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Finance Ministry Says Subsidy Payments Getting Out of Control

By on May 30, 2012

The Federal Ministry of Finance has stopped paying subsidy claims from oil marketers who have not been properly verified. This comes at a time when the Federal Government has disclosed that it has spent N 451 billion out of the 2012 N 888 billion subsidy budget servicing subsidy claims from last year.

According to a statement signed by the Senior Special Assistant to the Coordinating Minister for the Economy and Minister of Finance, Paul C. Nwabuikwu, “The Petroleum Products Pricing Regulatory Agency (PPPRA) and Nigerian National Petroleum Corporation (NNPC) claimed that N451 billion of the N888 billion subsidy budget for this year has already been spent on arrears for last year.

“ Since the NNPC/PPPRA’s estimate for the 2011 arrears was N232 billion, this means that more than double the projected amount has already been spent and those agencies are  still bringing in more claims. “

The statement said, “The Federal Ministry of Finance has a responsibility to ensure that subsidy payments are made in a prudent and transparent manner.”

It added, “The next meeting of the Federal Accounts Allocation Committee in June will provide the occasion for resumption of [subsidy] payments.”

The Finance ministry said “it is ready to work with relevant agencies for the common good of Nigerians, but will not be stampeded into making hasty payments on deliveries that have not been substantiated or verified.”

It said the rumors making the rounds of an impending fuel scarcity were baseless and simply attempts to steamroll the ministry into paying subsidy in a non-prudent manner.