The Nigerian government has failed to pay oil marketers their subsidy claims for the 2013 fiscal year, executive secretary of the Petroleum Products Pricing Regulatory Agency, PPPRA, Mr Reginald Stanley said at a meeting with the Senate Committee on Petroleum Resources, Downstream.
The PPPRA boss traced the delay to the marketers’ inability to sort out foreign exchange claims at the Federal Ministry of Finance.
The federal government allocated N971.138 billion for fuel subsidy in the 2013 budget. A sum of N888.1 billion was officially allocated in 2012.
The fuel subsidy allocation, as captured on page xvii of the Approved 2013 Budget signed by President Goodluck Jonathan on February 26, indicates that the N971.133 billion is for “domestic fuel subsidy (marketers) (carry-over from 2011& 2012 provision for partial subsidy)”.
Stanley also noted that although the federal government has spent a total of N3.7 trillion in five years, the PPPRA has succeeded in cutting the number of oil marketers from 142 to 38 as at December 2012.
He added that local consumption of PMS has also been brought down from 60.25 million litres per day in 2011 to 40 million litres.
“Between 2006 and August 2011, total government expenditure on petroleum subsidy amounted to N3.7 trillion. Expenditure on subsidies increased from N261 billion in 2006 to N673 billion in 2010, which represents an increase of about 160 per cent,” Stanley disclosed.
“Additionally, there have been unprecedented payments in 2011 that so far amounted to N1.4 trillion due, in part, to two key factors: increase in subsidy per litre as a result of rising global oil price, and large arrears due NNPC for household kerosene imports.
“When we started, the chairman was very hard on us but he’s objective. I asked for time that we will live up to the Senate’s expectation and I’m happy with this visit.
“2011 was like a gold-rush where you had briefcase marketers. Local consumption rose to 60.25 million liters per day in 2011 but had dropped to 39.66 million liters per day in 2012.
Information from Leadership Newspaper was used in this report.