Despite Powers, N’Assembly Fails to Sanitise Oil Sector, Says Report

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 Accuses NNPC Board of being politically influenced

Chineme Okafor in Abuja

A new report called the 2017 Benchmarking Exercise Report (BER), published by the Nigeria Natural Resource Charter (NNRC), has disclosed that the National Assembly failed to use its constitutional powers to push for and sustain transparency in the oil industry.

The report, which was released last Thursday in Abuja, specifically indicated that legislative inefficiencies had made it extremely difficult for the legislators and their relevant committees to undertake far-reaching reforms that could clean up sleaze in Nigeria’s oil sector.

NNRC, which analyses the status of governance of the Nigerian oil and gas industry, is a policy institute established to promote the effective management of natural resources for public good using 12 precepts developed by the global Natural Resource Charter.

The Natural Resource Charter is a set of principles for governments and societies on how to best harness the opportunities created by extractive resources for development. It is not a recipe or blueprint for the policies and institutions countries must build, but instead provides the ingredients successful countries have used.

NNRC has as part of its experts’ panel, former minister of state for Petroleum Resources, Mr. Odein Ajumogobia, former chair of the National Stakeholders Working Group (NSWG) of the Nigeria Extractive Industries Transparency Initiative (NEITI), Prof. Asisi Asobie, and former director of the Department of Petroleum Resources (DPR), Mr. Osten Olorunsola, amongst others.

It explained that the National Assembly has over the years failed to consider and legislate on annual audit reports that concern the sector on its floors, thereby failing to give appropriate legislative guidance to the executive arm of government on governance issues in the sector.

The report, which faulted the level of independence of the board of the Nigerian National Petroleum Corporation (NNPC) in helping the state-run oil company operate optimally, also noted that oversight functions of the legislators on the industry have been impeded by the dearth of relevant and timely information relating to contracts awards, oil asset owned by government officials, and audit reports. These, it added, included audited financial records of agencies like the NNPC, which the Office of the Auditor General of the Federation (AuGF) should statutorily submit, but often did belatedly.

The NNRC report stated in parts: “Powers for legislative oversight are provided for in the 1999 constitution of the Federal Republic of Nigeria under sections 88, 89, 128 and 129 and include the conduct of investigations into governance issues through its committees and the monitoring of Ministries, Departments and Agencies (MDAs).

“Oversight of the petroleum sector is carried out by the committees on petroleum upstream and petroleum downstream in both the upper and lower houses of the National Assembly. Oversight functions of the National Assembly are impeded by a dearth of information and non-availability of key documents such as details of oil and gas contracts, audit reports, asset disclosure information of government officials and beneficial ownership information.”

“Inefficiencies in the National Assembly compound the problems and even when annual reports are received, they are seldom listed for plenary discussion not recommendations transmitted to the executive arm of government for implementation.

“In addition, investigations and sanctions by the National Assembly with regards to the petroleum industry appears to be weak. No punitive measures with far-reaching implications have been recorded,” it added.

The report cited examples to buttress its claims, saying, as at the time of its compilation, the 2016 annual audit reports that should be submitted to the legislators by the AuGF within 90 days from its receipt of statements from the Accountant General of the Federation had not been submitted while that of 2015 only got to the legislators on May 31, 2017, more than a year behind schedule.

The report equally mentioned the 2012 investigation of petrol subsidy payments to the NNPC and some public and private individuals, which the national assembly said were illegal. Besides, it pointed to claims made by a former Governor of the Central Bank of Nigeria (CBN) and now Emir of Kano, HRH Muhammadu Sanusi II, that up to $20 billion was missing from the federation’s coffers, as examples of cases that were yet to get conclusive legislative backings and pressure to punish the guilty parties.

The report noted that, it was worrisome that sums of monies and assets allegedly ill-gotten were traced to top officials in the NNPC and ministry of petroleum resources without Nigeria’s anti-corruption agencies knowing that such illegal flows were going on.

It thus suggested that agencies such as the Code of Conduct Bureau (CCB), Bureau of Public Procurement (BPP) and AuGF amongst others were not alive to their duties since the accountability and oversight mechanisms embedded in them could not detect the flows.

On NNPC’s board, the report explained that: “By design, the board and executive management are granted autonomous and independent powers to make decisions as it affects the running of the corporation. However, this is not the reflected in practice.”

“In most cases, incessant political interference limits the independence and effective functionality of the NNPC board and management. The appointment of the members of the board of directors and top management of the corporation is based on political patronage. The power to nominate and appoint granted to the Federal Executive Council are mostly abused, as shown in the high turnover of the GMDs – seven in three administrations, September 2007 till date,” it added.