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From Uche Usim, Abuja
When the Nigeria Extractive Industries Transparency Initiative (NEITI) and the Nigeria Financial Intelligence Unit (NFIU) signed a Memorandum of Understanding (MoU) to share information and data to check fraud and other financial malfeasance in Nigeria’s extractive sector operations in October, the former described it as a most welcome development.
According to the Executive Secretary of NEITI, Dr. Orji Ogbonnaya Orji, such MoU also exists with the Economic and Financial Crimes Commission (EFCC) and other security agencies, as it seeks to cement a collaboration on information and data sharing and joint preventive and remediation action on governance, process and corruption issues in Nigeria’s extractive sector.
He spoke on the sidelines of the MoU signing event.
Excerpts:
MoU with NFIU
With the MoU finally signed, the next stage is to activate the contents of the agreement and this will happen in the next couple of months. The essence of this partnership is underpinned in our partnering with NFIU to providing intelligence, information and data on the extractive sector industries that will aid investigation into infractions that border on criminality in Nigeria’s oil, gas and mining sectors, especially in the areas where these activities undermine our national securities as revealed in the NEITI Audit Reports, Occasional Papers and Policy Briefs, as well as regular capacity building, trainings and awareness workshops”, he explained.
NEITI has the information and data on extractive sector operations and we applaud the collaboration with sister agencies which is yielding dividends. It gives us great comfort that there are sister agencies that are committed to national governance and development priorities like NEITI. We have identified the NFIU as one of them and will work very closely with them to achieve the objectives especially in the area of knowing who actually owns Nigeria’s oil, gas and mining assets.
This is a fundamental step in our relationship with NFIU considering the strategic importance of the extractive sector to our economy and the extensive work NFIU is doing in the sector. This collaboration will strengthen our partnership and enable us to support each other and the Nigerian state. NEITI is committed to the continuous and spontaneous disclosure of data and information that will ensure that more recoveries of unremitted funds into government coffers are made and support the validation of any disclosed data. NEITI is ready to support the recovery of all unremitted funds into the treasury.
NEITI’s job is to provide information and data on transactions and operations in Nigeria’s extractive sector and put the information in the public domain. It is the responsibility of policy makers, the media, civil society and the citizens to use the information and data to hold the government and companies accountable. So, when we find in our reports some money that can be deployed to address citizens’ demands for good governance, it is our job to escalate these findings.
77 companies owing Nigeria N2.659 trillion
Yes, 77 oil and gas companies in Nigeria are indebted to the federation to the tune of N2.659 trillion. The debt arose from failure to remit petroleum profit tax, company income tax, education tax, value added tax, withholding tax, royalty and concession on rentals. That was our 2019 audit report finding which shows that the oil and gas companies in Nigeria owe government about $6.48 billion which equals about N2.659 trillion at today’s exchange rate of N410.35.
A breakdown of the figures show that a total of $143.99million is owed as petroleum profit taxes, $1.089billion as company income taxes and $201.69million as education tax. Others include $18.46million and £972Thousand as Value Added Tax, $23.91million and £997Thousand as Withholding Tax, $4.357billion as royalty oil, $292.44million as royalty gas, while $270.187million and $41.86million were unremitted gas flare penalties and concession rentals respectively.
In 2021, if the money is recovered, the 2.659 trillion could fund about 46 per cent of Nigeria’s 2021 budget deficit of N5.6 trillion and is even higher than the entire projected oil revenue for 2021. This is why NEITI is set to work with the government to provide relevant information and data to support efforts at recovering this money. The disclosure of this information is in line with NEITI’s mandate to conduct audits, disseminate the findings to the public to enable the citizen’s especially the media and civil society to use the information and data to hold government, companies and even society to account. It is important that the process of recovering this humongous sum be set on course to support government in this period of dwindling revenues.
We therefore appeal to these companies to ensure that they remit the various outstanding sums against them before the conclusion of the 2020 NEITI audit cycle to the relevant government agencies responsible for collection and remittances of such revenue.
NEITI will no longer watch while these debts remain in its reports unaddressed. We will provide all necessary information and data to sister agencies whose responsibilities are to recover these debts into government coffers. We will do also share the information and data with our partner anti-corruption agencies with whom we have signed MoUs.
Other News
Knowledge gap to fill
Following my appointment, I feel there is a wide knowledge gap that needs to be filled in terms of where NEITI is today? Where does NEITI want to be? How does NEITI get there? I have clear knowledge and ideas of what I want to do for NEITI in the next couple of months. The President of Nigeria has given me an opportunity but I don’t think I should go it alone. I needed to validate those ideas with the staff to be able to have a buy-in of staff and I was amazed at the quality of inputs, quality of suggestions, quality of interrogations of my own views of how things could be done that came out of this knowledge sharing session. It was a very robust one week that we locked ourselves up in one room. And the whole idea was how will NEITI link it’s objectives, mandates and implementation of its programmes to impact the lives of Nigerians and in the quality of governance in our country and those things that came out.
One unique thing that came out of this whole process was that all the resource persons were in-house.
We needed to talk to ourselves so you will be shocked that it was most encouraging for me that the quality of resource persons that we had were all in-house from NEITI because whoever wears the shoes knows exactly where it pinches. We didn’t want to depend on people who could begin to make recommendations to us without diagnoses. So, these people were involved in the day-to- day running of NEITI, the day-to-day operation of NEITI over the last five years and they know exactly where the lapses are and we were able to talk to ourselves. We came out strongly with opinions, ideas, suggestions and implementation strategies that can take effect for a short, medium and long term. It was a very robust one week deliberation and we are good to go.
What is the strategy in place, how do you plan to get there?
We have not formulated the strategies at all. Knowledge sharing session has now generated a staff-based knowledge of what needs to be done. We have set up a 10-man team that is now going to articulate these ideas into a strategy and that 10-man team will be inaugurated on Monday. So, those are the kind of decisions that we have made. It’s not concluded yet, we have generated the knowledge that we need, the ideas that we require, but we need to shape the ideas into a strategy. I have put in place a 10-man team made up of all staff and consultants working with NEITI, 10 bright young men and women within NEITI that will go into work on Monday to put them into shape but before then, there are already ideas that are like low hanging fruits that can be plucked which we need to work with. So, we will run with those ones while the strategies are being developed.
Targets
I have only five years to make impact. I don’t have option of a second term and I don’t want those five years not to be accounted for. Every minute of my tenure should be accounted for. So, I am in a hurry. I am in a hurry to get the job done because I am ready for this job. I am trained for this job, I am equipped for this job. So, God being on our side, we want to make sure that by the time I look back in five years, there will be credible impact. I didn’t come here to learn. I have been part of this organization before the President gave me this opportunity. So, the time other people will use to learn, I am already on the job. I am in a hurry to deliver impact God being on our side because the job is there, the challenges are clear. When I mean I am in a hurry, I mean we will deliver quality service based on knowledge and strategies. It is not to hurry anything but I do not think we have time to waste because the job the organisation has to do in the extractive industry is huge and except and until we get the extractive industry, mining (solid minerals in particular) to get activities going to generate revenue for the government, we can’t say the job is done. I don’t like the government asking for money when we are sitting on natural resources that if properly managed, we could generate a lot. We need to help government. NEITI is ready to help the government generate revenue and any idea that comes this direction, we are in a hurry to harvest them and put them to practice.
Progress in execution
Yes, I have been moving around like I told you. We are an agency that is built on a multi-stakeholder coalition, government, companies, civil societies. You can’t get one without the other. We met with civil societies, the media, we met with the companies. Last week, I was in Lagos to meet with the regulator in the industry (DPR) and like you rightly said we also needed to meet with the Accountant-General because the Office of the Accountant-General is one of our covered entities and they have a role to play. They are the treasury house that will house the revenue accrued to government. So, we needed them to understand what the EITI principles are and what these tenets of accountability and transparency are. It is the Office of the Accountant-General that will appoint a Chair for the Inter-ministerial Task Team that will oversee the implementation of our recommendations in all the agencies. That is the leadership the Office of the Accountant-General has offered us to lead and Ahmed Idris, the Accountant-General of the Federation, we are grateful to him. The ball is in our court. He has asked us to make those appointments. We will be reaching out to him in the next couple of weeks and when that is done, he would help us put that in check to Chair that. That is why we met him. We also met him to help look at our budget to help us; that money that has been appropriated, it is important it is released to us. If people don’t know your problem, they won’t know how to solve it for you. So, we have been moving round so that people will know NEITI. Some don’t know what our job is all about, by the time they understand our job, they will now find a space to help us.
Contract transparency
Well, on contract transparency, I, Orji Ogbonaya Orji, the Executive Secretary has just been elected as the international Chair of the Global Contract Transparency Network, covering 20 countries around the world. The counties include Amenia, Cameroon, Chad, Congo, Ghana, Guinea, Guyana, Indonesia, Malaysia, Malawi, Mexico, Mongolia, Mozambique, Maymar, Nigeria (which I am representing), Philippines, Senegal, Sao Tome and Principe, Tanzania, Togo and Zambia. These are countries that will be depending on what we are doing to develop their own framework and tools of engagement on contract transparency and the NEITI Executive Secretary representing Nigeria in the global network has been elected globally to Chair that. The announcement was conveyed to us here in this forum. The Country Manager of the EITI has now said that while I wait for formal letter conveying that appointment to come in from Oslo, Norway, were the Global network headquarters is located, I am expecting that letter of appointment to now define the global approach to contract transparency Nigeria will be leading. The appointment of Nigeria in that network not only to be a member but to Chair it is believed by me to be a recognition of the extensive work we have put in place in developing a framework on gauging companies on contract transparency.
Recently, I had a one hour meeting with the GMD NNPC on how the NNPC and NEITI can develop a framework of engagement beginning with NNPC disclosure of certain contracts that they are currently pursuing. We need to develope that framework and the framework will specify what do we disclose, how do we disclose, and at what time, who will consume the information that will be disclosed and how will that information be used in a way and manner not to jeopardize the operations of the covered entities in a manner that is open, transparent and information accessible. I am not able to make further comments on this because the GMD NNPC and I and also the Director and Executive CEO of the DPR have agreed to form a nucleus committee to develop a framework that will guide our organizations, protect the interest of our country, protect he sovereignty of our country, and then still provide information that will useful to investors, useful to the citizens, useful to the civil societies and the media. That framework will be developed. In the next couple of days that joint committee between NEITI, NNPC and DPR will be set up and we will take it up from there. On the global level, you could see the larger platform on which NEITI has been elected which I will be chairing to play in the global arena. And it is the job we have done at home that will be exported outside. That is why the whole idea is incubating.
Achievements
The re-constitution and inauguration of the NEITI Board; commencement of process of reviewing of NEITI Act to strengthen its powers and functions; timely publication and presentation of the reports; securing permanent office accommodation for the agency after 17 years of squatting on rent; sustained and diversified partnerships with key stakeholders and partners.
Other achievements are: the appointment of NEITI into the implementation of the PIA; commencement of the development of a 5-year NEITI Strategic Plan (2022-2026); NEITI Audit Automation Project; Nigeria’s involvement in Opening Extractives program; NEITI’s appointment to lead the global EITI Contract Transparency Network; Designing of a new, functional and Interactive website and reconstitution of the civil society and communication sub-committee among others.
