Mega-Corruption and the Farouk Lawan Saga
Abuja, 14th June 2012
Following the release of the report of the House of Committee on the Fuel Subsidy, N-Katalyst, a non partisan network of individuals with a deep commitment to the promotion of Nigerian unity and progressive change organized a National Symposium in Abuja on 30 April 2012 to address the issues. We subsequently published a Charter of Demands drawing attention to significant findings on mega corruption in the fuel subsidy regime.
N-Katalyst believes that the recent revelations on the Farouk Lawan Saga must not push us into throwing away the baby with the bath water. Nigeria has a responsibility to ensure that the core recommendations emanating from the report are implemented. If there are suspicions that the Chair and some members of the Committee have been compromised into deleting some of the guilty companies, the same principles of investigating and punishing the guilty should be followed. As we understand the chronology, on 18th April when the report was presented, Otedola’s companies, Zenon and Synopsis were indicted. Subsequently, the following bribes were alleged to have been paid to Mr Lawan – April 21st $250,000, April 23rd $250,000 and early morning of April 24th $100,000. Later on the morning of April 24th during the House
Plenary Discussion on Subsidy Report, Zenon and Synopsis were delisted. Subsequently, Lawan had communications with the Chairman of the House Committee on Financial Crimes and the Inspector General of Police claiming Otedola is persisting in trying to offer him offer him bribes to influence the outcome of the investigation. Given the allegations, the Farouk Lawan saga should be investigated immediately and if evidence is found, those implicated should be prosecuted.
N-Katalyst believes that there is no democracy without a legitimate legislature that has integrity. Our Parliaments need to develop their capacity to carry out their legitimate functions. The military were always suspicious of the legitimacy of Parliament. In nearly fifty-two years of independence, we’ve had just over twenty-four years of Parliament. So, our Parliament still has some growth to do, it is therefore important to start a campaign on the ethics required of a legislator and we shall shortly publish our views on it. Meanwhile, we should remain focused on implementation of the report recommendations.
The Committee had reported that contrary to earlier figures from various official sources, subsidy payment of N2.59 trillion had been made as at 31st December, 2011, an amount more than 900 percent over the appropriated sum of N245 billion.” In addition, there are “outstanding claims by NNPC and the marketers in excess of N270 billion as subsidy payments for 2011.” The Committee, in its Report, established that “NNPC was found not to be accountable to anybody or authority”. Based on these findings, we made the following Demand.
1)Ending Impunity for the Fuel Subsidy Cabal
Mega corruption is destroying Nigeria and we must act to stop the rot:
i. All persons and institutions proven to have been indicted in the fuel subsidy scam should be punished. These include, but are not limited to, the Ministers of Petroleum Resources and Finance, the Board Members, MD and Management of NNPC, the Board Members and Executive Secretary of PPPRA, the Director of DPR and all public officials indicted in the Report by the House of Reps Ad hoc Committee.
ii. The freezing of the accounts and recovery of all illegal payments made to the Petroleum marketing firms, the NNPC, PPPRA and others which, according to the House Committee, amount to N1.2 trn or $6.8bn
iii. The immediate dismissal of the Minister of Petroleum Resources, Diezani Alison-Madueke to allow for effective investigation into the affairs of the Ministry.
2) Getting the Judiciary to do its Work
All levels of the judiciary are in crisis due to the appointment of successive Attorney Generals who see themselves as the President’s representative rather than an independent and impartial officer of the State determined to advance the cause of justice. We demand:
i. The immediate termination of the appointment of the Attorney General, Mohammed Adoke, SAN and appointing a credible Attorney General who has the skills and the will to combat and prosecute corruption.
ii. Announcing a time frame, not exceeding six months, for implementing the recommendations of the Farouk Lawan Committee report and commencing the prosecution of all indicted officials and all persons who benefitted, colluded or participated in the corruption scandal.
3) Restructuring of the Petroleum Sector
The structural conditions which allowed for the monumental fraud is that NNPC remains as the regulator, main producer and marketer of petroleum and its products, both upstream and downstream. It is a clear conflict of interest that allowed the organization to become a behemoth with no respect for laws and processes. We demand:
I. A Judicial Commission of Inquiry should be established into the operations of the Petroleum Ministry and NNPC.
ii. The management and the board of NNPC should be overhauled and those involved in any infractions should be investigated and prosecuted. The company should be unbundled to make it more transparent and efficient.
iii. NNPC through local refining, swap arrangements and offshore processing should be able to provide enough fuel for Nigeria. Therefore the government has no reason to grant subsidy import licenses to other companies.
4) Providing Fuel at Reasonable Prices
N-Katalyst accepts the Committee’s estimate that the probable daily consumption of Petrol from the record of marketers and NNPC comes to an average of 31.5 million litres. It, therefore, proposes the continuation of subsidy for Petrol and Kerosene and suggests a budget of N806.766 Billion for the 2012 fiscal year. The Committee asserted that the 445,000 bpd allocation to NNPC is sufficient to provide the Nation with its needs in petrol and kerosene, with proper management and efficiency.
i. Kerosene subsidy should resume as a means of helping the poor and aiding the struggle against deforestation in the search for fuel wood.
ii. Private investors who were issued licenses for the construction of new refineries must be made to use these licenses or the licenses be withdrawn and issued to serious investors who are ready to build new refineries over the next three years to guarantee sufficient local supply of petroleum products.
5) Citizen Engagement
N-Katalyst is aware that Government will not act if citizens do not mount sufficient pressure. We Nigerians must act more as citizens and not subjects. The country belongs to us all and we can no longer leave the political space to politicians, bureaucrats, common thieves and crooks. Nigerians must stand up and fight until we bring this monster under control.
i. Pressure should be mounted on Government to engage the participation of citizens in the formulation of a plan of action towards ending impunity and corruption in our national life, including the possibility of making corruption a capital offense.
ii. N-Katalyst commits to working with other civil society groups to ensure that these demands are met.
Dr Jibrin Ibrahim Dr Otive Igbuzor
Saudatu Mahdi Bilkisu Yusuf
Ayisha Osori Prof Ebere Onwudiwe
Yemi Candide-Johnson Ayo Obe
Saka Azimazi Maryam Uwais
Bashir Yusuf Ibrahim Innocent Chukwuma
Chris Kwaja Hassan Hussaini
Dr A. S. Mohammed Nsongurua Udombana
Asma’u Joda Nsirimovu Anyakwee
Dr Kabir az Zubair Martin Obono
Dr Hussaini Abdu Aisha Oyebode
Hubert Shaiyen Dr Arabo Ibrahim Bayo
Dr Ayesha Imam Dr Charmaine Pereira
Yusufu Pam John St. Claret Ezeani
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