(From unconfirmed source)


Following the removal of subsidy on PMS on the 1
day of January, 2012
by the Federal Government of Nigeria and the attendant spontaneous
social and political upheavals that greeted the policy, the House of
Representatives in an Emergency Session on the 8
of January, 2012 set
up an Ad-hoc Committee to verify and determine the actual subsidy
requirements and monitor the implementation of the subsidy regime in
The Federal Government had informed the nation of its inability to
continue to pump endless amount of money into the seemingly
bottomless pit that was referred to as petroleum products subsidy. It
explained that the annual subsidy payment was huge, endless and
unsustainable. Nigerians were led to believe that the colossal payments
made were solely on PMS and HHK actually consumed by Nigerians.
Government ascribed the quoted figures to upsurge in international crude
price, high exchange rate, smuggling, increase in population and vehicles
etc. However, a large section of the population faulted the premise of the
Government subsidy figures, maintaining that unbridled corruption and an
inefficient and wasteful process accounted for a large part of the
payments. To avert a clear and present danger of descent into
lawlessness, the leadership of the House of Representatives took the 4
bold and decisive action of convening the first ever Emergency Session
on a Sunday (8
January, 2012), and set up the Ad-hoc Committee to
verify the actual subsidy requirements of the country.
The Committee decided that the scope of this investigation should be for
three years 2009 -2011 for the following reasons:
 The actual budget expenditure on subsidy for both PMS and HHK
was tolerable, being N261.1b in 2006, N278.8b in 2007 and
N346.7b in 2008. 5 companies including NNPC were involved in
2006, 10 in 2007 and 19 in 2008 contrasted to 140 in 2011.
 Secondly, in line with accounting practice, the Committee decided to
investigate three years activities of the scheme.
 The Committee could have chosen to limit the investigation to 2011
alone given the scale of escalation of subsidy in that year alone but
decided to take three years to establish a trend.


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We do we go from here? NEW
by: Anonymous

With the present bribery allegations and counter allegations? What do we make of the probe report?

Executive summary contd.

. On its part, NNPC was found not to be accountable to any body or
authority. The Corporation, in 2011, processed payment of N310.4
Billion as 2009 – 2011 arrears of subsidy on Kerosene, contrary to a
Presidential Directive which removed subsidy on Kerosene in 2009.
The Corporation also processed for itself, direct deduction of subsidy
payment from amounts it received from other operations such as joint
venture before paying the balance to the Federation Account, thereby
depleting the shares of States and Local Governments from the
distributable pool. Worse still, the direct deduction in 2011 alone, which
amounted to N847.942 Billion, was effected without any provision in
the Appropriation Act.7
5. While NNPC feasted on the Federation Account to bloat the subsidy
payable, some of the marketers were involved in claiming subsidy on
products not supplied. PPPRA laid this foundation by allocating
volumes of products each quarter to the marketers which it knew were
not in conformity with its own guidelines for participation.
6. Our investigation further revealed that certain marketers collected
subsidy of over N230.184 Billion on PMS volume of 3,262,960,225
litres that from the records made available to us were not supplied.
Apart from proliferation and non-designation of bank accounts for
subsidy payment, PPPRA and the OAGF were unable to manage in a
transparent manner the two accounts they chose to disclose. There
were indications that PPPRA paid N158 Billion to itself in 2009 and
N157 Billion in 2010. When confronted, the OAGF was unable to
submit details of the bulk payments arrogated to PPPRA and the
account from which the bulk sums were disbursed to the supposed

Executive summary contd.

The Ad-Hoc Committee held Public Hearings from 16
of January, 2012 to
of February, 2012, taking sworn testimonies from 130 witnesses,
receiving information from several volunteers, and receiving in evidence
over 3,000 volumes of documents.
In the course of the investigations the Ad-Hoc Committee was able to
establish the following:
1. Contrary to statutory requirements and other guidelines under the
Petroleum Support Fund (PSF) Scheme mandating agencies in the
industry to keep reliable information data base, there seemed to be a 5
deliberate understanding among the agencies not to do so. This lack of
record keeping contributed in no small measure to the decadence and
rots the Committee found in the administration of the PSF. This is
evident also in the budget preparatory process by MDAs where
adequate data is not made available to the National Assembly. The
Committee had to resort to forensic analysis and examination of varied
and external sources (including the Lloyds List Intelligence) to verify
simple transactions. In this regard, the PPPRA is strongly urged to
publish henceforth, the PSF accounts on quarterly basis to ensure
transparency and openness of the subsidy Scheme.
2. We found out that the subsidy regime, as operated between the period
under review (2009 and 2011), were fraught with endemic corruption
and entrenched inefficiency. Much of the amount claimed to have been
paid as subsidy was actually not for consumed PMS. Government
officials made nonsense of the PSF Guidelines due mainly to sleaze
and, in some other cases, incompetence. It is therefore apparent that
the insistence by top Government officials that the subsidy figures was
for products consumed was a clear attempt to mislead the Nigerian

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