Jonathan says subsidy was never removed on kerosene, defends Sanusi’s suspension

President Goodluck Jonathan

The president said he has the powers to suspend the CBN governor

President Goodluck Jonathan on Monday made light a weighty allegation that billions of Naira was spent by his administration on kerosene allegedly in defiance of a subsisting presidential directive abolishing subsidy on the commodity.

For several weeks, the Senate and House of Representatives committee on petroleum probed allegations that Minister of Petroleum Resources, Diezani Alison-Madueke, spent multi-billion Naira of unappropriated funds on a controversial kero-direct scheme.

The scheme was pursued in defiance of a presidential directive by the late President Musa Yar’Adua abolishing subsidy on household kerosene, HHK, popularly called kerosene. PREMIUM TIMES had published the memo by late Mr. Yar’Adua directing the stoppage of subsidy on kerosene.

The minister of petroleum had claimed, while appearing before the senate, that such presidential directive was not binding on her.

The Kero-Direct scheme saw the Pipelines and Products Marketing Company, PPMC, the petroleum products marketing and distribution subsidiary of the Nigerian National Petroleum Corporation, NNPC, collaborating with Capital Oil, owned by Ifeanyi Ubah, to distribute kerosene to consumers nationwide at the subsidized price of N50 per litre. Separate investigations had shown that despite the billions spent on the kerosene subsidy, the product hardly ever got to consumers across Nigeria at the subsidized price.

But, speaking publicly on the allegation for the first time, President Jonathan, in his first presidential media chat in 2014, said that he did not understand why people would be brandishing photocopies of documents that have since been forgotten and circulating same as a presidential directive.

“Kerosene still remains a subsidized product. There was no particular period that it was announced that kerosene is no more a subsidized product,” the president said.

“The law governing petroleum products is very clear. If one is to increase or decrease the price of any petroleum product, the law says one has to advertise it in newspapers to inform Nigerians stating the date and the time to enable all the stations change at the same time. So, somebody going to files to get and circulate photocopies of documents that have been forgotten, I don’t know what he wants,” he said.

As the then Vice President to late Mr. Yar’Adua, the President said he was personally involved in the decision not to go ahead with the initial proposal to implement the policy of full deregulation in the downstream sector of the petroleum industry.
He said, at about 2008/2009, international crude oil price had dropped significantly, while the pump price of petrol was N70 to the litre and kerosene was N50.

The President said labour leaders had persuaded government to have a rethink of the latter’s proposal that petrol be completely deregulated, while subsidy on kerosene is completely removed.

He said the NLC and other stakeholders had argued that if government went ahead to remove subsidy on kerosene, the benefit of lower prices would be temporary, as crude oil prices would soon rise again within a short period.

On the controversy whether he had the power to order the suspension of the Central Bank of Nigeria, CBN, governor, Lamido Sanusi, President Jonathan said he believed he has “absolute powers to suspend the CBN governor.”

He said despite the suspension, Mr. Sanusi was still the CBN governor, pointing out that until all the issues were sorted out, or Mr. Sanusi’s tenure ends, there would be no new substantive governor.

Noting that Mr. Sanusi could come back tomorrow to continue his work, Mr. Jonathan said the issues raised by the Financial Reporting Council, FRC, of Nigeria were such that the board of the Central bank would have to sit with them to look into the financial transactions of the CBN.

He said the reason Mr. Sanusi was asked to step aside as CBN governor was to avoid undue interference in the investigations by the FRC.

The President said the long delay in the decision to suspend the CBN governor was as a result of his realization that the issue was very delicate and had to be dealt with carefully by holding wide consultations on it.

“It is a sensitive issue when it has to do with the CBN. When one is dealing with a treasury of the nation, one has to be careful. One has to consult widely. One has to take all the necessary steps to ensure that asking the CBN governor to step aside does not affect the economy,” he said.

He said he decided to edge out Mr. Sanusi as CBN governor, leaving his deputy governors, to enable them take charge of the management, while the FRC continued with the investigations.

“By the first quarter of this year, the 2013 audit report was supposed to be published. We have finished the 2012 audit and to publish it before we go into 2013. We had to take steps to reassure the international community that whatever is happening would not affect the CBN and the economy,” he said.

Dismissing suggestions that the suspension was not done at an appropriate time, in view of the unresolved allegation of the missing $20 billion oil money, the President accused Mr. Sanusi of making contradictory claims, thereby making it difficult to believe the figures.

He said government was not contemplating prosecuting Mr. Sanusi, except, if in the course of investigations, he was found to have committed an offence that was criminal in nature.

On the possible amendment of the CBN Act, the President confirmed that the law may be amended, saying he had asked the National Assembly to look at the possibility of an amendment in line with the best global practice.


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  • arewethishopeless

    I dont understand what this thief is talking about. Or is it because the President who signed the directive is not alive today? GEJ please give one example of a presidential directive that has ever been issued in the past and was ignored by the concerned minister. Name just one? Did the FEC not approve the directive of the late president? Is this how you wish to insult the memory of Yar’adua?

    Of course, a thief will never come out and say “Oh, sorry. I stole the money.” No, rather a thief will make a bold face to Nigerians and say “documents we have forgotten …”. With focus on SLS rather than what he has done to recover the missing funds shows a thief with plenty to hide. What is funnier is how GEJ now blames Nigerians for all this mess by saying “If you had allowed me to remove subsidies all this noise ….”

    How do you ask the international community to come to our aid to stop theft at pipelines and the business of our stolen crude when you preside over monumental theft during the actual sale. We are truly the laughing stock of the world ….

    GEJ, Nigerians know you will not come out to admit theft but we will not relent. You have stolen from the wrong generation. You, your “ashewos”, looters, ritualist and sexual predators will return every kobo. Its a promise.

    • Angryman

      Sorry , how many days to your ultimatum
      You [? deliberately ] omitted an important part of GEJ explanation
      Let me remind you – “The law governing petroleum products is very clear. If one is to increase or decrease the price of any petroleum product, the law says one has to advertise it in newspapers to inform Nigerians stating the date and the time to enable all the stations change at the same time.
      Since Yar’adua said it should not be publicized, he had already went foul of the law making it [ his order ] null and void

      • Ide4u

        Was he not there when Ya’Ardua gave that presidential directive? He should have kicked against it.

        • Angryman

          Yar ‘adua was the President – the person in charge- wasn’t he?

          • Babs

            So, what was his role then, a hypocrite, abi?

  • Jr IBE

    I’m the change guys, I’m 21, and I believe by 2045 I will be the Nigerian President! I swear to God my 1 year in office will be better than GEJ 5 years in power! I will make Nigeria a paradise! The world will adore us! I don’t care how many we are, 150 million 500 million it doesn’t matter, every citizen will get a monthly salary! Talking of peace, u will never hear a bomb blast unless you hear it in TV on a cinema couch drinking a milk shake. I love you people and GEJ and our current leaders hate you!
    God bless us and Nigeria

    • Ide4u

      Hold on to your dream and work towards it. May God be with you!

  • Issei

    Mr president fear God,because you will one day join president yaradua.

  • Ikechukwu_67

    Ok Mr president, could you now show us where in 2012, 2013 or 2014 budgets that you have made provisions for this subsidy? Atleast we know about the provision for petrol subsidy in the said budgets, please avail us where it is. If it is not in the budgets and you claim that the subsidy still subsists then it only means one thing: “OPEN STEALING”. You just admitted to stealing if this subsidy is not in the aforementioned budgrts. We sre waiting!!!!