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Subsidy: Nigeria Customs counters NNPC on ‘60m litres’ daily fuel consumption

The Nigeria Customs Service (NCS) says the Nigerian National Petroleum Company (NNPC) Limited was wrong in its claims that ‘60 million litres of petrol’ are being consumed daily in the country.

By TechnocratMedia

The Nigeria Customs Service (NCS) says the Nigerian National Petroleum Company (NNPC) Limited was wrong in its claims that ‘60 million litres of petrol’ are being consumed daily in the country.

Hammed Ali, NCS comptroller-general, said this on Thursday during a session with the house of representatives committee on finance on the 2023-2025 medium-term expenditure framework and fiscal strategy paper (MTEF/FSP).

The Customs boss wondered “why NNPC, which put Nigeria’s daily fuel consumption at 60 million litres, lifts 98 million litres into the market”.

When he was asked questions on the proposed subsidy spending for 2023, Mr Ali said the issue is about the daily petroleum consumption estimations.

“I remember that last year, we spoke about this. Unfortunately, this year, we are talking about subsidies again. The over N11 trillion we are going to take as debt, more than half of it is going for a subsidy,” Mr Ali said.

“The issue is not about the smuggling of petroleum products. I have always argued this with the NNPC. If we are consuming 60 million litres of PMS per day by their own computation, why would you allow the release of 98 million litres per day? If you know this is our consumption, why would you allow that release?

“Scientifically, you cannot tell me that if I fill my tank today, tomorrow, I will fill the same tank with the same quantity of fuel.

“If I am operating a fuel station today and I go to Minna depot, lift petrol and take it to Kaduna, I may get to Kaduna in the evening and offload that fuel. There is no way I would have sold off that petrol immediately to warrant another load.

“So, how did you get to 60 million litres per day? That is my question. The issue of smuggling, if you release 98 million litres in actual and 60 million litres are used, the balance should be 38 million litres. How many trucks will carry 38 million litres every day? Which road are they following and where are they carrying this thing to?”

The number Customs officer said NCS is doing its best to fight against smuggling, adding that more support, collaboration and provision will go a long way.

He also added that the service was not remitting its operating surplus of seven per cent because it is used for operations and payment of its staff members’ salaries.

“Nigeria Customs Service is the only organisation today that has to fight to collect revenue. It is the only organisation that losses its men in the course of collecting revenue and enforcing anti-smuggling provisions,” he added.

“It is the only organisation that raises its funds on a regular basis.

“As a result of this, the government agreed to give us a seven per cent cost of collection. By my understanding, the cost of collection is paying for our labour. That is what we live on, that is what we use to pay our salaries, and fund our capital and overhead. That is our sole income.

During the session, the committee members also queried him on the sums of N6.7 billion spent on legal matters out of N7.5 billion approved in the 2021 appropriation act, as well as the N9.2 billion proposed in the 2023 budget.

Mr Alli said NCS wrote the presidency for a virement of N4 billion to cater for pending legal debts.

He stated that inadequate funds may cause the service to pay as much as N20 billion for a suit of N3 billion for default.

The house of representatives had set up an ad-hoc committee to probe subsidy spending, yesterday began the move to unravel the scam behind the “60 million litres daily consumption” in Nigeria.

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