Why fuel subsidy account is empty —Okonjo-Iweala

Minister of Finance, Dr. Ngozi Okonjo-Iweala
| credits: File copy

The Minister of Finance, Dr. Ngozi Okonjo-Iweala, on Tuesday confirmed The PUNCH’s story that the Federal Government’s subsidy account with the Central Bank of Nigeria was empty, blaming the situation on technical hitches in the documentation with the CBN.

Okonjo-Iweala, while briefing journalists in Abuja, said the transfer of funds meant for fuel subsidy payments from the excess crude dollar account to its naira equivalent accounted for the empty account.

She explained that the documentation and conversion process, which is between the Ministry of Finance and the CBN, usually takes between four to five days to accomplish.

She said if the amount had been in the naira excess crude account, the process of payment would not have been delayed for that long.

She said, “It doesn’t normally take very long if there was already money in the domestic excess crude account to honour it and this takes effect immediately.

“Sometimes we have to shift money from one account to the other and usually if the money is in the dollar account for the excess crude and we have to shift it to the naira account. That means, it will be converted into naira by the CBN and we have to authenticate the amount and so on.

“So between the Central Bank and the Ministry of Finance, it takes between four to five days to accomplish and the Central Bank is of course very strict because it has to have all the documentation, but I have been informed just before I came in that the money is being credited to the account now as we speak.”

She said “as soon as the account is credited on Tuesday”, marketers that had completed their paper work should go for their claims.

She said, “You know the conversion is being done and it is being credited to the account so marketers who have not been able to access their money should go today (Tuesday) and they will be paid.

“So it is not something that takes a long time, it normally takes less than a week to finish that procedure. The Accountant-General of the Federation is crediting the account now and they should go and check.”

Her explanation confirmed the exclusive story published in the Tuesday’s edition of The PUNCH that the Federal Government’s subsidy account was empty.

The PUNCH’s investigations had shown that oil marketers who went to the CBN on Monday were turned back on the grounds that the subsidy account with the bank had not been credited.

But the Minister said that the N161bn fuel subsidy supplementary budget had been released, and that of this amount, paper work for a total of N94bn to 23 oil marketers had been concluded.

She said, “We are appreciative for the approval by the National Assembly for the N161bn supplementary budget for fuel subsidy.

“This money was meant to take care of oil marketers and as of December 31 the Ministry of Finance had approval for this money to be made available in the central bank account where they can be accessed by the marketers once they have presented their papers and their Sovereign Debt Notes have been issued.

“So the money was made available as of December 31 and I understand that what is being done at this moment is that the money is being converted from dollars into naira and this process is being completed.”