Probe missing $2.1bn, N3.1trn subsidy payments or face legal action, SERAP tells Tinubu

By Abubakar Yunus, Abuja Socio-Economic Rights and Accountability Project

(SERAP) has urged President Bola Ahmed Tinubu to “set up a presidential panel of enquiry to promptly probe the grim allegations that US$2.1 billion and N3.1 trillion public funds of oil revenues and budgeted as fuel subsidy payments are missing and unaccounted for between 2016 and 2019, as documented by the Auditor-General of the Federation.”

SERAP urged him to “name and shame anyone suspected to be responsible for the alleged widespread and systemic corruption in the use of oil revenues and the management of public funds budgeted as fuel subsidy, and to ensure their effective prosecution as well as the full recovery of any proceeds of crime.”

SERAP also urged him “to promptly, thoroughly, independently, transparently and effectively probe all fuel subsidy paid by successive governments since the return of democracy in 1999, and to use any recovered proceeds of crime as palliatives to address the impact of any subsidy removal on poor Nigerians.”

In the letter dated 3 June 2023 and signed by SERAP deputy director Kolawole Oluwadare, the organisation said: “There is a legitimate public interest in ensuring justice and accountability for these serious allegations. There will be no economic growth or sustainability without accountability for these human rights crimes.”

SERAP said: “Your government should urgently act to follow due process of law in any policy to remove fuel subsidy, ensure that suspected perpetrators of these crimes against Nigerians are brought to justice and full recovery of any missing public funds.”

SERAP also said, “Arbitrarily removing fuel subsidy without addressing outstanding accountability issues in the alleged mismanagement of oil revenues and fuel subsidy payments would amount to punishing poverty and further impoverishing the poor while letting high-profile officials and non-state actors get away with their crimes.”

The letter, read in part: “Any removal of fuel subsidy should not be used as a ploy to keep the poor in poverty while those who allegedly stole oil revenues and fuel subsidy payments keep their ill-gotten wealth.”

“Allegations of corruption in oil revenues and fuel subsidy payments suggest that the poor have rarely benefited from the use and management of the revenues and payments.”

“Poor and socio-economically vulnerable Nigerians should not be made to continue to pay the price for the stealing of the country’s oil wealth while state and non-state actors pocket public funds.”

“We would be grateful if the recommended measures are taken within 3 days of the receipt and/ or publication of this letter. If we have not heard from you by then, SERAP shall take all appropriate legal actions to compel your government to comply with our request in the public interest.”

“The proposed panel should be headed by a retired justice of the Supreme Court or Court of Appeal, and its members should include people with proven professional record, and of the highest integrity that can act impartially, independently, and transparently.”

“A comprehensive approach that prioritises accountability and full recovery of missing crude oil and public funds is required to address the problems of the implementation of fuel subsidy since 1999.”

“According to the audited reports between 2016 and 2019 by the Auditor General of the Federation (AGF), the Nigerian National Petroleum Corporation (NNPC) failed to remit N663,896,567,227.58 into the Federation Account. The AuditorGeneral fears that the money may be missing.”

“The NNPC also reportedly failed to account for the allocation of crude oil to refineries in 2019. 107,239,436.00 barrels of crude oil were lifted as domestic crude without any document. The Auditor-General fears that the crude valued at N55,891,009,960.63 may have been diverted.”

“The NNPC in 2019 also failed to remit N1,955,354,671,268.66 and N55,157,702,848.74 of generated revenues into the Federation Account, contrary to Section 162(1) of the Nigerian Constitution 1999 [as amended]. The Auditor-General fears that the money may have been diverted.”

“The NNPC also failed to account for N4,572,844,962.25 of ‘domestic gas receipts’, thereby ‘reducing the distributable revenue in the Federation account.’ The Auditor-General wants the money remitted.”

“The NNPC also in 2019 failed to account for 22,929.84 litres of PMS pumped from refineries and valued at N7,056,137,180.00. The Auditor-General fears that the PMS may have been diverted.”

“The NNPC also ‘illegally classified’ 239,800 barrels of crude oil valued at N5,498,045,220 as ‘crude oil losses.’ The AuditorGeneral fears that the crude oil may have been diverted.”

“The Department of Petroleum Resources (DPR) in 2019 also reportedly failed to remit US$1,278,364,595.49 in revenue to the Federation Account. The money was deducted by the NNPC from the Oil and Gas Royalty assessed by the DPR.”

“The DPR in 2019 also deducted N19,840,081.29 as ‘stamp duty’ payments from contractors and consultants but the DPR instantly paid back the money to the contractors and consultants instead of remitting it to the treasury.”

“The DPR in 2019 also paid N137,225,973.35 to contractors and consultants for various contracts and consultancies but failed to deduct stamp duty. The Auditor-General wants the money recovered.”

“The DPR also paid N11,856,088,271.92 as salaries for 2019 but failed to deduct N118,560,882.72 as contribution of 1% Industrial Training Fund (ITF). The DPR in 2019 also failed to transfer US$35,738,342.95 year balance. The Auditor-General wants the money recovered and remitted.”

“The DPR in 2018 also withdrew without any explanation US$759,387,755.10 from DPR Signature Bonus Account rather than paid the money into the Federation Account.”

“Subsidy records show that N443,940,559,974.80 was paid as total subsidy for 2016 but the money was not budgeted for. The payments were for outstanding Petroleum Support Fund (PSF) commitments for year 2015.”

“However, there was no payment in 2016. Only outstanding payments for previous years 2014 and 2015 and interest payments were made in 2016.”

“The Auditor-General fears that the oil marketers that received the subsidy payments may not have been ‘eligible to draw from the Petroleum Support Fund as the Petroleum Products Pricing and Regulatory Authority (PPPRA) failed to provide any document on the payments.’”

“N39,141,210,181.74 was also paid from the Federation Account in 2016 to different Oil Marketers in 26 transactions, being Payments of Interest and Foreign Exchange Differential on Subsidy but without any document.”

“The NNPC also made ‘zero profit’ and recorded ‘losses from its joint ventures in 2016. This is contrary to expectations that profits should be made from the joint ventures.’”

By Abubakar Yunus Abuja

The Nigerian Civil Aviation Authority (NCAA) has rejected an application by Nigeria Air to proceed to phase two in the process of obtaining its air operators certificate (AOC).

In a letter seen by TheCable, dated June 2, 2023, NCAA said due to the unavailability of a “formal application form” and other “necessary documents”, the certification process cannot progress to phase two.

“The authority is in receipt of your letter dated May 25, 2023, on the above subject matter,” NCAA said.

“Quite contrary to our earlier letter of 16th May 2023, which enumerated the documents to be submitted with the formal application form OPS 002, your letter of request to proceed to phase two has no inclusion of a formal application form and the necessary documents referenced in the formal application form.

“Hence, the certification process cannot progress to phase two without these required documents.

“Please be reminded that your post holders’ letters of commitment to Nigeria Air have a tenure of three months and as such expire now. “

A year ago, the federal government granted an air transport license (ATL) to Nigeria

Air to commence operation.

NCAA rejects Nigeria Air’s request to proceed to phase two of AOC acquisition NCC begins issuance of licences to mobile virtual network operators

But the proposed national carrier has been unable to complete the requirements for the issuance of the AOC, which — among other requirements for an airline to operate — is a note of authority issued to airlines that fully guarantees them the right to begin air services.

There are five stages involved in acquiring the AOC, according to NCAA.

In phase one, NCAA appoints a certification team and processes the pre-application statement of intent form (AC-OPS 001). Discussions on all regulatory requirements, the formal application and attachments, and any other related issues will take place.

This process usually takes a week to complete.

Moving to the second phase, a formal application for intending entrants where documents and manuals (including the curriculum vitae of key management personnel) must be submitted for evaluation. The minimum timeframe for the formal application phase is two weeks.

The third stage involves a document evaluation, where the NCAA will review the applicant’s manuals and other related documents and attachments to ensure conformity with the applicable regulations and safe operating practices.

The minimum timeframe for the document evaluation phase is three months.

From there, NCAA’s scrutiny moves to the fourth stage: the demonstration and inspection — a key phase of the process carried out only after a satisfactory documentation evaluation phase.

In this stage, a thorough audit by the certification team at the applicant’s premises will be conducted to ensure that the proposed procedures are effective and that the applicant’s facilities and equipment meet the NCAA’s regulatory requirements.

Also in phase four, other demonstrations like the emergency evacuation and ditching will be carried out, and after successes in these exercises; a demonstration flight will be carried out. The minimum timeframe for the demonstration and inspection phase is two months.

The fifth and final phase is certification and this means once the airline has met the regulatory requirements of the civil aviation (air navigation) regulations, the NCAA will issue the AOC with the appropriate specifications and ratings.

The minimum timeframe for the certification phase is one week, and after the issuance of the AOC, the applicant can engage in commercial aviation activities in Nigeria.

On May 26, 2023, the federal government unveiled Nigeria Air in the country’s capital city amid controversy over its ‘inaugural’ aircraft.

Prior to its launch, domestic aviation firms, under the aegis of Airline Operators of Nigeria (AON), had opposed the floating of the airline over uncertainties in its ownership structure — a conflict that began soon after Ethiopian Air was announced as the preferred bidder for Nigeria Air.

A federal high court in Lagos consequently restrained the government from floating the airline.

As a result, the airline missed its operation deadline several times.

However, Hadi Sirika, former minister of aviation, continued to reiterate that the national carrier would fly before May 29.

When an aircraft intended for the use of Nigeria Air landed in Abuja on May 26 — three days to the end of Sirika’s tenure — the minister assured that a demonstration flight (usually in the fourth stage) would commence soon.

“So, this airplane will be here and we will commence the demonstration flight to show that we can do it. It is normally around 0-40 hours but it can be less. It can be five or even two hours and this is to ensure that we are able and have the capacity to do it,” he had said.

The Nigerian Communications Commission (NCC) says it has begun the issuance of licences to mobile virtual network operators (MVNOs) in the country.

An MVNO is a company that does not own a mobile spectrum license but sells mobile services under its brand name using the network of a licensed mobile operator.

Mohammed Babajika, director, licensing and authorisation, NCC, spoke during a recent two-day stakeholders consultative forum ‘Talk-To-The Regulator’, held in Yenagoa, Bayelsa state.

He disclosed that the commission has finalised the framework for MVNOs and was currently in the process of licensing them.

Babajika said the licensing of MVNOs will improve the telecommunication output of the country, enable the expansion and availability of quality mobile coverage and close the gap between the unserved and underserved population in Nigeria.

“While the commission is fully committed to discharging its mandate, it can only achieve this with the cooperation and support of licencees,” Babajika said.