LEKAN SOTE FROM PUNCH
Some argue that if the government is spending 96.3 per cent of its revenue on debt servicing, while also satisfying other financial responsibilities for infrastructure, salaries and overheads, the government cannot afford any palliatives.
Yet others vehemently insist that government’s revenue shortage is a result of the trick of the Nigeria National Petroleum Company Limited that is moving funds from one arm to another, what accountants describe as accounting within account.
Here is the explanation, as someone, who has never worked in NNPCL or its precursor, NNPC, offered from the inside of a Lagos “danfo” commuter bus. He says NNPCL sells crude petroleum and earns revenue denominated in American dollars.
That is simple enough to understand, given the understanding between America and Saudi Arabia to lead members of the Organisation of Petroleum Exporting Countries to sell crude petroleum in American dollars.
He adds that, in order to create an opportunity to earn foreign exchange for the rascals who run the Nigerian state and their cahoots, the denizens of NNPCL (deliberately) neglect to run the four government-owned refineries.
Yet thousands of people are hired (to idle away doing nothing at the refineries) only because they are protégés of Nigeria’s oligarchs. Okay, they at least run the petroleum products depots, manage the petrol pipelines and take delivery of imported petroleum products at the Atlas Cove, off Lagos harbour.
But because Nigerians need petroleum products, like petrol, diesel, kerosene and black oil, in order to run their lives within the Nigerian economic space, the operatives of NNPCL resort to importation.
This habit that was adopted from the time when the National Union of Petroleum and Natural Gas Workers, led by its Secretary General, Frank Kokori, locked down the oil sector to compel Gen. Sani Abacha to reverse the annulment of June 12, 1993 presidential election presumed to have been won by Bashorun MKO Abiola, and to return the military to the barracks.
Because the Federal Government has an inefficient tax recovery system, revenue accruals to the government is generally inadequate. The revenue shortage got even more acute when officials looked the other way when powerful individuals engage in oil bunkering, and divert government revenue into private pockets.
To pay for the imported petroleum products on behalf of the Federal Government, NNPCL pays from its reserve of hard currency. It must be from this “ghost” account that NNPCL pays its friends whom it gives licences to import refined petroleum products.
NNPCL then lied that it could not remit revenue earned on behalf of the federation to the Federal Accounts. This may be the source of foreign exchange that senior NNPCL officials give to their friends and bureau de change operators.
Having convinced the government of this lie, NNPCL then conducts its internal accounting, transferring revenue from its sale of crude petroleum account to that for payment for importation of petroleum products.
Incidentally, no internal or external auditor of NNPCL has been asked, or has offered to explain, how the recognition of liabilities or indebtedness and compensations within NNPCL is achieved.
Those NNPCL officers, the agents that they authorise to import refined petroleum products and their godfathers in government, may be the cabal that everyone is talking about. You just may not know.
No one has been able to ask how the prices of the imported petroleum products were negotiated. What should have been an open, scientific and verifiable process appears to be shrouded in some mystery.
Yet Dr. Mele Kyari, claims that the government owes NNPCL some N2.8tn, when imported petroleum products are paid for with crude petroleum.
