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Economy

FG may merge NIWA with NPA, stop funding recurrent expenditure of MAN, ORON in a public service reform

 

—–as FG ready to implement Orosanye  report
The Eyewitness reporter
In a major civil service restructuring exercise that is expected to be implemented in 2023, the federal government may merge the functions and duties of the National Inland Waterways Authority (NIWA) with the Nigerian Ports Authority (NPA).
Similarly, the government will stop funding the recurrent expenditures of the Maritime Academy of Nigeria (MAN), ORON, but still retains the funding for capital projects of the school.
The reform is part of the recommendations of the Orosanye report on the merger and scrapping of some federal Ministries, Departments and Agencies of government (MDAs).
In 2011, Stephen Oronsaye submitted a report to downsize the federal service commission and eliminate the duplication of duties by the 541 Fed Govt parastatals, commissions, Ministries, Departments and Agencies (MDAs).
According to the report, Nigeria stands to save over N300bn if  Federal Government should implement the white of Orosanye report which recommended the scrapping or merger of 400 out of the 541 MDAs next year.
Our reporter gathered from the report that the functions and duties of NIWA would be subsumed under the NPA to cost costs.
The committee said that there is a duplication of some of the duties and functions of the two agencies which should be undertaken by the NPA.
It could be recalled that the core duties of NIWA include overseeing the waterways transportation and dredging some of the channels of the waterways for safe navigation of water crafts, which overlap with the functions of the NPA.
On the activities of MAN, ORON, the committee suggested that the government should stop funding the recurrent expenditures of the school like staff salaries which the report suggested could be funded by the school through the fees and other levies placed on students.
The government will, however, continue to fund the significant capital projects in the school for enhanced efficiency.
Before becoming the Head of the Civil Service, Orosanye had a rich stint in the private sector and brought his experience of judiciously managing resources to bear on the Civil Service.
 Members of the committee included: Japh CT Nwosu; Rabiu D. Abubakar, Salman Mann; Hamza A. Tahir; Adetunji Adesunkanmi; and Umar Mohammed.

Recommendations were made for 263 of the statutory agencies to collapse into 161, a merger of 52 agencies, and the outright expungement of 38 redundant agencies while returning 14 as sub-units In ministries.

And in 2014, a white paper was issued by Fed Govt to act upon the report.
From all indications, the Buhari government is poised to implement the white paper issued in 2014 on the report.
The following statutory and non-statutory agencies are up for merger or out-and-out expulsion.
 Their previous budgetary allocations gleaned from open-source materials suggests what could be saved when the NASS completes the repealing of some of the agencies.
The CBN, NNPC and many other agencies won’t be getting budgetary allocations in 2023.
Merge the Nigerian Communications Commission, National Broadcasting Commission, and Nigerian Postal Service into one single commission called the Communications Regulatory Authority of Nigeria.
The National Examinations Council (NECO) goes under the roof of the West African Examination Council (WAEC).
A merger of  The Federal Radio Corporation of Nigeria, Voice of Nigeria and the Nigerian Television Authority to form the Federal Broadcasting Corporation of Nigeria.
Scrap the Federal Road Safety Corps while putting the agency under the Highways Department of the Federal Ministry of Works, and their staffers should be sent to the Police Service Commission and Vehicle Inspection Office.
Economic and Financial Crimes Commission( EFCC), the Independent Corrupt Practices and Other Related Offences Commission( ICPC) and the Code of Conduct Bureau become a single entity.
The Federal Airports Authority of Nigeria became privatised.
National Inland Waterways goes under the roof of the Nigerian Ports Authority. The report says to abolish the National Rural Electrification Agency.
Pull the plug on 23 research institutes and fund them through the National Research and Development Fund and research grants.
The National Directorate of Employment and the Small and Medium Enterprises Development Agency of Nigeria merge to become the National Agency for Job Creation and Empowerment.
Privatise Nigerian Communication Satellite.
Hajj and Christian Pilgrims Commissions funding from Govt should discontinue. Merge Administrative Staff College of Nigeria and the Public Service Institute of Nigeria.
Repeal the law establishing the National Salaries and Wages Commission and transfer its functions to the Revenue Mobilisation and Fiscal Responsibility Commission.
The Infrastructure Concession Regulatory Commission goes under the Bureau of Public Enterprise.
The Border Communities Development Agency is to be absorbed by the National Boundary Commission.
Cut recurrent expenditure funding of the National Institute for Policy and Strategic Studies while maintaining the capital expenditure.
Merge the National Emergency Management Agency and the National Commission for Refugees.
The Nigerian Institute of Social and Economic Research is to be funded by a proposed National Research Development Fund.
The National Agency for the Control of AIDS goes under the roof of the Nigeria Centre for Disease Control.
Privatise The Nigerian Communication Satellite.
National Board for Technical Education and the National Commission for Colleges of Education to morph into the Tertiary Education Commission.
Quit approving concurrent expenditure for the National Open University of Nigeria.
The Nomadic Education Commission and Mass Literacy Council go under the wing of the Universal Basic Education Commission.

The Federal Ministry of Environment and the Department of Petroleum Resources take over the National Oil Spill Detection and Response Agency.

The Ministry of Environment assumes the functions of the National Environmental Standards and Regulations Enforcement Agency.
Scrap the Institute for Peace and Conflict Resolution and transfer its functions to the Department of Strategic Studies at the Nigerian Institute of International Affairs.
Cut the Directorate of Technical Cooperation in Africa.
Federal Ministry of Trade and Investment to take over the functions of the Nigerian Copyright Commission (NCC) after repealing the law establishing NCC.
Scrap the National Productivity Centre.
Abolish the National Steel Raw Materials Exploration Agency and transfer its functions to the Nigerian Geological Survey Agency.
Scrap National Metallurgical Development Centre, Jos, and Metallurgical Training Institute, Onitsha.
Merge the Petroleum Products Pricing Regulatory Agency and the Petroleum Equalisation Fund.
 The Nigerian Content Development and Monitoring Board to accommodate the Petroleum Technology Development Fund.
Scrap the Federal Ministry of Police Affairs and saddle its functions with the Ministry of Special Duties.
Merger the National Council of Arts and Culture with the National Troupe of Nigeria and the National Theatre.
Scrap The National Power Training Institute of Nigeria.
Discard The National Centre for Technology Management.
A proposed National Commission for Museums to be formed from the merger between the National Commission for Museums and Monuments with the National Gallery of Arts.

Abolish The Nigeria Institute for Hospitality and Tourism Development Studies, and its functions were taken over by the Nigerian Tourism Development Corporation.
Shut Down all 774 field offices of the National Orientation Agency and give the duties to the Public Communications Department in the Ministry of Information and Culture.
Close down the duplicating National Institute for Cultural Orientation.
Nigerian Import-Export Promotion Commission would be formed after merging the Nigerian Export Promotion Council and the Nigerian Investment Promotion Commission.
Discard the National Centre for Automotive Design and Development Council.
Do away with the Oil and Gas Free Zones Authority while transferring its functions to the Nigerian Export Processing Zone Authority.
Stop funding the recurrent expenditure of the Maritime Academy of Nigeria, Oron but maintain the capital expenditure.
Stop funding Nigeria Football Federation as advised by FIFA.
Abolish Federal Character Commission and Fiscal Responsibility Commission.
However, the Federal Government is not prepared to sack workers, even though the President would decide what to reject and adopt out of the list.

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Economy

Aftermath of subsidy removal: Nigerians to buy Petrol for N462 per litre. — NNPC

The Eyewitness reporter

Nigerians have been advised to brace up for a tougher time ahead as the Premium Motor Spirit (PMS), otherwise known as petrol, is expected to sell for a minimum of N462 per litre.
This price will however come to effect after the expected removal of the controversial subsidy.
The Group General Manager, Group Public Affairs Division, Nigerian National Petroleum Company (NNPC) Limited, Garba Muhammad, dropped this hint on Sunday.
He claimed that the federal government currently pays N297 per litre for 68 million litres of petrol consumed daily to reduce the price of fuel at the filling station.
” But if the government stops subsidising PMS, the price will double” he declared.
The price of the product currently oscillates between N175 to N180 per litre.
However, the present government has tactically evaded the arduous task of subsidy removal which it has shifted till next year for the succeeding government to inherit.
Recall that the subsidy was scheduled for removal in January 2022,  however, President Muhammadu Buhari postponed it for 18 months and has not planned the second quarter of 2023 for the removal.

The NNPC spokesman, in a statement, also defended the consumption rate disclosed by the NNPC, after the Customs Comptroller-General, Col. Hameed Ali (retd.) faulted the oil company’s claim.

Ali had stated that NNPC couldn’t scientifically support the 98 million litres/day it claimed to have imported in a year, and only imports 38 million litres of PMS per day.
 Muhammad however insisted that 67 million litres had been imported per day between January to August 2022.
“The NNPC Ltd notes the average daily evacuation (Depot truck out) from January to August 2022 stands at 67million litres per day as reported by the Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA.

” Daily Evacuation (Depot loadouts) records of the NMDPRA do carry daily oscillation ranging from as low as 4 million litres to as high as 100 million litres per day” he declared.

On petrol and its cost burden which the NNPC now bears,  Mohammed said after oil marketing companies (OMCs) withdrew from PMS import in 2017, NNPC has been the sole supplier of petrol into the country.

 In the statement, Muhammad explained that “rising crude oil prices and PMS supply costs above PPPRA (now NMDPRA) cap had forced oil marketing companies’ (OMCs) withdrawal from PMS import since the fourth quarter of 2017.

“In the light of these challenges, NNPC has remained the supplier of last resort and continues to transparently report the monthly PMS cost under-recoveries to the relevant authorities.

“NNPC limited also notes the average Q2, 2022 international market determined landing cost was US$1,283/MT and the approved marketing and distribution cost of A46/litre.

“The combination of these cost elements translates to a retail pump price of N462/litre and an average subsidy of N297/litre and an annual estimate of N6.5 trillion on the assumption of 60 million litres daily PMS supply.

” This will continuously be adjusted by market and demand realities.

“NNPC Ltd shall continue to ensure compliance with the existing governance framework that requires the participation of relevant government agencies in all PMS discharge operations, including Nigerian Ports Authority, Nigerian Midstream and Downstream Petroleum Regulatory Authority, Nigerian Navy, Nigeria Customs Service, NIMASA and all others.” the statement concluded.
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Economy

CBN rescues ailing airlines with $265 million to settle outstanding ticket sales

CBN Governor, Godwin Emefiele

 

The Eyewitness reporter 

The  Central Bank of Nigeria (CBN) has intervened in the brewing crisis in the aviation sector when on Friday, it released the sum of $265 million to airlines operating in the country, to settle outstanding ticket sales.

A breakdown of the figure indicates that the sum of $230  million was released as a special Forex intervention while another sum of $35 million was released through the Retail SMIS auction.

Confirming the release, the Director, Corporate Communications Department at the CBN, Mr. Osita Nwanisobi said the Governor, Godwin Emefiele and his team were concerned about the development and what it portends for the sector and travelers as well as the country in the comity of nations.

Mr. Nwanisobi reiterated that the Bank was not against any company repatriating its funds from the country, adding that what the Bank stood for was an orderly exit for those that might be interested in doing so.

With Friday’s release, it is expected that operators and travelers as well will heave huge sighs of relief, as some airlines had threatened to withdraw their services in the face suffocating business environment.

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Economy

No more FAAC remittances and subsidy payment by new NNPC—- Kyari

Chief Executive Officer, (NNPCL), Mele Kyari
—-as FG spends N1.593trn on fuel subsidy, N54.66bn on refinery rehabilitation

Eyewitness reporter 

The Chief Executive Officer, (NNPCL), Mele Kyari, during the unveiling of the newly commercialised oil firm, had stated that the company was now a private outfit and had nothing to do with FAAC anymore.
Responding to a question on what would happen to NNPC’s monthly FAAC contributions, Kyari replied, “We are now a private company. Would MTN go to FAAC?”

When probed further to tell if there would be no more FAAC remittances from the company going forward, he said, “We will pay our taxes, royalties and deliver dividends to our shareholders.”

Asked about the arrears to FAAC that were not delivered by the firm over the years, the CEO said, “Which arrears? That’s Nigerian National Petroleum Corporation.”’

On how the oil firm would handle subsidy on petrol being a commercial entity, Kyari replied that fuel subsidy was not a burden of NNPC.

The CEO had said, “Subsidy is not NNPC’s burden. The subsidy is the decision of the state and in every jurisdiction anywhere in the world, countries see them differently. In some countries, they put petroleum tax on top of the market price of these products.

“So, when decisions are to be made in some jurisdictions, they will reduce the level of taxation. That also is another form of subsidy. In some countries, you have zero taxation but you will pay the market price for the commodity. That also in a way, in the fiscal system, looks at it from a subsidy point of view.

“In very many countries, a leader can decide that I don’t even want my countrymen to buy it at the market price. I’m ready to reduce that price for them so that they can buy.”

Kyari added, “In either case, whichever way the decision and the policy of the state decides, you know NNPC is there in the space to provide the product to the state at commercial value and, of course, it is also our duty to deliver to the customer at the price that the state wants.

“So it is no longer an NNPC issue. NNPC will have no issue with this. NNPC will be happy to supply because we will now see the state as our customer.”

However, the latest data on the amount spent on subsidising Premium Motor Spirit(PMS), popularly called petrol, showed that the government subsidised the commodity with N1.593tn between January and June 2022.
It was also gathered that the Nigerian National Petroleum Company Limited pumped N54.66bn into refinery rehabilitation during the six months period.

Figures obtained from the NNPCL’s presentation to the Federation Accounts Allocation Committee meeting for July 2022 showed that subsidies on petrol were implemented in June. The company transited from a public oil firm to a commercial entity last month.

It also made it clear in July that subsidy on petrol was now a burden of the Federal Government and not its own responsibility.

An analysis of the July presentation to FAAC showed that fuel subsidy or under-recovery/value shortfall, as described by NNPCL, rose to N1.593tn in the first half of 2022.

Figures from the report indicated that the amounts spent as subsidies on the commodity in January, February and March were N210.38bn, N219.78bn and N245.77bn, respectively.

A total of N271.59bn, N327.1bn and N319.18bn were spent as subsidies in April, May and June respectively.

On refinery rehabilitation, the oil company spent N9.11bn in January and made no expense in February and March. It invested another N9.11bn in the facility.

It spent N9.11bn in each of the months of April and May 2022 on refinery rehabilitation, while investing N18.22bn on the plant in June.

In April this year, the Minister of State for Petroleum Resources, Chief Timipre Sylva, said the April 2023 completion date for the rehabilitation of the Port Harcourt refinery was feasible and that the plant would refine 60,000 barrels of crude by early next year.

“This project kicked off second quarter last year and where they are now is quite impressive. It is on schedule. The commitment is to deliver 60,000 barrels per day from this refinery by the first quarter of next year, and, of course, we are quite happy,” Sylva had stated while inspecting the facility.

The NNPC officially signed the contract with Tecnimont SPA for the $1.5bn rehabilitation programme of the Port Harcourt Refining Company in April 2021 and had promised that the facility would be completed in 18 months.

Meanwhile, the company’s July presentation to FAAC stated that the sum of N391.529bn was the gross domestic crude oil and gas revenue for the month of June 2022.

It noted that the value shortfall on the importation of PMS recovered from June 2022 proceeds was N319.176bn while the outstanding balance carried forward was N1.01tn.

“The estimated value shortfall of N1,490,413,402,007.66 (consisting of arrears of N479,688,823,026.00 plus estimated June 2022 value shortfall of N1,010,724,578,981.66) is to be recovered from July 2022 proceed due for sharing at the August 2022 FAAC meeting,” the company stated.

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