Subsidies, globally, are an integral part of good governance. However, in Nigeria, they predominantly serve the wealthy, by the wealthy, and for the wealthy. Highlighted here are several instances of manipulation, showcasing how substantial sums of money could be recovered not just to subsidize fuel but also to foster national development.
1. Diversion of N40 billion from Federation Account
Continental Transfert Technique, engaged by the Ministry of Interior, unlawfully collects the Combined Expatriate Residence Permit and Alien Card (CERPAC) Fee, amounting to an average of N40 billion annually. Despite court orders directing remittance to the Federation Account, the contractor and the federal government persist in sharing these funds unlawfully.
2. Additional Revenue of $1.5 billion payable to Federation Account
Despite expired fiscal incentives, the Federal Government failed to act until a Bill was initiated, later modified and passed by the 9th National Assembly, ultimately increasing the nation’s revenue by no less than $1.5 billion annually.
3. Outstanding royalties of $62 billion
Despite a court order to collect outstanding royalties owed by International Oil Companies (IOCs), the Federal Government has neglected to recover the admitted $62 billion in outstanding royalties.
4. FG denied revenue of $500 million by a group of corrupt public officers
The Cargo Tracking Note Scheme, intended to safeguard shipping and prevent dangerous cargo movement, was repeatedly suspended due to corruption, resulting in a loss of at least $500 million and compromising national security.
5. Sale of public assets and enterprises
Privatization led to asset stripping, with 142 public enterprises sold between 2004 and 2002, contrary to provisions of the Privatization and Commercialization Act.
6. $7 billion fixed in 14 banks
The CBN deposited $7 billion in commercial banks in 2006, failing to recover both the deposit and accrued interests from the banks.
7. Sale of Heritage Bank, Keystone Bank, Union Bank, and Polaris Bank by CBN
CBN’s investment in revitalizing banks resulted in inexplicable sales, such as selling Polaris Bank for N50 billion after investing N1.3 trillion.
8. Theft of Crude oil
Nigeria lost 619.7 million barrels of crude oil valued at N16.25 trillion ($46.16 billion) to theft between 2009 and 2020.
9. Theft of gold and other solid minerals
Illegal smuggling of gold resulted in significant financial losses, with Nigeria losing close to $54 billion from 2012-2018 due to this activity.
10. AMCON is owed N5.4 trillion by the rich
AMCON’s inability to recover loans totaling N5.4 trillion from around 370 corporate bodies jeopardized commercial banks.
Commercial banks faced collapse due to toxic loans taken by the ruling class. The Federal Government established the Asset Management Corporation of Nigeria (AMCON) to purchase these loans using trillions from the CBN. However, AMCON has failed to recover N5.4 trillion from approximately 370 corporate bodies.
11. Indiscriminate import duty waivers
Privileged business community members benefit from importing goods by purchasing dollars at the official rate. Over the last 5 years, import duties worth N16 trillion were waived for them.
12. Effort to track and monitor tankers conveying fuel sabotage by NNPC
The Federal Executive Council (FEC) approved a N17 billion scheme under the Petroleum Equalisation Fund (PEF) to monitor fuel-conveying tankers, but the technology was never acquired, and the approved funds were diverted.
13. N10 trillion diverted by CEOs of Government enterprises
Government enterprises, including the CBN, withheld about N10 trillion in unremitted operating surplus as of August 2018, remaining unpaid till date.
14. N6 trillion unpaid ground rents by buyers of Government properties
Since 1992, over two million houses were built and allocated by the federal government without evidence of ground rent payment, prompting the Senate to initiate recovery of over N6 trillion unpaid ground rents from property owners.
15. Stolen crude oil valued at $29.17 billion
NIMASA-affiliated lawyers confirmed the illegal export of 60.2 million barrels of crude oil worth $12.7 billion to the USA between January 2011 and 2014, alongside $17 billion worth of undeclared crude oil exported globally. Despite identifying the companies involved, the government has yet to take action to recover the $29.7 billion stolen crude.
16. Oil theft of N16.25 trillion
NEITI highlighted Nigeria’s loss of 619.7 million barrels of crude oil worth N16.25 trillion ($46.16 billion) to oil theft between 2009 and 2020. Despite this, security forces couldn’t halt the stealing and smuggling. Tantita Security Services Nigeria Ltd (TSSNL) discovered pipelines diverting crude from a Forcados pipeline, yet indicted companies, including an IOC, remain unprosecuted.
17. Deduction of collection costs by FIRS & NCS
FIRS and Nigeria Customs Service deducted N533.39 billion and N128.64 billion respectively between 2016 and 2022 as collection costs, contrary to the Constitution’s Section 162, mandating all revenues be paid into the Federation Account.
18. Diversion of $6.065 billion approved for refinery maintenance
Between 1993 and 2016, NNPC spent $6.065 billion for refinery maintenance, unaccomplished. Contractors should refund this sum through EFCC’s intervention.
19. Investment in Dangote refinery and rehabilitation of 4 refineries
The Federal Government allocated $2.7 billion to Dangote Refinery, engaging the NNPCL to supply 300,000 barrels of crude oil daily. Contracts for Port Harcourt, Kaduna, and Warri refineries’ rehabilitation, costing $1.5 billion and $1.4 billion respectively, are underway. Labor unions are urged to oversee these projects.
20. Special salaries, security votes, and pensions for public officers
Senior public officers received special salaries, including National Assembly members earning between N13 million to N15 million monthly, plus security votes amounting to about N241 billion annually. State governors enjoyed excessive pensions, but some states like Lagos, Kwara, Imo, and Zamfara have taken steps to halve or abolish these payouts, setting an example for other states to follow suit.
21. Diversion of dividend and feed gas of $33 billion by NNPCL
Former President Buhari revealed NLNG’s substantial revenues, including $33.9 billion in dividends and feed gas. However, rather than depositing these funds into the Federation Account as mandated, they were diverted by NNPCL.
22. Diversion of trillions of Naira through fuel subsidy fund
The fuel subsidy issue has been a major concern, with confirmed staggering amounts spent on fuel importation between 1999 and 2023. The recent revelation by the CEO of NNPCL, Mele Kyari, about the government owing N2.8 trillion in fuel subsidy payments further exposed the monumental fraud within the subsidy system.
The need for a probe into this criminal enterprise has been emphasized by former Minister Timipre Sylva due to its encouragement of smuggling and its negative impact on the nation’s oil resources.
In conclusion, the disparities in subsidies benefitting the ruling class while the masses face economic challenges demand action. Calls to stop the dollarization of the economy, halt indiscriminate duty waivers, and recover looted wealth are crucial, along with fixing refineries to provide genuine subsidies that enhance the quality of life for Nigerians.
The concerns highlighted are indeed alarming:
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