Reps Fume Over Alleged NNPC’s Disregard For Audit Summons
The House of Representatives’ Committee on Public Accounts has expressed its frustration on the way the management of the Nigerian National Petroleum Corporation, and its subsidiaries have been avoiding appearing before it despite series of invitations.
This is as the panel also vowed to invoke relevant sections of the 1999 Constitution (as amended) to compel the Group Managing Director of the a Corporation, Mr Mele Kyari and heads of 17 subsidiaries to respond to various audit queries bothering on deliberate and reckless refusal to render accounts from 2014 to 2018 in breach of extant financial regulations.
The affected agencies include: Nigerian Petroleum Development Company Limited; Kaduna Refining and Petrochemical Company; Petroleum Products Marketing Company Limited; Duke Oil Company Inc.; West Africa Gas Limited; Nidas Marine Limited; Hyson (Nigeria) Limited and Nigerian Gas Company.
Others are: National Engineering and Technical Company; National Petroleum Exchange; NNPC Pension Limited; Warri Refining and Petrochemical Company; Port Harcourt Refining Company; NNPC Retail Limited; Integrated Data SERVICE Limited; National Petroleum Investment & Management Services and Petroleum Product Pricing Regulatory Agency.
According to the lawmakers, NNPC allegedly directed all the heads of the 17 subsidiaries invited to the public hearing not to honour the invitation sent by the House Committee on Public Accounts, in breach of extant legislations and provisions of the 1999 Constitution (as amended).
According to a letter with Reference No: HR/PAC/SCO5/9NASS/PARA.5/001 dated 20th December, 2019, addressed to the NNPC Group Managing Director, the House had during its plenary session of Tuesday, 10th December, 2019 mandated the Public Accounts Committee to conduct an in-depth investigative hearing on the deliberate and reckless refusal of non-Treasury funded agencies of government to be audited by the OAuGF for the period under review.
This was with a view to ensuring compliance with the provisions of Sections 80, 81, 85, 88 and 89 of the 1999 as well as Sections 15, 18, 20, 22, 24 and 25 of the Public Procurement Act, 2007.
In its second letter dated: 24th December, 2019 with Ref. No: HR/PAC/SCOS/9NASS/PARA.5/064 signed by its Chairman, Hon. Wole Oke and specifically addressed to the NNPC Group Managing Director, and heads of various subsidiary agencies, the House requested for copies of approved budget both appropriation and internally generated revenue between 2014 and 2018; audited and management accounts; budget performance report; evidence of remittance of audited accounts to the Auditor-General of the Federation; evidence of remittance of internally generated revenue and or operating surplus to Consolidated Revenue Fund account to the Committee ahead of the investigative hearing.
In its third letter with Reference No: HR/PAC/SCOS/HR.252/12/2019/001, dated 10th January, 2020 and addressed separately to the NNPC Group Managing Director and heads of the 17 subsidiaries, they were “invited before the Public Accounts Committee on Thursday, 30th January, 2020 at 10:00am.”
In its response to the Committee’s invitations to the investigative hearing, PPMC via a letter with Reference No: PPMC/HQ/MD/11.01 dated 24th January, 2021 and signed by Mohammed S. Umar, noted that: “The letter from NNPC Corporate headquarters on subject stipulating that NNPC headquarters and all subsidiaries of NNPC including PPMC have a consolidated Group Audited Accounts that is centrally submitted to the Auditor General to the Federation in line with the NNPC Act.”
But in its fourth letter with Reference No: HR/PAC/SCOS/HR.252/12/2019/212 dated 24th January, 2020 addressed to the NNPC Group Managing Director, the panel announced a new date for the NNPC GMD and heads of the 17 subsidiaries to appear on Tuesday, 4th February, 2020, urging that “You are to come along with officers who are familiar with the issues at stake and may assist in provide answers to any question that could arise during the hearing.”
However, in its response to the Committee’s inquiry, PPMC via a letter with Reference No: PPMC/HQ/MD/1.01 dated 31st January, 2020 signed by Mohammed S. Umar stated that: “A detailed submission was received and acknowledged in your office via a letter from the office of the NNPC’s Chief Financial Officer (CFO) on the 27th of January, 2020.”
The committee in its fifth letter with Reference No: HR/PAC/SCO5/HR.252/12/2019/275 dated 4th February, 2020 while acknowledging the receipt of the PPMC’s letters with Ref. No: PPMC/HQ/MD/11.01 and PPMC/PPMC/HQ/MD/1.01 dated 24th and 31st January, 2021, observed that consolidated group audited accounts centrally submitted on behalf of NNPC and all subsidiaries to the OAuGF, is insufficient evidence to the Committee.
To this end, the Committee urged the PPMC Managing Director to: “Take notice that the Committee shall no longer condone your refusal to honour civil invitation. Be warned that unless you honour this last invitation, the Committee may take recourse to its legislative powers under Sections 88 and 89 of the 1999 Constitution (as amended) and extant laws to compel your appearance.
“In view of the above, you are to cause appearance before the Committee unfailingly on Monday, 10th February, 2021 by 10:00am. You are to come along with officers who are familiar with the issues at stake and may assist you provide answers to any question that could arise during the hearing,” Hon. Oke stated.
Worried by the repeated disregard for the Parliament, the Committee had via a 3-page letter dated 11th February, 2020 and addressed to the NNPC Group Managing Director and Chief Finance Officer, acknowledged the receipt of a letter with Reference No: CFO/11.04 which detailed the response of the NNPC Chief Finance Officer, reaffirmed its stance for the NNPC Group Managing Director and heads of all the subsidiaries to submit relevant documents and appear before the Committee and give account of their stewardship.
Oke cited the provisions of Sections 85(4), 88 and 89 of the 1999 Constitution (as amended) which empowered both the OAuGF and House of Representatives to carry out investigation into any matter or conduct of affairs of any person, Ministry, Authority, Government Departments.
He said: “In view of the foregoing, the Committee wishes to restate its initial request for the production/submission of documents as it relates to the subsidiaries of the Corporation and to emphasize that the Committee has powers to demand for any paper, book, record or document in possession of any person.
“The reasons advanced by Umar Ajiya Isa, Chief Financial Officer, are not tenable and does not take cognizance of the constitutional role and powers of the Committee.”
However, in its response to the Committee’s request, NNPC via a letter with Reference No: GGM/GPAD/07 dated February 19, 2020 signed by Samson Makoji, on behalf of the Group General Manager, Group Public Affairs Division, said: “We regrettably state that the GMD NNPC, Mallam Mele Kyari, the Chief Financial Officer, Mr. Umar Ajiya, and other key Executives of the NNPC have undertaken a compelling official trip out of the country geared towards the strategic interest of the economy of the nation.
“Arising from the above, honourable Chairman, the GMD has requested that you kindly consider and reschedule NNPC’s appearance at your esteemed Committee to a future date, and do express deep regrets on our absence.”
The Committee also criticized the NNPC’s latest letter with Reference No: NNPC/GPAD/008.5 dated 5th January, 2021 signed by Dr. K. A. Olateru, Group General Manager, Group Public Affairs Division, in which he urged the Committee to direct all enquiries about Port Harcourt Refining Company to the NNPC Group Managing Director.
It stated, “We refer to your letter dated 7th December, 2020 with Ref. No: HR/PAC/SCO5/9NASS/QUE.9/984 to the Managing Director, Port Harcourt Refining Company on the Committee’s constitutional mandate over matters relating to public finance management audit and expenditure and the subsequent resolution of the Honourable House to conduct an in-depth investigative hearing on the refusal of MDAs to render audited accounts to the Auditor General for the examination.
“The Chairman is kindly invited to note that PHRC is a subsidiary company of the NNPC and all budget and audit matters are handled by the corporate headquarters for the NNPC group.
“Consequently, kindly direct your enquiries as contained in your referenced letter to the Group Managing Director, NNPC.”
While giving an update on the development, members of the House Committee on Public Accounts, on Friday unanimously resolved to invoke relevant sections of the 1999 Constitution and Legislative Houses (Powers and Privileges) Act, 2018 on the NNPC and it’s 17 subsidiaries to appear before the Committee unfailingly on the various Audit queries of the Office of the Auditor General of the Federation immediately.