• Okonjo-Iweala also clears NNPC
CENTRAL Bank Governor Sanusi Lamido Sanusi shocked the Senate Wednesday as he openly admitted that his claim that $49.8 billion crude oil fund was missing was an error on his part.
In a verbal presentation before Senate Committee on Finance, Sanusi, however declared that so far, only about $12 billion was found to have been the shortfall in the oil fund remittance.
He, therefore, pleaded with the Senator Ahmed Makarfi-led committee to grant him some time to reconcile figures and facts with other relevant Ministries, Departments and Agencies (MDAs).
Also at a joint press briefing attended by the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke and Nigerian National Petroleum Corporation’s (NNPC) Group Managing Director, Andrew Yakubu, the Minister of Finance and Co-ordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, clarified the matter.
Sanusi’s submission that $12 billion was the amount yet to be remitted attracted a swift reaction from the Minister of Finance and who promptly informed the committee that only $10.8 billion was yet to be reconciled.
The committee therefore directed the CBN and all the relevant MDAs to conduct comprehensive reconciliation and report back in writing separately as soon as the process was concluded.
Sanusi said: “I repeat Mr. Chairman that we did not see the letter as a conclusion of our investigation but an invitation to investigate. So, the conclusion that $49.8 billion was missing was wrong even though we had the allegation that it was not remitted.
“I found it very unfortunate it was leaked to the press and the answer is ‘Yes’, the CBN Governor did send that letter with those contents. By way of those contents, the Central Bank and Finance Ministry and the government were very much concerned over the years at the very low rate of accretion to the reserves in spite of very high level of oil prices and in particular, depletion of excess crude account in spite of what seems to be very high level of oil sales.”
He maintained that the letter was aimed at unveiling areas of leakages, leading to discrepancies between high level of sales and depleting Excess Crude Account.
He went on: “Now, in investigating and trying to understand where those leakages were, our attention was drawn to a huge difference between what appeared to be export of crude made by the NNPC and amount repatriated into the crude equity account of the Federal Government.
“The numbers were about $65 billion exported by NNPC and about $15 billion repatriated to Federation Account out of that. Now, in line with our duty as the banker of the government, we had the responsibility of alerting the President and request a thorough investigation of this matter.
“Since then, a lot has happened. We have had the Minister of Finance, Minister of Petroleum Resources, Central Bank, Federal Inland Revenue Service (FIRS) and the Department of Petroleum Resources (DPR) set up technical team and have started a process of reconciliation and there has been a lot of progress in that process.
“That progress has been the provision of Monetary Policy (MP) by Monetary Policy Committee officials to show that even though they did ship that amount in question, which is little more than $67 billion, about $24 billion was actually not their crude but crude shipped on behalf of third parties like oil companies, tax in crude and also for third party financing and that already addressed half of the amount.
“So, the second half is the issue around domestic crude lifting of $28 billion from which we feel there is a shortfall. There is a general consensus among us on this even though the amount has been disputed. For us in Central Bank, there is a shortfall of $12 billion.
“Now, we still are in the process of trying to reconcile that number and we have not even started talking of the sales, the export sales tax, which is about $2 billion, which will come after the sales tax and the Finance Ministry has told us that even before now, there is ongoing negotiation and discussion with NNPC ad-hoc committee and these numbers have always been discussed at the level of commissioners of finance.”
Sanusi prayed that since the objective of the committee and every Nigerian was to find the missing link, more time should be granted them to conclude reconciliation.
His words: “Since the objective of this committee and for all of us on this side is actually to get to the bottom of it and find out exactly what is the amount unremitted and what is to be done and recommend actions, what I would like to do is, given the progress we have made, to request that we be given little more time to continue with this process and come back with the final position that is a common position among us if the committee will so grant us.”
However, an attempt by Senator Clever Ikisikpo, Bayelsa State, to question the rationale behind the letter before reconciling accounts with relevant agencies, was frustrated by the committee’s chairman who claimed it was immaterial.
Ikisikpo said: “I appreciate your submission but I want to know from you, before you write that kind of a letter...”
Makarfi interrupted: “You should not go into that.”
Ikisikpo: “OK.”
According to the chairman, there was no disagreement over the issue of reconciliation rather, the committee should be concerned about the outcome of the reconciliation.
He said: “I have not seen any dissenting issue. The condition is a crucial one. First of all, from my understanding, the CBN governor has said that he didn’t say money was missing but there may be unremitted revenue, whether that revenue is kept somewhere is to be established.
“Secondly, I take it from the verbal summary letter that he has submitted that whatever letter he must have written, which gave a particular figure of about $49.8 billion to be reconciled, it looks like at this moment, what may need to be reconciled is about $12 billion judging from his submission and that they are in the process of reconciling that.”
“Right now, you can see that still between them, they still have some differences. I am only talking about what he said and the critical thing is that he has called for more time for all parties to sit down a d reconcile.
“At the end of the day, you are not going to agree with one another. We hope you do but where you don’t, we have written letters to each of you to give us written submissions and we still expect the written submissions after the reconciliation so that when we come to proper details of proceedings, we will have those proceedings based on written submissions by you after you have exhausted the reconciliation procedures.
“Don’t go to consultants to respond to our letters, once you have reached conclusive reconciliation, individual agencies should respond, giving us in writing, all the issues we asked to be addressed,” he said.
Okonjo-Iweala noted that the preliminary findings of the joint reconciliation exercise reveals clearly that the said missing crude oil proceeds are not missing but intact and in the system.
“What we have done so far shows that for the $49.8 billion, and that’s the first point we want to make, there are some perhaps misconceptions or misunderstandings that led to this number and we have been able to come to the conclusion that we can account for this amount,” Okonjo-Iweala stated.
She stated that this conclusion was reached after a closer and extensive scrutiny of the books by all parties involved.
“I just want to say that this reconciliation is still an ongoing matter, but we thought at this point in time after working last night that we could share with you some of our thoughts and clarifications on this issue. And that is why we are here to resolve this and get to the bottom of this,’’ she said.
“So, the bulk of the sum of $49 billion has been accounted for and that is what the reconciliation exercise is about. So it is very clear that this is not missing.’’
Alison-Madueke on her part stated that the robust reconciliation meetings over the last couple of days have revealed a very clear understanding and most part of the said amount has been accounted for.
“There is a shortfall as mentioned but it has been known for quite some time. It is an open record in FAAC and has been discussed severally. It has been an acknowledged by NNPC but the extent of the shortfall has also been disputed by NNPC for some time and so we have an ongoing reconciliation efforts on that particular shortfall,” she said.
Earlier, while declaring the hearing open, Senate President David Mark submitted that the upper chamber has no position on the allegation.
He, however, admitted that it was a serious allegation and the essence of the hearing was to establish facts.
“The Senate has no position on it except those published in the newspaper. The committee’s body language must be seen to be neutral,” Mark said.
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