The Nation Newspaper

Tag: Okonjo-Iweala

  • Lost and found!

    Lost and found!

    If Nigerians ever needed iron-clad evidence of outlawry of their national oil corporation, weekend’s response by the General Manager, Media Relations, Group Public Affairs Department, NNPC, Omar Farouk to the firestorm over the alleged missing $10.8billion may have finally supplied one.

    Not that anyone ever doubted the farce that rules the nation’s finance system as a whole; or the plague of officials helping themselves to the national till that has long become norm. However, the latest revelation of the laissez faire conduct, the outrageously out-of-control practices by a corporation that is supposed to be a creation of statute –with active connivance of top officials of the finance ministry – may have set new limits in outlawry.

    Let’s start from the very beginning.

    Late last year, Governor, Central Bank of Nigeria, Lamido Sanusi, had alleged that the corporation failed to remit $49.8bn to the Federation Account for the period spanning 18 months – that is, between January 2012 and July 2013. The problem, as it later turned out was that the figures declared missing had failed to take into account the $39 billion paid by the Federal Inland Revenue Service, FIRS, and the Department of Petroleum Resources, DPR, into the federation account.

    I had said on this page that, coming from the nation’s top banker, the ‘omission’ was inexcusable, if not entirely irresponsible. Since then, the officials of the finance and petroleum ministries – including the NNPC, have made valiant attempts to pass off the charge as fiction even when there was still $10.8 billion unaccounted for.

    Apparently, the corporation’s weekend tale of the missing money was meant to be the final demolition job on the charge by the CBN governor. While I do understand that some so-called defence do not so qualify; the suggestion that the missing money has been spent on behalf of the federal government, is not only worse than no defence at all, it borders on the treasonable!

    Let’s look at the three-part component of how the money went as told by the NNPC’s spokesman.

    The first part, he claims represents “the expenses on some of the responsibilities, which the corporation carries out on behalf of the Federal Government with respect to domestic crude oil utilisation. One of such issues is the unpaid subsidies on kerosene and Premium Motor Spirit”.

    Here, if Nigerians are any familiar with the billions allegedly paid to the scores of ghost importers of petrol and kerosene, the tale about the value being deducted at the source from NNPC’s piggy bank on behalf of the federal government has been told so severally to the point of being wearisome. Considering that the same subsidy is also said to be charged on the excess crude account, Nigerians must wonder at what is going on.

    The same applies to the 32 days’ stock of premium motor spirit at 40 million litres of national consumption per day. Isn’t that supposed to be one-off budget? Of course, while the reserve accounting looks easy and simple and straightforward to determine upfront, NNPC and its allies in government obviously think that they require something outside the cycle of the budget to defray.

    And the third – you guessed right: the cost “of pipeline vandalism, oil theft and other security issues”.

    Again, that is supposed to be indeterminate – the kind that requires the rule of thumb to determine.

    And the three, we are told is what makes up the yet-to-be-reconciled balance of $10.8bn”!

    Should anyone be surprised at the creative account that seeks to work backwards to the answer? To be candid, the shock would have been if the reconciliation team came up with anything new?

    To begin with, for a corporation that has long acquired the image of a lawless entity, the self-indicting revelation that the quantum of national obligations – reckoned in billions of dollars – could be financed outside of the framework of appropriations can only pass on the altar of the ingrained culture of criminal impunity. Before now, the arguments about the deductibles from the federation account had always centred on the shady operational costs borne by the NNPC in the course of its activities. Quite familiar also is the creative accounting in which all manners of expenses gets passed off to the federation account.

    Now, the revelation that the corporation has a licence to do as it pleased with the federation account has finally been declared as legit!

    So, no money is missing? Only when one accepts that the beneficiaries of the accruals into the federation account actually get the amount due to them can one suggest otherwise.

    Now to the specifics: Did Finance Minister Okonjo-Iweala actually claim last year that she had not paid any subsidy on kerosene since she assumed office? At what point was it therefore charged to the NNPC account? Is a case of looking for expenses to charge to the missing money?

    The latter obviously raises the question of who authorised the payment from the NNPC accounts. Petroleum Minister Diezani Alison-Madueke? Or the NNPC board which she chairs? Does the board – if it exists – have such powers? Is it the Federal Executive Council? Could they have done so without the authority of the National Assembly?

    While Nigerians may not have bothered about the laws of the republic being broken by officials sworn to uphold the law, I guess it’s time to worry about the parallel government described as the NNPC; a quasi-government without the strictures of parliament; an entity only answerable to a conclave.

    Still want to know where the money went? Certainly, it’s not in the books. Try as the reconciliation team might, the job goes beyond reconciliation. That itself assumes that the reconcilers have the nerves to do the job. Soon enough, Nigerians would see evidence in the cities and the country-sides when our Abuja overlords unleash their war-chest for 2015. That time, it would be headache for Sanusi as it would be for everyone of us all.

    Again, it is happy New Year!

     

  • Okonjo-Iweala shuns House deadline

    Okonjo-Iweala shuns House deadline

    Is the economy healthy? There seems to be no answer to this knotty question, with Minister of Finance Ngozi Okonjo-Iweala’s seeming refusal to clear the air.

    The House of Representatives Finance Committee gave the minister 50 questions on the state of the economy. She was to answer in two weeks. The Minister was yet to respond yesterday.

    The Committee, on December 19, last year listed the 50 questions for the Minister at an interactive session where she told the lawmakers that she was “sick due to lack of sleep”.

    The meeting ended on a sour note when the Minister insisted that she could continue with the session, with the assistance of her two subordinates.

    The Committee refused to grant Mrs. Okonjo-Iweala’s request, saying her health could not be compromised.

    Committee Chairman Jibrin Abdulmumin said the backlash could only be imagined if she collapses during the session.

    Though the Chairman could not be reached for comments, it was learnt that the Committee is not opposed to giving the minister more time for her response.

    A source told The Nation: “You see, the minister almost succeeded in making us look like we were inconsiderate whereas we were not aware of the reaction that would follow if we insisted on questioning a sick minister.

    “I am sure the Committee will give her enough time; we won’t leave any room for anyone to put the blame on us by the time we wield the big stick. Nobody is bigger than the country.

    “We are not here on our own and we are constitutionally empowered to do what we are doing. The issue is about the country and not about an individual and this is not a party matter.

    “My guess is by the time we resume from the break, more than enough time would have been given and by then, whatever we decide to do would not be seen as vindictive.”

    The Committee’s concern on the economy is premised on the fact that the government has been celebrating a single-digit Gross domestic Product (GDP) growth, but facts do not support the claims.

    The Committee noted that while speaking recently at a breakfast dialogue with some members of the organised private sector in Lagos – a forum organised by the Nigerian Economic Summit Group (NESG), the Minister was quoted as saying: “We are growing, but not creating enough jobs. That is a very big challenge…We need to grow faster. I think it needs to grow at least 9 to 10 per cent to drive job growth the way we want.”

    The Committee asked: “Don’t you agree that a good finance minister managing an economy like ours should be celebrating a GDP growth as high as 20 per cent annually?

    “Why is it that our economy cannot grow beyond a single digit? How many jobs are being created as a result of these said growths? In which sectors of the economy are these jobs created? If in private sector, what contribution is government making to further assist these private sector firms?

    “In the presence of Nigeria’s huge infrastructure deficit, why is it that the country’s debt-to-GDP at about 19 percent in 2012 remains one of the lowest in the world when compared to nations already with world-class infrastructure and industrial economies, such as America’s 105 per cent, Brazil’s 65.49 per cent, India’s 67.60 per cent and South Africa’s 40.9 per cent?

    “Since facts don’t lie, have you any disagreements with the September 4, 2013 Global Competitiveness Report of the World Economic Forum for 2013-2014, which ranked Nigeria 120th out of 148 countries ranked in the Global Competitiveness Index, including being ranked far behind some African countries, such as Mauritius 45th, South Africa 53rd, and Kenya 96th?

    ‘’For the first time in Nigeria’s 53-year history, we have successfully privatised the electric power industry,’’ so said the President at a recent meeting in London with some foreign investors.

    “As minister of finance, should you agree that the recent privatisation of the country’s power infrastructure is worth celebrating as a major economic achievement in 2013, when in reality there is little or nothing to show as an improvement in the country power supply? Also, why our rush to wholesale privatisation of the power sector when countries like South Africa, generating as high as 42,000MW, still have their power sector mostly in public hands?”

    The Committee was also cognisant of the fact that Nigerian leaders are always quick to compare the nation’s economic growth or otherwise with other countries.

    However, the Committee was of the opinion that while it was easy to compare, but economic indices in the two environments were conveniently ignored by the leaders.

    Looking at the essence of the Excess Crude Account and the Sovereign Wealth Fund to internal economic growth, It was pointed out to the minister that “Your references to the country’s economic growth profile have always been based on Fitch, Standard and Poor’s, and Moody’s ratings.

    “Are you aware that these same rating agencies are being sued in New York (with case # 652410/2013) by two Bear Stearns hedge funds for fraudulently assigning inflated ratings to securities in the run-up to the 2008 financial crisis? If you do, why do you insist on accepting the rating as reliable.

    “How much exactly has been the amount of money lost in government revenue as a result of import duty waivers in 2011, 2012 and 2013? Provide the names and beneficiaries and justification for same.

    “In your opinion as the minister of finance who oversees the economy, what are the implications to the country’s economy? What efforts have you made to stop this waiver policy, which is distorting the economy?

    “Our non oil income has dropped in 2013. A case where increased tariffs on various items effectively reduced importation to zero in some sectors. However, those items now find their way into Nigeria through our borders.

    “Does it make any sense to increase these tariffs when we have such porous borders? As an example, officially, Togo imported more rice this year than Nigeria.

    “Do you really believe that Nigeria needs a ‘Sovereign Wealth Fund’ at this critical juncture of budgetary deficits, and having to be borrowing extensively in an effort to address government revenue gaps?

    “Shouldn’t the presence of Nigerian Sovereign Investment Authority (NSIA) simply mean spreading government’s scarce resources thinly? Why will you insist that no matter what, we still need to operate a sovereign wealth fund?

    “Sincerely speaking, how sustainable are the objectives of Nigeria’s Sovereign Wealth Fund, particularly in the long-term? You should agree that a lot of Nigerians are interested in the link between NSIA and the government.

    “Since there is no doubt that Nigerian Sovereign Investment Authority is an agent of government — or is it not? The question is: How should we think about the management structure in so far as major decisions are concerned?

    “Where is the line between NSIA, as a commercially minded entity, and the government, especially given government’s policy of having no business doing business? If, for example, government does not get involved in specific investments, then, who appoints the external managers involved in managing some parts of the NSIA funds?

    “Who determines the investment objective and who establishes the risk parameter for the NSIA’s portfolio? In providing answer to this question, it is also important to understand and explain why NSIA recently hired a Swiss national as its chief portfolio investor?

    “Answering this question is important since it should help us to know who determines the maximum draw-down that the government would be comfortable with in extremely negative market environments.

    “Do you agree that the Excess Crude Account (ECA) as being operated by government is illegal and unconstitutional, especially given how it has been managed?

    “Can you explain with clarity how the ECA is being operated? Also, provide a statement of account of the ECA from 2011 to 2013? Also, how much have we made in excess of the benchmark price from January 2013 till date?

    “If there is nothing like Excess Crude Account, would you have been demanding lower oil price benchmark for the budget, especially when the executive arm of government around the world is known for demanding more money from lawmakers in order to be able to meet government spending obligations, particularly capital spending?

    “Why is the reverse the case in Nigeria only, notably since 2011? With respect to the Excess crude account and our Sovereign Wealth Fund again, there have been allegations and counter allegations on its legality.

    “Assuming, for the sake of the committee’s enlightenment, the FGN alone saved its own excess in its ECA/SWF (which is about 52% of the Federation Account) and the states and local governments get their funds in full compliance with the constitution, what would be the effect on the economy?”

  • Cry my beloved country

    Cry my beloved country

    Events of the past couple of weeks in the polity tend to suggest that our dear country Nigeria is closer to the brink than initially thought.

    You all have read by now the infamous open letter of former president Olusegun Obasanjo to his god son and Nigeria’s incumbent president Goodluck Ebele Jonathan on his perception of the state of our nation.

    You must have read or heard also of a secret letter (leaked to the public) to the president by the Governor of the Central Bank of Nigeria, Sanusi Lamido Sanusi alleging that a whooping 49 billion USD or thereabout of earnings from oil, our major source of revenue, has not been properly accounted for by the Nigerian National Petroleum Corporation, NNPC. I don’t want to use the word missing to describe the state of the money as some were inclined to do. You know Sanusi has somehow recanted after a tug of war on figures so to speak with Finance Minister Okonjo-Iweala that the figure is somewhere closer to 10 billion USD.

    The two letters, both on the state of the nation have eventually drawn President Jonathan to his laptop to finally, or is it belatedly, pen a response and give us his own version of the state of our union. All the letters are in public domain, you are at liberty to chose which one to believe.

    In the midst of all these letter writings and dancing naked in the public by our leaders, I had cause to pass through one of our airports and while awaiting my flight to Lagos a certain Asian gentleman, I think he is Indian, was lamenting the state of affairs in this country, saying he has been here since 1983 and has never seen a country go down so quickly the way Nigeria is sliding currently. He wished we could as a nation and people do something urgently to arrest the situation.

    He was not even talking of the political situation (may be he was only being careful as a foreigner), he was worried about what he saw around him right there at the airport, the nonchalance of airline/airport workers to the plight of passengers that were left stranded for hours without explanation by the airlines; the deteriorating state of the airport, poor facilities even after billions of public funds have allegedly been spent to improve; the bare faced corruption going on there, and etc.

    The way he was saying all those things you’ll know he was saying them to effect, passing a message across, perhaps just using the airport situation as a metaphor for the larger problem out there.

    As he spoke my mind went to the Obasanjo letter especially what he said on the state of corruption in Nigeria, the alleged training of snippers by the administration to kill some one thousand or so Nigerians on the Federal Governent watch list, the vindictiveness of the Jonathan presidency against real or perceived enemies, the government’s romance with criminals and a whole lot of allegations contained therein.

    If a foreigner could talk like this, I guessed he must have seen something we as Nigerians are not seeing or chose to ignore.

    After several hours of delay the aircraft finally arrived and we headed back to Lagos safely. But that Indian never left my mind even when I wanted to push him away. And just as I was succeeding in doing this the president’s letter came; his response to Obasanjo. Personally I wasn’t impressed and no apology for that. His supporters can say whatever they want to. I’ll come back to that later.

    I am not a fan of Obasanjo because he is not better than Jonathan. But what I found surprising in his letter was that all those bad things we complained about under Obasanjo are still happening even with Jonathan. Have we not learnt anything? What kind of a nation is this?

    Obasanjo complained about corruption all around Jonathan and GEJ apologists say his mouth is smelling. Yes his mouth might be smelling, but then let’s cover our nose and listen with our ears. Is corruption not at it’s peak now? And what is Jonathan doing about it?

    In his laughable response he wanted Obasanjo to show him one example of corruption in high places and see what he would do about it. Do you need an Obasanjo to tell you that what is happening in the aviation sector, especially the role of the seemingly untouchable Minister of Aviation Stella Oduah in the BMW bullet-proof car scandal is enough evidence of corruption or attempt to defraud the state? Recall that the Honourable Speaker of the House of Representatives Aminu Tambuwal did say something similar about corruption incorporated in the Villa and the President’s seemingly supportive body language? All Jonathan could say is that he is fighting corruption, but we have not seen the evidence yet, let him start with Stella Oduah, then we’ll know he is in business.

    The damage the ruling Peoples Democratic Party, PDP is doing to the polity with its on going civil war is incalculable and Jonathan as party leader appears incapable of doing anything to stop it. All he could say was to blame Obasanjo and a few others for orchestrating it. Our democracy is in crisis because PDP is in disarray. If there is no crack in the wall of PDP how can an Obasanjo’s lizard enter it? When people say Jonathan is weak, he lacks initiative, this is one of the things that are talking about. How can you open your eyes and allow a behemoth that the PDP had become to collapse on your head, knowing the implication for the country, and all you could do is to blame another person for it? Us this how to be a leader?

    I don’t want to believe Obasanjo’s pepper soup theory of government training a squad of snippers to assassinate government’s opponent, but as a former President and Commander-in-Chief may be he knows what he was talking about. May be we better listen to him. And all Jonathan needs to do to prove Obasanjo wrong is to ensure that no assassination, whether political or otherwise took place under his watch, and if it did take place, the perpetrators are swiftly brought to book. Sadly Obasanjo couldn’t say this for his eight years presidency.

    But in an atmosphere of insecurity, anything could happen, thus Obasanjo’s alarm on the deteriorating security situation in the country, especially in the north east zone should not be brushed aside. Yes the Jonathan government is doing its best to contain if not destroy the Boko Haram insurgency, but the rate of setbacks in recent months suggests either a lowering of guards by the security agencies or an insurgency smarter and better organised than our military. This is not the time to pontificate or lay blame, we should all rally round Jonathan to bring down Boko Haram and restore peace to the north east. The government should also not arrogate to itself the power of knowing it all. If a former Commander-in -Chief is talking about security, please listen to him, even if his mouth is smelling.

    Jonathan talks about the improving state of the economy and the increase in Foreign Direct Investment (FDI) flow into the country in contrast to the dire picture painted in Obanjo’s letter. I don’t know what the president was talking about. Economic growth without jobs? The president and his coordinating Minister of the Economy Okonjo-Iweala can be deceiving themselves thinking that all is well; Nigerians are no fools!

    There are so many issues raised in Obasanjo’s letter and the President’s tame response that space will not allow a thorough analysis, but one issue stands out; the President’s personal integrity and credibility. Obasanjo alleged that Jonathan is not a man of his words; sadly, he is not the first person to so allege. Most people around the corridor of power in Abuja will tell you the same thing. You can’t go to the bank with Jonathan’s words. There is even this joke that there are five presidencies in Jonathan presidency and of the five his own is the weakest.

    This could be uncharitable if you ask me, but at the same time most unfortunate if it is true. This is the public perception and the President must do something about it. After all perception they say is close to reality. If Nigerians believe their president is weak and not a man of his words then he can do no good in their eyes no matter how hard he tried.

    People point at his wife as one centre of power; his Chief of Staff, Ministers of Petroleum and Aviation as the other presidencies, and the President has not called them to other even for one day in the face of public complaint against them.

    The President may not see it as so, but these people together with his rabid Minister of Education Nyesom Wike and some of his Ijaw kinsmen are the ones giving him a bad name among Nigerians not Obasanjo. He should leave the former President alone; tackle his message and not the man. After all Iyabo Obasanjo is enough to tackle her father. May God not give us a daughter like Iyabo. Did I hear you say and a father like Olusegun Obasanjo? Na you sabi. I don talk my own.

  • Okonjo-Iweala to present 2014 budget Thursday

    Okonjo-Iweala to present 2014 budget Thursday

    The Minister of Finance, Dr. Ngozi Okonjo-Iweala will on Thursday present the 2014 Budget to the joint session of the National Assembly.

    She will perform the task on behalf of President Goodluck Jonathan who is unavailable for undisclosed reasons.

    The presentation of the 2014 budget had been postponed twice due to disagreement between the Senate and the House of Representatives over crude oil benchmark.

    Both chambers had posted different figures on the oil benchmark.

     

     

  • Okonjo-Iweala denies alleged N500b missing SURE-P funds

    Okonjo-Iweala denies alleged N500b missing SURE-P funds

    The Minister of Finance and Coordinating Minister for the Economy, Mrs Ngozi Okonjo-Iweala yesterday denied the allegation of N500billion Subsidy Reinvestment and Empowerment Programme (SURE-P) funds is missing.

    Mrs Okonjo-Iweala spoke at an interactive session with the Senate Ad-Hoc Committee on SURE-P in Abuja.

    She said there was no substance in the allegation.

    The Minister challenged the Committee to invite all Ministries, Departments and Agencies (MDAs) that are stakeholders in the administration of SURE-P funds to a joint meeting, where the discrepancies would be sorted out.

    Mrs Okonjo-Iweala said: “As far as I am aware, there is no SURE-P money missing. The difference in the amount that comes to the Federal Government goes to the state and local government accounts.”

    The Minister, however, did not give details of the number of litres of fuel consumed monthly and how the amount due to the Federal Government has remained N15billion monthly despite fluctuating oil revenue.

    Mrs Okonjo-Iweala said that it is only the committee on SURE-P that can provide details about that since her Ministry was only directly responsible for the graduate internship programme.

    She said: “I was directly responsible for the graduate internship Programme. That is our direct role within the SURE-P. Amount accrued to the Federal Government is published each month. For me, the focus is on graduate internship programme, which is under the Ministry of Finance.

    “It was the desire of Nigerians that SURE-P be run separately. This is the reason a committee was set up to oversight the fund and administer it. As a Minister of Finance, my role is minimal.

    “It is sad that despite the efforts of Mr. President to ensure transparency and erase suspicion in the minds of Nigerians by creating SURE P committee, I am made to account for missing money.”

    She acknowledged that N816billion accrued to SURE-P from January 2012 to December 2013.

    Out of the amount, she explained that the Federal Government got N300billion while the balance N516 billion was shared by the states and local governments.

  • Customs revenue drops to N304b, says Okonjo-Iweala

    Customs revenue drops to N304b, says Okonjo-Iweala

    • Excess Crude Account stands at $3.3b

    Revenues from Customs have declined to N304.6 billion as a result of the Federal Government’s fiscal incentives, the Minister of Finance and Coordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, has said.

    Speaking yesterday in Lagos at a breakfast meeting with the Organised Private Sector (OPS) on the performance of the economy and projection for 2014, she said the figure which is for the third quarter, represents a 14 per cent decline from the N356.01 billion recorded for same period in 2012.

    Mrs. Okonjo-Iwaela said Federal Government’s revenues in 2014 are estimated at N3.58 trillion, indicating a 13 per cent decline from the 2013 budget estimates. She said the expenditure in 2014 is projected at N4.5 trillion, repreenting a 9.9 per cent decline from the 2013 figure .

    She said addressing revenue shortfalls in 2014 would require eliminating inefficiencies in government expenditure through fighting corruption in the public service, reducing the cost of governance and rationalisation of agencies in line with recommendations of the Orosanye Report, among other processes.

    She said systems such as the Integrated Payroll and Personnel Information System (IPPIS) which enhances efficient personnel cost planning have been put in place to curb wasteful spending.

    The Minister said 260 Ministries, Departments and Agencies are on IPPIS as at June 2013, adding that work is on-going to bring in other 321 MDAs not yet on IPPIS.

    She said government savings on payroll cost to date, is N139.6 billion and that about 46,821 ghost workers have been identified through the introduction of the Government Integrated Financial Management and Information System (GIFMIS) in April 2012.

    She said the GIFMIS is aimed at improving the acquisition, allocation, utilisation and conservation of public financial resources using automated and integrated, effective, efficient and economic information systems, adding that 58 per cent of the budget is now executed through GIFMIS and that the figure would rise to 79 per cent by end of 2013

    On the economy, she said: “Growth continues to be driven by the non-oil sector. Inflation has gone down in 2013. Inflation was 7.8 per cent at the end of October, showing a continual downward trend for the 10th consecutive month, down from 12.3 per cent in December 2012.”

    She said the Excess Crude Account (ECA) stood at $3.3 billion as at November and may even decline further, adding that Foreign Reserves now stand at $44.7 billion. She 1.6 million jobs were created in the past 12 months.

  • I’m not your problem, Okonjo-Iweala tells Amaechi

    I’m not your problem, Okonjo-Iweala tells Amaechi

    Minister of Finance Ngozi Okonjo-Iweala has told Rivers State Governor Rotimi Amaechi to look in the mirror, if he wants to identify the source of his problems.

    Responding to the claims that she is responsible for the delay in the approval of the state’s water project by the African Development Bank, the minister yesterday fired back at the governor, saying that “it is sad that a governor can engage in this kind of undignified charade.

    “The question that fair minded people must ask is Amaechi the only governor the ministry deals with? Why is he the only one negatively obsessed with Okonjo-Iweala?

    “The ministry has a good relationship with many governors and deals with issues concerning their states based on professionalism and equity.”

    The governor’s statement that she is responsible for the delay of the water project “is a complete fabrication.”

    “As the ministry had previously explained, the project is going through the processes and must get final approval from the ADB board and the Federal Executive Council before I can sign it. So the idea that I have refused to sign it is preposterous and inaccurate.”

  • Court declares tax tribunal illegal

    Court declares tax tribunal illegal

    A Federal High Court in Abuja has ordered the Minister of Finance, Dr. Ngozi Okonjo- Iweala to disband the Tax Appeal Tribunals established by the Federal Inland Revenue Service (FIRS) to adjudicate on matters relating to federal taxes and related revenues.

    The order is contained in a judgment by Justice Adeniyi Ademola, which declared the tax tribunal illegals. The judgment was on an appeal filed by a firm, TSKJ Construces Internacionals Unipessoal LDA.

    The judge held that the eight Tax Appeal Tribunals set up by FIRS were established in contravention of section 251 (1) (a) and (b) of the Constitution.

    TSKJ, a non-resident tax payer, was awarded a contract by the Federal Government for the construction of the Nigeria Liquefied Natural Gas (LNG).

    In executing the contract, the company set a local subsidiary – TSKJ Nigeria – which rendered logistic support service to it in the course of the contract.

    At the conclusion of the contract, TSKJ filed self assessment forms on deemed profits, on the basis that its profit could not be ascertained.

    The company made deductions on charges being the cost paid to its local subsidiary.

    FIRS disallowed the deductions made by TSKJ on the ground that the deductions were not allowed under the turnover basis assessment.

    FIRS consequently issued the company additional assessment on the ground that the deductions earlier made by the company were wrong.

    TSKJ objected to the additional deductions and filed an appeal at the Tax Appeal Tribunal, asking that the additional assessment be set aside.

     

     

     

  • Fed Govt saves N120b from ghost workers in MDAs

    Fed Govt saves N120b from ghost workers in MDAs

    The Federal Government has said it saved N120 billion from ghost workers in its Ministries, Departments and Agencies (MDAs).

    Dr Ngozi Okonjo-Iweala, the Coordinating Minister for the Economy and Minister of Finance, spoke in Lagos at the FBN Capital third annual investors’ conference.

    The minister said the figure was N20 billion higher than the N100 billion the government discovered in February.

    She said the government would continue to cover the leakages in the economy to reduce recurrent expenditure and promote the development of infrastructure.

    “The major problem that distorted current expenditure in the country was the across-the-board increase in salary in 2010,” Okonjo-Iweala said.

    The minister, who spoke on the theme: 2014 and Beyond: Managing Growth Prospects and Challenges, promised that the Federal Government would further reduce its recurrent expenditure in the 2014 budget.

    She said the government would continue with its fiscal consolidation to increase job creation and provide social amenities.

    Okonjo-Iweala said the nation’s gross domestic product (GDP) would be rebased to reflect the growth recorded by various sectors of the economy.

    She said the GDP growth of 10 per cent would remain government’s target in the years ahead.

    Olusegun Aganga, the Minister of Trade and Investment, said the Federal Government would maintain investor-friendly reforms to encourage Foreign Direct Investment (FDI) inflows.

    Aganga, who spoke on the theme: FDI Flows-Enhancing Nigeria’s Positioning and Competitiveness, stressed that the government would ensure the growth of all sectors to reduce dependence on petroleum.

    The minister said the government would concentrate on areas with competitive and comparative advantage to sustain growth, especially in agriculture development.

    He said Nigeria, with its rapid growth and potentials, would be among the world’s best 30 performing economies by 2050.

    The News Agency of Nigeria (NAN) reports that the conference, tagged: Tomorrow’s Nigeria Through Economic Empowerment, is a yearly event of FBN Capital Limited.

     

  • Rivers got N56.2bn from Excess Crude Account, says Finance Ministry

    The federal ministry of finance has described as false allegations by Governor Rotimi Amaechi of Rivers States that $5 billion is missing from the Excess Crude Account (ECA).
    A statement from the ministry said “Governor Amaechi cannot credibly deny knowledge of the status of the ECA. He has been closely involved and actively participated in making requests to the Presidency for the ECA to be shared for the purpose of augmenting the regular allocations from the Federation Account whenever there is a shortfall.”
    The federal ministry of finance noted that the $5 billion in the ECA which Governor Amaechi referred to “has been shared to the three tiers of government to make up for the revenue shortfalls during the Federation Accounts Allocation Committee process.”
    Part of this fund the ministry said “also went for SURE-P payments and the balance for subsidy payments to oil marketers.”
    To buttress its argument, the office of the Coordinating Minister for the Economy and Minister of Finance Mrs. Ngozi  Okonjo-Iweala  released the statement attached a table showing that Rivers State received N56.2 billion, the second highest share among the states, for January to September 2013 from the Excess Crude Account.
    This amount the ministry added “includes N43 billion for shortfalls plus N12 billion released for SURE-P.”
    Okonjo-Iweala and her team added that “earlier this month (November 2013) Rivers State along with other states, benefitted from the sharing of $1 billion from the ECA to augment the allocations.”
    It then described as curious claims by Governor Amaechi denying knowledge of the whereabouts of the N56.2 billion which Rivers State has received from the ECA this year.
    With regards to claims that Okonjo-Iweala has refused to sign the African Development Bank (ADB) loan for a water project in Port Harcourt,the ministry denied the allegation as wrong.
    The loan in question the ministry said “has been appraised but it is yet to be negotiated. Before the minister can sign it, it has to go through the negotiation process and be considered and cleared by both the Board of the African Development Bank and the Federal Executive Council. So the issue of the minister refusing to sign it simply does not arise.”