Tuesday, October 18, 2011

Revealed: Beneficiaries of oil subsidy

Revealed: Beneficiaries of oil subsidy

Who are beneficiaries of oil subsidy?
Their identity emerged yesterday as The Nation learnt that they comprise the five oil majors; members of Independent Petroleum Marketers Association of Nigeria (IPMAN)/Nigeria Independent Petroleum Company (NIPCO); depot and tank owners and those simply described as traders.

It was learnt that all the groups have been hiding under the guise of importing products to enjoy subsidy from the government. 
A top source in the Petroleum Products Pricing Regulatory Agency (PPPRA), who spoke in confidence, said: “Over the years, about four groups have been benefiting from the fuel subsidy. They are five oil majors in the downstream sector; members of IPMAN/NIPCO; owners of depots and tanks; and those we can call traders. 
“To avoid confusion in the oil sector, we cannot release the list of the beneficiaries unless the government decides otherwise. These players have boosted fuel supply in the country in the past through importation and they had mutual agreement with the government to enjoy subsidy.”
Deputy Senate President Ike Ekweremadu said on Sunday that Nigerians will be shocked if the list of subsidy beneficiaries is released.
The Federal Government which budgetted N240billion for fuel subsidy this year has spent more than N600 billion. It is believed that government would have spent N1.2 trillion by the end of the year. 
The government last week lobbied Senators and members of the House of Representatives to embrace the plan billed to commence from January. 
A government source said: “We have started a new process of engaging members of the National Assembly and the Labour to appreciate why the withdrawal of fuel subsidy is necessary. 
“As part of the new engagement, the Minister of Finance, Dr. Ngozi Okonjo-Iweala made a two-hour presentation to leaders of the National Assembly last Monday at the Presidential Villa. 
“A sensitization campaign has also begun in earnest. The gains from the withdrawal of fuel subsidy outweigh the fears being nursed by lawmakers and some highly-placed Nigerians.” 
A high-ranking Senator said: “The government is reaching out to us; they are lobbying us with facts and figures but we are not yet convinced that the withdrawal of fuel subsidy will not hurt our hard-earned democracy.”
Director General of NECA Mr Olusegun Oshinowo said the reported meeting between some private sector individuals, claiming to represent the OPS, and the Government on October 13 and 14 did not have the backing of the OPS.