Don't Miss

Fuel marketers groan under unpaid subsidy claims

By BusinessNews Staff on July 4, 2014

Barely three months after the Federal Ministry of Finance paid N41, 074,772,210.95 to 27 Oil Marketing (OM &T) companies whose subsidy claims had successfully gone through the verification processes, the marketers are groaning under unpaid claims, THISDAY’s investigation has revealed.

This is coming as the Federal Ministry of Finance has disclosed that the process for the payment of N45 billion is currently ongoing, with the Office of the Accountant-General of the Federation (OAGF) confirming that some marketers, who have submitted letters of indemnity to the OAGF have already been paid.

THISDAY gathered that the unpaid claims had made it increasingly difficult for the marketers to access credit from the banks to fund importation of products.
One of the marketers, who spoke to THISDAY, said there were more than 10 batches of claims at various stages of verification at the Ministry of Finance, and the Petroleum Products Pricing and Regulatory Agency (PPPRA) since November 2013.

He disclosed that payment for five batches- R/13, S13, T13, Q13 and V/13, representing Premium Motor Spirit (PMS) imported and discharged in 2013 are still outstanding.

According to him, these unpaid claims amounted to over N160billion.
The marketer also stated that another six batches of unpaid claims – A/14, B/14, C/14, D/14, E/14 and F/14 for products imported between January and April 2014 are also at various stages of verification process.

He noted that these outstanding claims for January to April amounted to over N100billion.

He said the total of unpaid bills, which amounted to over N200billion were at both the Ministry of Finance and the PPPRA for processing and verification.
A source at the PPPRA, however, told THISDAY that the agency had verified all import claims forwarded to it and pushed them to the ministry of finance for payment.

“We do not have backlog of claims in PPPRA. All import documents forwarded to us have been verified and pushed to the ministry for payment,” he said.
But in a swift response, the Special Adviser to the Coordinating Minister for the Economy and Minister of Finance, Mr. Paul Nwabuikwu, said last night that only marketers whose claims had been cleared after they had gone through the verification processes are paid.

According to him, this is to ensure that the unpleasant experiences of the recent past with regard to wrong and irregular payments are not repeated.

“The process for the latest batch of payments totalling N45 billion is currently on and the Office of the Accountant-General of the Federation (OAGF) has confirmed that some marketers who have submitted letters of indemnity to the OAGF have already been paid. Other claims are being attended to,” he said.

Nwabuikwu further stated that the letters of indemnity are an additional requirement for payment because banks, which financed imports by some marketers had written to the OAGF through their lawyers to complain that their clients (the marketers) are making interest payments through other banks contrary to the terms of agreements reached.

“The banks in question are insisting that the interest payments be made through them since they granted the facilities that attracted the interest. To ensure that the federal government is not held liable in the event of any litigation between these banks and their marketer-customers, the OAGF has instituted the new procedure,” he added.

He noted that subsidy payments are made retroactively because claims must go through all the necessary processes before they are approved and paid.
According to him, government will continue to discharge its obligations to marketers whose claims are approved.

[This Day]

headline