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From Isaac Anumihe, Abuja
Federal Government has set aside a total of N327 billion in the 2022 Budget to offset the electricity tariff shortfall incurred by the Ministries Departments and Agencies (MDAs) who are not paying electricity bills.
While N27 billion goes to the MDAs, N300 billion would be used to settle other tariff indebtedness which the distribution companies (DisCos) incurred because of their inefficiency.
Speaking at a 2022 Budget Breakdown, organised by the Ministry of Finance Budget and National Planning, at the weekend, in Abuja, the Director General of Budget Office, Mr Ben Akabueze, said that the government is a shareholder in the DisCos but the government has not started collecting dividends from them.
“The government is a shareholder in the companies. But as a shareholder, you don’t collect part of the revenues the company collects. We share in the profit of the company when the company makes a profit and declares a dividend. So, the billings of DisCos are not part of government revenues.
“On the contrary, because the electricity tariff that we all pay does not cover the cost of producing the power, there is a shortfall which the government has to incur on behalf of the citizens. In 2022, the tariff shortfall is projected at N300 billion and we provided for it. This is the money that we have to pay.
We provided another N27 billion for the MDAs electricity use. And that is government trying to lead by example. Many MDAs are defaulting in paying electricity bills”, Akabueze, declared.
However, going forward, the government has put a mechanism in place to make it difficult for MDAs to incur electricity bills and not pay for it.
“While we are trying to resolve the historical situation, going forward we are going to tighten up and provide a mechanism where MDAs can’t incur utility or electricity debts and leave them behind. So, instead of us receiving from the DisCos from this budget, there is a provision in this budget to pay money to the DisCos.
