the Pan Atlantic University, Lagos, feels conducting a further probe into the NNPC will be a waste of time because the more one looks into the NNPC account, the more one is lost and confused. He advised the incoming Muhammadu Buhari-led government not to further probe the alleged missing $20 billion. He said should Buhari go into probing the activities of the Nigerian National Petroleum Corporation (NNPC), he will spend the entire first four years doing that because NNPC stinks. Nweze stated that doing so will be a serious distraction and disservice to the nation. Nweze urged Buhari to exert his energies on identifying the loopholes through which public funds are siphoned and plugging them.
He said: “From the beginning, NNPC has been a conduit pipe through which government officials divert public funds. It didn’t start today. It was like that under the military administration. NNPC is where every government goes to get money. Everything about the corporation stinks and the mess didn’t start today. The issue of corruption in NNPC is beyond PricewaterhouseCoopers (PwC) report. The report could have covered a longer period, from at least 1999, because no such report had been done in the past. My advice to Buhari is to overlook the report and focus on identifying the loopholes. If he focuses on probing NNPC activities, his first four years will be dedicated to the rot in the Corporation.
“Subsidy should be removed completely because it adds undue extra cost on fuel. Besides, the removal of subsidy will encourage competition among entrepreneurs in that sector. It will encourage local investors to build refineries in the country. Oil marketers can import and sell at a competitive price. There will be free market entry and exit. Nigeria refines its crude in Singapore and it gets the right quality and quantity. In other countries, the government gets less. The removal of subsidy will stop all these on the long run as enough crude will be refined locally, thus reducing production cost.
“Also, if Buhari wants to probe the NNPC from the beginning, the culprits may plan against his government. It is a high-stake risk because of the caliber of people involved. My advice is that he should leave the sleeping dogs. But he should take measures to prevent institutional looting and stealing.”
On the transferred assets to NNPC subsidiary, the National Petroleum Development Company (NPDC), Nweze said the company should be compelled to provide all the required documents for a thorough audit. He also pointed out that the Federal Government is disadvantaged in the joint venture arrangements because it accepts whatever the International Oil Companies (IOCs) declare.
He said: “The government gets only about 20 per cent after the IOCs have deducted all their expenditures.
“The government lacks the expertise and the technological know-how to determine the quantity of oil being produced.
Matters arising
from the report
Also baring him mind on the proposed further probe, the Lead Director, Centre for Social Justice (CSJ), Eze Onyepkere said: “It is a welcome development that the president-elect will upon assumption of office probe the purported missing $20 billion oil cash. This will help to arrive at the veracity, truth, or otherwise of the allegation; expose and punish the culprit(s) as well as restore public confidence in the oil and gas industry.
“The demand for this fresh probe is accentuated by PwC’s affirmation that it was unable to give an opinion or attestation to the figures and it did not claim it had done an examination in accordance with the generally accepted accounting standards. It therefore did not vouch for the veracity and accuracy of the figures.
“It is unfortunate that the release of the PwC audit report did not come voluntarily but was forced by the president-elect’s threat to order a new probe. For an administration that signed the Freedom of Information Bill (FoIB) into law to be shielding such a document from the public speaks volumes of the administration’s commitment to transparency and accountability.
“However, what the sector needs is more than a probe of the missing $20 billion and the CSJ is calling for a probe of the entire NNPC management since the return to civil rule in 1999. There are no corresponding developments and disbursements to revenue accrued to the country in the last 15 years.
“Beyond the probe, CSJ calls for a fundamental restructuring that will separate the regulator from being an active player, introduce private sector efficiency and pave the way for investors to finance long-term transactions and projects in the oil and gas industry.
“It is a positive process of liberalisation that will create opportunities for Nigerians and their partners to be in a win-win situation and this will remove the constraints on Nigeria’s development.
“This will be a PIB (Petroleum Industry Bill) type of reform. It will addresse fundamental issues in the sector without creating new bottlenecks. It will yield more rents and taxes into the Federation Account, make gas available for power generation and increase the storage of processed gas for domestic use by industries and for export.
“This is not going to be a complex exercise. The foundations of this quick reform have been laid since 2005. All it takes is to dialogue with the incoming National Assembly on the PIB and the modification thereof, get same approved and assented to within two months after the inauguration of the new National Assembly.
“It is a shame that the outgoing administration of the Peoples Democratic Party (PDP) produced the president, the majority and leadership in the National Assembly but could not muster the political will to pass the PIB and act in the interest of Nigerians. Posterity will remember the men and women who had the opportunity to improve the economy of Nigeria but chose to play politics of retrogression in place of emphasising development.”
Ammendment of Fiscal
Responsibility Act necessary
Mr. Muda Yusuf, the Director-General, Lagos Chamber of Commerce and Industry (LCCI), who hailed the release of PwC report, said the incoming administration has a lot of cleaning up to do in the corporation.
Yusuf said: “It is important that we do away with this regime of fuel subsidy payments. The report has shown that the bulk of fraud emanated from fuel subsidy management. To prevent the economy from further haemorrhage, subsidy should be discontinued with and the savings used to provide critical infrastructure.”
The LCCI chief stated that the report also showed the dangers in taking an economic decision that allows government agencies to earn revenue and disburse same without first remitting such accruals.
He suggested that revenue-yielding agencies should be barred from spending whatever they generate without approvals.
Yusuf called for the amendment of the Fiscal Responsibility Act as a way of curbing extra budgetary disbursements by agencies.
In his remarks, the Vice President, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Mr. John Udeagbala, said the report has been over flogged. He said the alleged corruption in NNPC was already in the public domain, even as he commended the outgoing administration of President Goodluck Jonathan for making the report public to douse the rumours and controversies it has generated.
Udeagbala, an oil and gas sector operator, urged the incoming administration to hire another firm to conduct a fresh audit into the operations of the NNPC.
Release of audit report overdue
Obiora Akabogu, a Lagos-based lawyer and public affairs analyst, said the release of the report was long overdue.
“The exercise is timely. For a long time, NNPC’s account has been in the dark and the corporation has been a drain pipe to rip off Nigerians,” he told The Nation.
He noted that “this monumental fraud would have been swept under the carpet” but for the former Central Bank of Nigeria (CBN) Governor Lamido Sanusi, who blew the whistle.
The lawyer, who accused the National Assembly of compromising on its oversight function by giving NNPC a clean bill of health, urged the incoming administration to take advantage of the audit report by beaming its searchlight on NNPC.
According to him, taking such a measure will serve as a deterrent.
“I believe that economic rejuvenation of Nigeria should start with proper sanitisation of NNPC. It should no longer be business as usual,” Akabogu said. He described Buhari’s victory at the polls as a divine mandate to restore NNPC’s glory.
Asked whether the release of the report has any political interpretation or undertone, coming after a recent alarm by the All Progressives Congress (APC) that there were clandestine moves by the outgoing administration to doctore the books, Akabogu said the APC did the normal thing by drawing public attention to perceived corrupt tendencies.
“There is no timeline for combating corruption,” he said.
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