By Nse Anthony-Uko
ABUJA, (Sundiata Post) – The Nigerian National Petroleum Corporation (NNPC) and its upstream arm, the Nigerian Petroleum Development Company (NPDC), have failed to remit $21.778 billion and N316.074 billion respectively to the Federation Account, the Nigeria Extractive Industries Transparency Initiative (NEITI) said in a policy brief released on Tuesday.
Accordingly, NEITI has urged the Federal Government to deploy machineries to recover over $21 billion unremitted funds to fast-track the nation’s economic recovery from the current recession.
The Executive Secretary of NEITI, Waziri Adio noted that the huge unremitted funds if recovered are more than enough to jump-start the economy instead of borrowing or selling the nation’s assets.
“Total unremitted revenues to government’s treasury amounted to $21.778 billion and N316.074 billion. At the current exchange rate, this comes to about N7.2 trillion. Achieving a recovery rate of just 20 per cent would significantly offset the projected deficit for the 2017 budget. A third of the computed unremitted revenues would completely eliminate the need to borrow to finance the budget. This has both short and long-term positive implications for the economy,” he stated.
Mr. Adio reaffirmed NEITI’s commitment to support the efforts of the government to recover diverted or unremitted funds through the provision of timely information and data.
According to him, NEITI in an effort to ensure that the government take steps to recover the unremitted funds it has presented the content of its policy brief which focused on unremitted funds, economic recovery and oil sector reform to the economic management team under the leadership of the Vice President Prof. Yemi Osinbajo.
The NEITI Policy Brief which is an audit of the oil and gas sector revealed that the Nigerian National Petroleum Corporation (NNPC) alongside its upstream subsidiary, Nigerian Petroleum Development Company Limited (NPDC) failed to remit $21.778 billion and N316.074 billion to the Federation Account.
“These are amounts due from three main sources: Federation assets divested to NPDC and NPDC’s legacy liabilities, payments for domestic crude allocation to NNPC; and dividends from investment in Nigerian Liquefied Natural Gas Company (NLNG) paid to but withheld by NNPC,” Mr. Adio stated.
Adding that, “Recovery of these funds will significantly enhance government’s fiscal position in the short term.”
Speaking on the position of NEITI as it concerns the said unremitted funds, the Executive Scribe of NEITI said, “We recommended urgent measures to recover the funds to support the on-going economic recovery plan.”
While urging the government to go beyond the recovery of the said funds, NEITI recommended that adequate measures be put in place to ensure that such diversion of national assets is averted.
NEITI therefore requested the government take the following steps, Revaluation of the assets diverted to NPDC to determine the actual market price with a view to recovering the full value of the assets and securing optimal benefit from them; Review of the relationship between NNPC, NPDC and the Federation to determine and establish effective lines of accountability of NNPC’s subsidiaries, and determine optimal mode of operation in line with global best practices; and Review of the process of acquisition of OMLs by NNPC and NPDC to ensure that long-term net positive value is realized given the availability of alternative economic options.