Fuel Subsidy Monsters Unmasked; Time For Action

Last week, President Goodluck Jonathan and his economic team finally ran out of excuses for inaction on the massive swindle of Nigeria by some crooked fuel marketers and their bureaucratic enablers. A committee of the House of Representatives has done us all – Mr. Jonathan’s administration the most – the favor of unmasking the companies, agencies and individuals who had colluded to steal our collective resources through fraudulent fuel subsidy claims.

Last January, Mr. Jonathan had provoked one of the strongest moments of mass resistance in Nigeria’s history when his government callously removed all fuel subsidy. He and his economic team – especially the trio of Finance Minister Ngozi Okonjo-Iweala, Petroleum Minister Diezani Alison-Madueke, and Central Bank Governor Sanusi Lamido Sanusi – made claims that, taken together, were bizarre. Their first and primary claim was that the subsidy payments had risen to levels that the government could not sustain without jeopardizing investments in infrastructure and other critical areas of the economy. But when critics contended that the explosion in subsidy expenditure owed to fraudulent practices, the Jonathan squad argued, in effect, that the government did not have the means to identify, stop and punish the illicit profiteers.

Of course, for “means” some of us would substitute “political will.” The truth is that the big players (bureaucrats, politicians and corporate elements) who hijack Nigeria’s subsidy funds were – and are – well known to Jonathan as well as the Okonjo-Iwealas, the Diezanis and Sanusis. Often, the biggest criminals in Nigeria can be found dipping soiled hands in the same plate as the highest of the country’s political authorities. Nobody is deceived when the Nigerian government professes ignorance about the identity and location of the country’s thieving First Eleven. Look in the mirror!

To read portions of the report released by the eight-member House committee headed by Farouk Lawan is to realize how utterly morally bankrupt Nigeria has become. In a country where more than seventy percent are mired in desperate levels of poverty, the report unveils how a handful of officials at government agencies and robbers robed as businessmen gorged on N2 trillion!

Mr. Lawan’s committee accused the NNPC and PPPRA, government agencies involved in administering or regulating the oil sector, of deliberately choosing not to keep “reliable information data base.” In its executive summary, the committee highlighted “endemic corruption,” “entrenched inefficiency,” “sleaze,” and “incompetence.”

And, yes, the report was clear that the Nigerian people were right to rise against the Jonathan administration’s precipitate removal of fuel subsidy in January. “It is therefore apparent,” wrote the committee, “that the insistent by top Government officials that the subsidy figures was for products consumed was a clear attempt to mislead the Nigerian people.” The choir of misleaders was conducted by Ms. Okonjo-Iweala, with Mr. Sanusi and Ms. Alison-Madueke as accompanying soloists.

Nigerians were scandalized by the Jonathan administration’s figure of N1.3 trillion as subsidy payments for last year. The House committee’s report paints an even direr portrait of the scandal. It disclosed, first, that there were discrepancies in figures submitted by different government agencies. Nigeria’s accountant general gave a figure of N1.6 trillion; the Central Bank calculated N1.7 trillion. By contrast, the Lawan committee found that the payments exceeded N2.5 trillion as at December, 2011. The committee’s figure represents an increase of more than 900 percent over the originally budgeted sum of N245 billion!

Nigeria is one of the few places in the world where there would be a scandal of this scale, and the government still sits pretty, its officials insulting the intelligence of its people by serving them ill-written, cliché-ridden speeches as a substitute for real leadership.

Any sentient Nigerian can tell you that the Nigerian National Petroleum Corporation is an eloquent synonym for corruption. The Lawan committee has given us added proof. It said the NNPC was not “accountable to anybody or authority.” In 2011, the corporation unilaterally processed payments for N310 billion as arrears of subsidy on kerosene – even though a presidential directive had removed the subsidy in 2009. The committee also accused the corporation of helping itself a hefty N847 billion in subsidy payment, thereby lowering revenue shares accruing to the state and local government tiers.

The Lawan committee put it squarely: the “NNPC feasted on the Federation Account to bloat the subsidy payable.” In other words, the NNPC operates as a sovereign body above the Nigerian people and their president! Which officials of the agency took these decisions? Which political heavyweights provided cover for these criminal acts? Who benefited from the cache of misrouted cash? As some NNPC officials did what they know best – siphoning funds – “some of the marketers were involved in claiming subsidy for products not supplied.” The committee unearthed evidence that hundreds of billions of naira were handed to marketers for fuel that was never supplied. In other words, government officials and the marketers colluded in huge 419 schemes and pocketed our cash in broad daylight!

The picture is one of egregious sleaze at numerous levels. In one typical instance, in 2009, Nigeria’s accountant general authorized the payment of equal installments of N999 million for a record 128 times within twenty-four hours in January, 2009! The payments – made to beneficiaries that the committee could not ascertain – amounted to approximately N128 billion.

A crime like the foregoing is so blatant that one is tempted to advocate mob justice. I mean, consider that pickpockets caught stealing N10 at Oshodi or any other market in Nigeria are routinely garlanded with car tires, doused with fuel and set ablaze. Imagine, then, what Nigerians would do to those thieftains who perpetrate trillion naira heists.

Nigeria has a well-founded reputation as the cemetery of scandals. In the early days of the Umaru Yar’Adua administration, a House committee investigating Nigeria’s electric power woes dug up evidence that former President Olusegun Obasanjo had handed billions of dollars to phony contractors, local and foreign. That report was buried in controversy, and the chairman of its committee, Ndudi Elumelu, was himself accused of participating in corrupt schemes in the power sector.

Make no mistake, if Nigerians fail to insist on accountability on the subsidy probe, the system will ensure that the scandal has another day or two in the sun – and then exit into a state of anonymity. Nigeria is designed to shield big, daring and well-placed criminals from any form of discomfort, much less serious criminal prosecution. And there’s no question that those who pocketed two trillion naira last year in the name of fuel subsidy are some of Nigeria’s most connected, men and women who hold high political office or dine with the highest of them. Far from being blind, Nigerian law (like those who enforce) always has an eye open – and can tell the riff raff from the “chieftain” and “critical stakeholder.” The former can be thrown in jail without the pretense of a trial; the former is, quite simply, above the law.

But the system will remain so rigged only if enlightened Nigerians elect to do nothing. Beginning now, the labor unions and professional associations should threaten to go on a nation-wide strike until the fuel subsidy profiteers are arrested, booked and tried. They should de

mand the immediate resignation of government officials whose ministries, departments or agencies are implicated by the Lawan committee.

Now that Lawan and co. have unmasked the buccaneers who stole “subsidy funds,” the trio (Okonjo-Iweala, Alison-Madueke and Sanusi) who headlined the government’s case for punishing wretched Nigerians for the sins of the profiteers now have a clear challenge. They must lend their voices to the cause of compelling the fraudsters to pay back. Then they ought to endorse the prosecution of those, officials and business operatives alike, who impoverished the rest through mindless inflation of subsidy claims.

Ms. Alison-Madueke, under whose watch most of the hanky-panky occurred, ought to resign – or be fired. There’s no question that she, as the minister of petroleum, must be held accountable for the regulatory lapses that enabled unconscionable parasites to steal close to two trillion naira from the Nigerian people.

Written by
Okey Ndibe
Join the discussion

  • The house should also look into 8 years of Obasanjo’s government. During Obasanjo’s first and second terms in government, there were many corrupt practices in the oil sector (NNPC) and sadly, Obasanjo was the president as well as the minister of petroleum in those 8 years. The probe must look back into the era of Obasanjo before the probe could be seen as complete. The current probe in NNPC without looking into Obasanjo’s 8 years as president and oil minister amounts to a calculated attempt to free the crime leader while punishing the smaller thieves.

  • The labor unions and professional associations should not “threaten” to go on strike; they should immediately go on strike until first, fuel prices return to N65 per liter, and then the rest of your recipe can follow…resignations and incarcerations of erring people.

    Good follow-up on the crisis.