NNPCL Reveals How Subsidy Retarded Infrastructure Development
The Nigerian National Petroleum Company Limited (NNPCL) on Thursday said that Nigerians have missed enormous infrastructure development due to the protracted fuel subsidy regime in the country.
The NNPCL disclosed that the amount spent on fuel subsidy payment could provide 7,500km of road network at N400 million per kilometre and 37 well-equipped 120 Beds Tertiary Health Centres at N32 billion per hospital annually.
Mr Lawal Musa, Senior Business Advisor to the GCEO, NNPCL disclosed this in Abuja at a joint National Association of Nigerian Students (NANS)/Civil Society Organisations (CSOs) sensitisation workshop on the NNPCL Operations.
Musa, in a presentation entitled “Petroleum Industry Act (PIA) and the Nigerian Economy’’ said the Federal Government spent as much as N4.8 trillion annually on fuel subsidy at the expense of the wellbeing of Nigerians.
In an analysis of the opportunity cost of the subsidy spending, he said deregulation could deliver 500,000 new houses and education and skill up of two million Nigerian students, among others.
He said it could deliver N12 trillion in four years to Nigeria while annual Premium Motor Spirit (PMS) under recovery would escalate to N3 trillion.
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He said the cost of fuel subsidy outweighed the direct benefits particularly to the masses.
He further said that deregulation could provide additional 27,000 megawatts of electricity to Nigerians and build and equip 2,400 hospitals in 774 LGAs.
“Nigeria is the largest producer of crude oil in Africa, possessing 28 per cent of Africa’s reserve, with petroleum contributing significantly to the country’s economy.
“The benefits derived have over the years been eroded due to the amount paid on subsidy, a regime has been fuelling the vicious circle of poverty in the country,’’ he said.
Musa explained that the PMS (fuel) was sold lowest price in Nigeria among most West African countries in spite of the average cost of $2.7 per litre globally, which amounted to up N570 per litre.
According to him, verifiable PMS demand data is critical to National planning and energy security.
In an overview of the PIA and New NNPCL structure, Mrs Oritsemeyiwa Eyesan, the Chief Strategy and Sustainability Officer, NNPCL, said the new entity was incorporated as a commercial company to be run like any other private company in the country, following the provision of the PIA 2021.
READ ALSO: Fuel Subsidy Now Above N400bn Monthly – NNPCL
Eyesan, represented by Mr Vincent Ogbu, her Business Advisor said NNPCL’s activities were guided by three core values namely integrity, excellence and sustainability.
She explained that the signing of PIA into law overhauled the institutional, regulatory and fiscal framework for the Nigerian petroleum industry and provided structured approach for managing host community development and investments.
She further said that significantly, the PIA mandated incorporation of old NNPC and established NNPCL as a fully commercial entity.
“Under the Act, NNPCL is to conduct affairs without recourse to government fund. The new NNPCL is being owned by 200 million Nigerians with Ministries of Finance and Petroleum Resources as major shareholders,” she said.
Earlier, the NNPCL Group Chief Communications Officer, Garbadeen Muhammad, said the NNPC was engaging with students as critical stakeholders in the new organisation which belonged to over 200 million Nigerians including the Nigerian students.
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Muhammad said the engagement which would be done annually, was aimed to enlighten the students and CSOs on the NNPCL as a new entity registered by the Corporate Affairs Commission under the Company and Allied Matters Act.
Also speaking, the National President of NANS, Usman Barambu, thanked the NNPC for the enlightenment workshop which had exposed the students on the new structure and operations of the oil company.
Barambu urged the company to ensure availability of fuel and tackle fuel scarcity in the country as well as opening of opportunities for ordinary Nigerian graduates to gain employment in the company.
Mr Olayemi Success, Chief Convener, Civil Society for Justice and Equity called for the removal of the fuel subsidy and urged government to channel the money towards improving the education sector.
NNPCL Withheld N8.48trn Oil Subsidy Since January 2022 – RMAFC
The Revenue Mobilization Allocation and Fiscal Commission (RMAFC) has accused the Nigeria National Petroleum Company Limited (NNPCL) of withholding N8.480trillion.
The commission said the NNPCL withheld the sum meant for the Federation Account, as petrol subsidy, from January 2022 till date.
A statement on Thursday by RMAFC Chairman, Mohammed Shehu suggested that the subsidy regime was shrouded in secrecy.
Shehu said the scrapping of oil subsidies by President Bola Tinubu, a decision he announced during his inauguration on May 29, was a good move.
“Since January 1, 2022, to date, the Nigeria National Petroleum Company Limited (NNPCL) has not been contributing to the Federation Account due to the claimed subsidy payments.
READ ALSO: Nigeria Earned N109.6trn Non-oil Tax In 12 Years – NBS
“The total amount withheld by the NNPCL as claimed subsidies for this period amounted to N8,480,204,553,608,” the statement reads.
The figure reported by the Office of the Accountant General of the Federation (OAGF) “is yet to be reconciled by the RMAFC, OAGF, and NNPCL”, Shehu noted.
The RMAFC chief said in a situation where subsidy transactions are not transparent, “it would be unwise to sustain the phantom payments of subsidy.”
He expressed optimism that the subsidy removal would eliminate uncertainty surrounding the subsidy regime and avail funds for the execution of critical national projects.
Shehu further charged the President to go after economic saboteurs “who have contributed to the nation’s economic woes.”
Nigeria Earned N109.6trn Non-oil Tax In 12 Years – NBS
The National Bureau of Statistics (NBS) has revealed Nigeria earned N109.6 trillion from non-oil taxes in 12 years.
The federal agency gave the breakdown in its latest report titled “Tax-To-GDP Ratio.”
The document noted that between 2010 and 2021, Africa’s most populous country earned N25.1 trillion from oil tax.
According to NBS, Nigeria collected N6.8 trillion in 2010, N9.4 trillion in 2011, and N8.4 trillion in 2012 as non-oil taxes.
Non-oil taxes earned the nation N9.2 trillion in 2014, N7.8 trillion in 2015, and N7.1 trillion in 2016.
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Furthermore, Nigeria generated N8.7 trillion in 2017, N10.6 trillion in 2018, and N12.5 trillion in 2019 from non-oil taxes.
However, the country collected N2.4 trillion from oil taxes in 2014, N1.4 trillion in 2015, and N1.2 trillion in 2016.
NBS added that the total tax revenue from non-oil taxes in the period under review was N142.4trillion
UK Clamps Down On Cryptocurrency Sector
Britain’s financial regulator on Thursday tightened rules over the promotion and selling of cryptocurrency as it seeks to protect consumers.
The Financial Conduct Authority unveiled a package of measures for the industry, which has long faced criticism over the lack of oversight — and promises of high returns in a volatile marketplace.
Under the new rules, companies promoting crypto products or services in Britain must from October give a “clear warning” that customers could lose money in “high-risk” investments.
READ ALSO: US Accuses World’s Largest Crypto Platform, Binance Of Illegal Operations
Marketing firms must also introduce a cooling-off period for first-time crypto investors.
FG put MDAs’ payments on hold
And the watchdog will also ban “refer a friend” bonuses that are designed to incentivise crypto investing.
“Our rules give people the time and the right risk warnings to make an informed choice,” said Sheldon Mills, head of consumers and competition at the FCA.
The announcement comes after Britain introduced legislation earlier this year to bring crypto promotions under the scope of the FCA.
READ ALSO: US Accuses World’s Largest Crypto Platform, Binance Of Illegal Operations
UK lawmakers are also demanding that crypto investments in Britain be regulated, in much the same way as the country’s gambling industry.
Reacting to the FCA announcement, the director of operations at industry group CryptoUK, Su Carpenter, said the new rules could prevent fresh entrants.
“There is a risk that this solution will both unfairly concentrate market power for those firms which are already authorised and potentially encourage unauthorised firms to operate from outside of the UK,” Carpenter said.
That could, in turn, create “a competitive disadvantage for UK-based organisations and also potentially undermining consumer safeguards”, she added in a statement.
The FCA clampdown follows moves toward tighter regulation in the United States.
READ ALSO: Bitcoin Slumps Below $23,000 In Crypto Crash
The Securities and Exchange Commission on Tuesday sued crypto platform Coinbase, charging that the largest US digital currency trading platform made billions of dollars by “unlawfully facilitating the buying and selling of crypto asset securities”.
The SEC has this week also unveiled charges against Coinbase peer Binance and its founder Changpeng Zhao for numerous alleged securities law violations.
The news follows the spectacular failure of crypto exchange giant FTX in November, stoking concern over a market dubbed by some critics as the “Wild West”.
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