Oshiomhole Hammers Okonjo-Iweala for Mismanaging the Economy

Says no transparency in management of ECA

In a scathing treatise a few days before the end of the Jonathan administration Governor Adams Oshiomhole of Edo State has accused the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala of gross mismanagement of the nation’s economy in the last four years and feeding Nigerians with half-truths.

According to the governor, in an article reviewing the nation’s economy in the last four years, he alleged Okonjo-Iweala ran the Excess Crude Account (ECA) as if she was running a oneman show, saying her recent outcry that oil marketers were falsifying subsidy claims might have been done out of fear of the incoming administration led by Major-General Muhammadu Buhari.

In the article, the governor said: “As the country transits from one democratic dispensation to another, there is no gainsaying that the state of the nation’s economy is the focal point, especially with the unending fuel scarcity which is gradually grinding the nation to a halt.

“No doubt, the best person to explain the state of the economy today is OkonjoIweala, the Honourable Minister of Finance and Coordinating Minister for the Economy, whose management of the nation’s resources in these past four years has elicited different reactions from Nigerians.

“As a member of the National Economic Council, I had spoken out at different times at NEC meetings and even in public on the way the economy is managed under Dr. OkonjoIweala. Again, I want to share my views with the public on some of the issues affecting the Nigerian nation.

“Recently, Okonjo-Iweala has been all over the place, pointing at the wrong directions and blaming everybody but herself for the parlous state of the Nigerian economy.

“Coming after her deafening silence on the PricewaterhouseCoopers (PwC) audit of NNPC’s crude oil sales and receipts, which revealed massive abuse of public trust and stealing of our common patrimony in high places under her watch and the government she serves, it is quite intriguing that with barely a few days left in office, she has suddenly woken up from her slumber to realise that oil marketers have been all along falsifying subsidy claims and defrauding the nation of billions of naira and dollars.”

He noted that this latter day “policy activism” on the part of the minister deserved closer scrutiny and interrogation.

He posited that perhaps for fear of the incoming president, come May 29, she was now being compelled to disclose to Nigerians that a cabal is holding the country and the government to ransom.

Besides the abuse of the subsidy regime, Oshiomhole urged Nigerians to insist that Okonjo-Iweala should come clean on some other critical issues that demand accountability from her and her office.

“According to Okonjo-Iweala, after paying N156 billion to the oil marketers, the marketers came with another claim of N200 billion, which includes a N159 billion coming not from actual supply of fuel but from exchange rate differentials. This resulted in prolonged bickering that led to the current nationwide fuel scarcity and total blackout.

“The question to ask is: how come that it is now, for the first time, that we are hearing from the Minister of Finance about fraudulent claims by the oil marketers amounting to billions of naira? At what point did the minister of finance and CME realise that these fraudulent and similar claims were going on? When did it start? Was it just recently or it has it been going on all along?

“These questions are pertinent because we know that if the Petroleum Products Pricing Regulatory Agency (PPPRA) was doing its work diligently, all claims by oil marketers would be vetted on a daily basis before their payments are processed by the Ministry of Finance. Hence, there should be no dispute about the amount due to oil marketers at any point in time.

“What the foregoing therefore suggests is that all along, PPPRA, the Ministry of Finance and the oil marketers have been involved in an unholy alliance, in the mismanagement of the fuel subsidy regime and in the process defrauding the nation of its revenues.

“The minister cannot stop at simply by shedding crocodile tears about fraudulent claims by oil marketers. Having found her voice, thanks to the fear of Gen. Buhari, it is very necessary that Dr. Ngozi Okonjo-Iweala takes one more crucial step at full disclosure.

“She must disclose to the nation the full details of subsidy payments made to oil marketers in the last four years, including the parameters used to calculate the subsidies. This also must include how much of the subsidy was paid to the NNPC since the NNPC is also being accused of making the same fraudulent claims.

“In other words, the minister should be prepared to provide more information and make more explanations regarding the management or mismanagement of subsidy payments in the last four years,” he said.

Oshiomhole then delved into the management or lack thereof of the ECA, adding: “This is another area in which the Minister of Finance should come out, shed more light and put all the cards on the table.

“During several meetings of the National Economic Council (NEC), which has all the governors as members and with the vice-president as chairman, I had cause to observe that the state governments, who are joint owners of the ECA, with the federal government, were not being adequately briefed on the status of the account.

“Accordingly, I had consistently demanded from the minister a transparent and periodic disclosure of accruals to the ECA, at least on a monthly basis. I had argued that even village associations do make available their financial statements from time to time, and as NEC, I see no reason why we will not even do better.

“All these years, my pleas fell on deaf ears. The Minister of Finance consistently failed to apprise the NEC with critical information on the management and operations of the ECA in black and white, when she eventually got to do that, it was usually verbal and casual, and hardly meaningful enough for decision-making.

“The minister had also developed the penchant for deliberately avoiding NEC’s crucial meetings, which many saw as a ploy to keep the governors in the dark. And when she was not around, no one got any information, as if she was running a one-man show.”

Delving into details, the Edo governor said: “It is interesting to note that by December 2012 the ECA had a balance of over $10 billion. This has been depleted to $2.07 billion by May 2015, according to the Finance Minister. Between January 2013 and May 2015, not more than $4 billion was shared from the ECA. Indeed, the last time any money was shared from the ECA was in May 2013.

“For six clear months in 2013, NEC did not meet, an act many believed was contrived to conceal information on the operations of the ECA. When eventually NEC met after those six months, the Minister of Finance reported that the ECA had dropped to $4 billion.

“This prompted me to ask a very pertinent question: if the closing balance of the ECA as at December 2012 was over $10 billion and that for three years running, Nigeria’s budget had been based on the average of between $77 and $79 oil benchmark while the average price of Nigeria’s crude has been $108 per barrel, suggesting an average of about $30 per barrel over the benchmark price, how come there was no accretion to the ECA?

“Indeed, based on a rough estimate, we should be expecting not less than $30 billion accretion based on the official oil exports of 2.3 million barrels per day. The question which Dr. Okonjo-Iweala should answer, therefore, is why did Nigeria not make any savings during the unprecedented boom years from 2011 to August 2014?

“The explanation offered by the Minister of Finance, which was as usual oral, and of course, far from satisfactory, was hinged on three factors, namely: (a) because of oil theft not much accrued to the ECA; (b) part of ECA was also used to fund petroleum subsidy and SURE-P; and (c) part of the ECA was also shared to the three tiers of government at the request of the state governments.

“Her claims in my view are untenable, fraudulent, illegal, unconstitutional and a clear breach of extant financial regulations.

“In the first place, the ECA is not the exclusive preserve of the federal government. It belongs to all the tiers of government: federal, state and local governments. Moreover, the minister has no power whatsoever to spend monies without the express consent and approval of the state governments.

“Until questions were asked as to the status of the ECA, no state government was put in the picture about the fact that money was taken from the ECA, why it was, and for what purpose.