FG still pays bridg­ing claims de­spite sub­sidy re­moval

Daily Trust - - BUSINESS - By Daniel Adugbo

The fed­eral gov­ern­ment is still in­cur­ring huge bills to bridge petrol de­spite re­mov­ing sub­sidy on the prod­uct, find­ings have shown.

Bridg­ing claims, a ma­jor com­po­nent in the dis­tri­bu­tion mar­gins, are paid as re­im­burse­ment to mar­keters for losses in­curred as a re­sult of sale of petroleum prod­ucts at uni­form prices na­tion­wide.

Gov­ern­ment had last month jerked up fuel price stat­ing that any Nige­rian firm could now im­port the prod­uct and sell at the price band of be­tween N135 and N145.

Ex­pec­ta­tions were that gov­ern­ment had stopped pay­ment of ev­ery com­po­nent in the sub­sidy scheme but the Petroleum Equal­iza­tion Fund Management Board (PEF MB), the agency re­spon­si­ble for dis­burs­ing bridg­ing claims to mar­keters said bridg­ing claims are still be­ing paid so that prod­ucts could be moved to other parts of the coun­try es­pe­cially fur­ther North.

Spokesman for the agency Mr. Goddy Nnadi said as long as bridg­ing is still within the Petroleum Pric­ing Reg­u­la­tory Au­thor­ity (PPPRA) pric­ing tem­plate, gov­ern­ment will still be pay­ing mar­keters.

He added that as long as prod­ucts are still be­ing moved by road, the cost in­curred by mar­keters to bridge prod­ucts from de­pots to filling sta­tions would still have to be borne by gov­ern­ment.

“Of course it has to be paid; there are var­i­ous modes of trans­porta­tion of prod­ucts if we have good in­land water­ways some of them would have been moved by barges which were the orig­i­nal plan,” he said.

The Na­tional Trea­surer of the In­de­pen­dent Petroleum Mar­keters As­so­ci­a­tion of Nige­ria (IPMAN), Bar­ris­ter Dibu Aderibigbe, said that as much as gov­ern­ment wants uni­form price through­out Nige­ria, the claims will still have to be paid.

“But if price can be var­ied from state to state then the role of PEF will be wa­tered down,” he said.

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