Kerosene: FG to stop subsidy, Reps probe alleged misuse of N634b
There are indications that the Federal Government will not subsidize kerosene in the coming year, even as the House of Representatives has directed its Committee on Petroleum Resources (Downstream) to probe the into the suspected misappropriation N634 billion set aside to subsidise kerosene in the last three years.
According to reports, there is no provision for subsidy on the product in the over N4 trillion to be proposed in the budget.
The House decision to probe the funds followed a motion by Adeyinka Ajayi, who alleged racketeering in the NNPC, stating that 'kerosene is purchased at the depot by dealers between N65 and N75 (against the supposed N40.90) per litre which in turn makes it commercially impossible to resell to Nigerians at the recommended retail price of N50.'
Adeyinka anchored his motion provided by his colleague and Chairman of the House Committee on Petroleum Resources (Downstream), Dakuku Peterside, who he said recently disclosed that the country spent N110 billion, N320 billion and N200 billion in 2010, 2011 and 2012 respectively, without providing corresponding palliatives for Nigerians.
The Peterside-led committee, which was given the mandate to carry out the investigation, and expected to submit its findings to the parliament within four weeks, is specifically tasked to beam its searchlight on the Nigerian National Petroleum Corporation (NNPC) and the Petroleum Products Pricing and Regulatory Agency (PPPRA) on the handling of the subsidy payments.
Also, the mandate of the House to the committee was to establish the source of money utilised to finance the payments and whether it was duly appropriated by the National Assembly, determine the companies benefiting from the payments, establish the extent to which the subsidised kerosene gets to the end users, as well as investigate all other incidental issues relating to kerosene supply and distribution.
Ajayi had, while making submissions on the motion, According to him, the product currently sells for between N130 and N150 per litre.
The lawmaker explained that there were conflicting reports between the Minister of Finance, Ngozi Okonjo-Iweala and the NNPC on the payment of subsidy on kerosene, pointing out that 'an investigation into these issues will promote transparency and accountability,' and ensure that the product gets to the Nigerian people at the recommended retail price.
Other members, including Fort Dike, Ahmed Baba Kaita and Raphael Igbokwe in their separate contributions, spoke in support of the motion, arguing that a lot of inconsistencies in the information provided by different stakeholders could only be addressed through the investigation.