• Senate panel threatens to compel Auditor-General’s appearance over absence from NEITI oil sector audit probe
Sunday Aborisade in Abuja
The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) on Thursday disclosed that Nigeria spent a staggering N1.16 trillion on fuel subsidy in 2021, while another N1.20 trillion was deducted from federation crude oil sales proceeds, as the Senate intensified its probe into the management of revenues in the nation’s oil and gas sector.
The revelation came during the presentation by the Chairman of RMAFC, Dr. Mohammed Bello Shehu, before the Senate Public Accounts Committee (SPAC), which is investigating findings contained in the 2021 to 2023 audit reports of the Nigeria Extractive Industries Transparency Initiative (NEITI).
Shehu told the committee that fuel subsidy constituted one of the largest deductions from oil revenues during the period under review, alongside several other cost items that significantly reduced distributable earnings to the Federation Account.
According to him, “Fuel subsidy alone accounted for N1.16 trillion in 2021, while N1.20 trillion was deducted from federation crude sales proceeds.”
He further broke down other deductions, saying, “Crude and product losses accounted for N16.20 billion, pipeline repairs amounted to N22.05 billion, while strategic stock holding cost N6.75 billion.”
The RMAFC chairman also faulted the methodology adopted in calculating the constitutionally guaranteed 13 per cent derivation fund for oil-producing states, arguing that the current practice defeats the intention of the constitutional provision.
He told lawmakers: “The practice of computing the 13 per cent derivation on the balance of revenue after deductions from the total collections is contrary to the intention of the derivation objective.”
According to him, deductions made before computing the derivation allocation substantially reduce the revenues accruing to oil-producing states, contrary to the spirit of the constitutional provision establishing the principle.
The disclosure formed part of a broader scrutiny by the Senate committee into revenue leakages, deductions from crude oil earnings, and compliance with financial accountability standards in the petroleum industry.
The committee also received submissions from the Niger Delta Development Commission (NDDC), but deferred consideration of the agency’s presentation until next week to allow members study the documents submitted.
Chairman of the committee, Senator Ibrahim Dankwambo (PDP, Gombe North), said lawmakers would reconvene on Wednesday for further engagement with the commission.
“We have decided to stand down the presentation by the NDDC to enable members study the report before the commission reappears next Wednesday,” Dankwambo said.
The hearing, however, took a dramatic turn when the committee expressed displeasure over the absence of the Auditor-General of the Federation from the investigative session.
Lawmakers described the absence as unacceptable, noting that neither the Auditor-General nor any representative appeared before the committee despite the importance of the ongoing investigation into the NEITI audit reports.
An angry Dankwambo warned that the committee would not tolerate further disregard for the authority of the National Assembly.
He declared, “The Auditor-General must unfailingly appear before this committee on Tuesday next week or risk invocation of the powers of the National Assembly against him, which will lead to forced appearance.”
The committee stressed that the Office of the Auditor-General occupies a strategic position in ensuring public sector accountability and transparency and therefore cannot afford to ignore legislative oversight.
The ongoing investigation by the Senate Public Accounts Committee focuses on audit findings by NEITI covering the 2021 to 2023 fiscal years, with particular attention on revenue remittances, deductions from crude oil earnings, subsidy payments, and compliance by agencies operating in the oil and gas sector.
The panel is expected to continue its hearings next week with appearances by the Auditor-General of the Federation, the NDDC and other key institutions connected with the management of petroleum revenues, as lawmakers seek explanations over alleged financial irregularities and deductions running into trillions of naira.