The House of Representatives has stated that the response provided by the minister of finance and coordinating minister for the economy, Dr Ngozi Okonjo-Iweala, to the 50 questions posed to her on the state of the economy is unsatisfactory, because it failed to provide the information required by the lawmakers.
In a letter addressed to the minister entitled "RE: STATE OF THE ECONOMY: OBSERVATIONS, REQUEST FOR ADDITIONAL INFORMATION AND INVITATION TO INVESTIGATIVE HEARING", the committee led by Hon Abdulmumin Jibrin (APC, Kano) said after a detailed analysis of the response provided by the minister, it was discovered that some questions were ignored, misunderstood, partially answered or not answered at all.
In all, the lawmakers said 39 out of the 50 questions were not answered satisfactorily. A new request for answers to the 39 questions was forwarded to the minister to be replied not later than the 20th of this month along with an invitation to appear before the committee for a public hearing scheduled to hold from March 3 to 6.
The letter reads in part: "Your response to the 50 questions we raised to ascertain the true state of our economy dated January 15th, 2014 was received and carefully analysed by the committee.
"Having gone through your responses, the committee noted that some questions were either not answered, partially answered, outrightly ignored or completely misunderstood. The committee further noted glaring missing gaps in the responses, absence of supporting proofs to assertions and lack of relevant documents to back up the presentation as is the practice in any legislative oversight or investigation.
"Many data and statistics provided were inconsistent with subsequent information provided while answering other questions. Also noted were the wide-ranging comparison you made with other advanced and developing countries while responding to some questions but failed to apply the same in some cases that obviously require such approach. In some instances, you abruptly referred the Committee to relevant agencies for clarification. The committee is surprised at that because of its conviction that if all the questions raised are beyond the competence of the Minister of Finance, it is certainly not beyond the competence of the coordinating minister for the economy to the extent of information you must have in your possession, unless you say otherwise.
"In view of the above and ahead of the investigative hearing on the state of the economy, the committee is obliged to forward to you additional observations and requests to be submitted to the Committee not later than 20th February, 2014.
"The observations and requests are made on questions 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 20, 21, 22, 23, 24, 25, 26, 27, 30, 31, 32, 33, , 35, 36, 37, 39, 41, , 43, 44, 45, 47, and 48 while further details on the following questions will be taken at the hearing: questions 7, 18, 19, 21, 2, 8, 29, 34, 38, 40, 42, 44, 46, 49 and 50.
"Your responses this time and submission of the supporting documents are expected to put issues in clearer perspective to enable the committee conclude preparation for the hearing."
Highlights of the unsatisfactory answers
The committee asked: This time last year you informed this committee that our external reserve position was about $48 billion and the balance on our excess crude account was about $9 billion. You also said that the plan was to grow these balances to about $50 billion and$10 billion respectively. However we are hearing that the balances have dropped to $43 billion and $3 billion respectively. And you are saying all is well?
- On the issue of oil theft and pipelines vandalism, resulting in the loss of about 300,000-400,000 barrels per day, in 2013 alone, we have noticed how the figures keep changing and moving higher by the day in spite of ex-militants being paid by government to secure these oil installations and Amnesty Programme for ex-militants. With the above in mind can you justify the huge investment and appropriate use of these funds for the intended objective?
- By stating in her response, in explaining the reasons for the ECA and external reserve depletion, that "some funds were also used to augment FAAC allocations in 2013 while the CBN sold more foreign exchange in order to defend the Naira. Specifically, the total amount of foreign exchange that the CBN sold increased from $4.3 billion in the fourth quarter of 2012 to $10.80 billion in the third quarter of 2013", the Committee requests to know from which of the specific reserves does the CBN draw from, to strengthen the Naira. Why does the ECA keep dwindling month after month while the CBN reserve remained relatively stable at about an average of $35billion in 2013?
Crude oil projections for 2013 were 2.53 million barrels per day while actual figures as supplied by the NNPC/DPR/MTEF have averaged about 2.3 million barrels per day giving a shortfall of about 9%. Could this alone have caused such a drastic reduction in our reserves and savings positions?
- Committee will take a detailed response from the Honorable Minister at the hearing.
Is any money missing from our anticipated revenue from the NNPC in particular and oil industry in general? If there is, how much? If not, how come such issues emanate from high offices in the executive arm of Government?
- The Question was answered only partially. The Honorable Minister appeared to tie her answer to the question of money missing in the NNPC and oil industry in general, to just the one in the leaked letter from the Central Bank Governor. That however was not the tone of the question. The use of the word any refers to all funds unaccounted for before and after the one in the CBN Governor's leaked letter. The Minister is requested to respond accordingly, with supporting documents, and to cover other agencies in the oil industry.
- The NEITI Audit report concerning the NNPC and the NLNG earlier referred to may be instructive in this regard. See Committee's observation of the Minister's response to Question 32 and 33.
- As the Minister of Finance and the Coordinating Minister for the Economy, with longstanding experience in the topmost global financial institutions, are you concerned about the well-acknowledged lack of transparency in corporate governance in the foremost revenue-earning agency of the economy which you coordinate? Why is transparent corporate governance difficult to achieve in the NNPC?
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.
- The Honorable Minister only partially answered this question as asked. The committee required the names of persons/companies who benefited from these exemptions and waivers, within each of the sectors. The information is to include the specific goods imported, the amount or value of waivers/exemption granted each recipient on each round of import and the benefit(s) to the Nigerian Economy in each case. All corroborative supporting documents are to be submitted as well.
- What is the existing arrangement or schedule for monitoring the compliance and non-abuse of waivers/exemptions granted by government?