BREAKING NEWS
Breaking

728x90

468x60

FG fuel subsidy account is currently empty

Three weeks after the National Assembly approved a N161.6bn supplementary budget for  payment of fuel subsidy for 2012, the subsidy account with the Central Bank of Nigeria has yet to be backed by cash by the Minister of Finance, Dr Ngozi Okonjo-Iweala.

The PUNCH’s investigations showed that oil marketers, who went to the CBN on Monday, were turned back on the grounds that the subsidy account with the bank had not been credited.

Our correspondent learnt that the oil marketers had been issued Sovereign Debt Notes from the Debt Management Office following the passage of the N161.6bn supplementary bill by the National Assembly.

The Federal Government normally issues oil marketers with SDNs as  security against any delay in payment of subsidy for imported cargoes.

SDN, which is another name for government borrowing, is like Treasury Bills and can be discounted for cash, though while the former is a short-term borrowing, the latter is for long term.

The issuance of the SDNs by the DMO, it was learnt, was to allow the CBN quickly fund the marketers’ accounts with their respective Deposit Money Banks.
A top official in one of the oil marketing companies confirmed to our correspondent during a telephone interview that they were turned back by the CBN.

The source, who pleaded not to be named as he was not officially permitted to speak on the issue, said accounts of  all oil marketers who had been issued with DMBs could not be credited because the subsidy account with the CBN was empty.

He said, “There might be another round of scarcity because most of us are still being owed by the Federal Government.

“This is because the subsidy account in the CBN has not been credited. When the supplementary budget was passed, the Ministry of Finance said they are going to pay us so they asked the DMO to issue us with SDNs. This is a note that would enable the CBN to credit our accounts with commercial banks.

“We took it to the CBN but we were surprised at what happened. They told us that the subsidy account has not been credited because the N161bn has not been converted to cash by the ministry of finance.

“It is the Minister of Finance that usually tells the Accountant General of the Federation to fund the account; but as I speak to you, this has not been done. So we are still being owed.”
When contacted on the issue, the Director, Corporate Communications Department of the CBN, Mr Ugochukwu Okoroafor, said the issue of fuel subsidy payment was the role of the Ministry of Finance and not that of the bank.

He said, “It is not our responsibility. Our own job is that of a banker and customer relationship and that confidentiality must be respected. Let them (marketers) check with the Ministry of Finance.”
Efforts to get the Special Assistant, Communications, to Okonjo-Iweala, Mr. Paul Nwabuikwu, were not successful as he did not pick calls sent to his phone.

A text message sent to his mobile phone had also not been acknowledged as of the time of filing this report.
President Goodluck Jonathan had on December 11 sent a request to the National Assembly to approve an additional N161.6bn to ensure steady supply of petroleum products during the festive season.

The development had reportedly brought a relief to oil marketers who had not been able to import petroleum products owing to the huge debt burden from the Federal Government.
Scarcity of petrol had started with the Yuletide, but assurances by the authorities had raised hopes of a quick solution.

But despite the assurances, there were fuel queues in many parts of the country, a development the Petroleum Products Marketing Company blamed on panic buying by Nigerians as well as the fire outbreak at Ijeododo, Lagos.

The company had attributed the scarcity in Lagos area to the fire outbreak, while it said the one in Abuja was a result of normal panic buying during festivities.

(PUNCH)
Click to signup for FREE news updates, latest information and hottest gists everyday


Advertise on NigerianEye.com to reach thousands of our daily users
« PREV
NEXT »

1 comment

Kindly drop a comment below.
(Comments are moderated. Clean comments will be approved immediately)

Advert Enquires - Reach out to us at NigerianEye@gmail.com