NEITI Threaten Financial Crime Cases Against Oil Firms Owing Nigeria

L-R: Chairman, FRC, Barr Victor Muraoko; Chairman House of Reps Committee on Public Account, Hon. Wole Oke; ED, Orderpaper, Oke Epia; International development consultant, Prof. Ken Ife and ES, NEITI, Dr. Orji Ogbonnaya Orji,.during the GIFT Nigeria project development Dialogue series in Abuja on Wednesday .

By Juliet Ukanwosu

Oil and gas companies operating in Nigeria with lingering issues of unremitted revenue to the Nigerian government have between now and year end to pay up their liabilities or face financial crime cases, the Nigeria Extractive Industries Transparency Initiative (NEITI) has said.

This position was disclosed in Abuja on Wednesday by the Executive Secretary of NEITI, Dr. Orji Ogbonnaya Orji, while speaking at the Growth Initiatives for Fiscal Transparency (GIFT) dialogue organised by Orderpaper Advocacy Initiative.

Dr. Orji explained that NEITI beamed its light on payments, remittances and withheld revenue to the government in the past two cycles of audits covering 2019 and 2020, which led to the disclosure that 77 companies in the oil and gas sector owe government over N2.6trillion in unpaid taxes and other levies in 2019, describing the situation as totally unacceptable at a time when government is borrowing to fund the budget.

However, he said the number dropped to 51 companies in 2020, with withheld revenue reducing to N1.32trillion, an indication that some of the erring entities paid up their liabilities following NEITI’s disclosure.

While urging indebted firms to approach relevant agencies of government and pay up, Orji warned that by the time the NEITI 2021 audit report, expected by year end, is released, companies still withholding 2019/2020 remittances will no longer be viewed as indebtedness, but will be handled as cases of financial crimes, over which NEITI will activate existing MoUs with relevant anti-corruption agencies.

He said, “In our 2019 report we raised alarm on the huge amount of money owed government by companies doing business in Nigeria to the tune of N2.6trillion. We gave a breakdown of the 77 companies owing that money and the revenue streams that were being owed.

“We are grateful that the leadership of the House of Representatives took that matter up in line with their role, so by the time we were releasing the 2020 report, the number had gone down from 77 to 51 companies that owed the federation.”

Hon. Oke and Dr Orji during the dialogue

Speaking further, the NEITI boss said, “But we are using this opportunity to appeal to all the companies that government needs this money today, not tomorrow. By the time we finish our 2021 report and if there are still instance of owing the government for 2019/2020 we may have no choice than to activate the MoUs we have with relevant anti corruption agencies, because it will no longer be ordinary indebtedness or liability, it will be looked at as financial crime; to do business in a country and refuse to pay tax.

“We do hope that between now and the time we publish our 2021 report, that all the companies owing the government would have gone to the relevant government agencies to pay up to enable the government have the resources that could be channeled to address national priorities,” Orji stated firmly.

He informed that the 2021 audit has commenced, with the NEITI team and auditor’s working round the country, adding that the report is expected to be published by the end of the year.

Also speaking at the event, Barr Victor Muruako, Executive Chairman, Fiscal Responsibility Commission (FRC) stated that the Commission has spared no efforts working to reverse the tide of the revenue crisis despite statutory limitations. He said the commission has “bent over and stretched resources to lead and support all efforts to flag and possibly prevent fiscal rascality, promote fiscal responsibility and block leakages and wastages in Public Finance space.”

These efforts he said include pushing for the enforcement of the Operating Surplus template for remittances by scheduled corporations and appropriate payment of Internally Generated Revenues (IGR) by non-scheduled Ministries, Departments and Agencies (MDAs) of the Federal Government. To enable it perform its role more effectively, Muruako appealed to the leadership of the National Assembly to conclude the amendment of the Fiscal Responsibility Act (FRA), 2007, before the end of the 9th Assembly.

For his part, Chairman, Public Accounts Committee in the House of Representatives Hon Oluwole Oke, regretted that despite having same potentials as Saudi Arabia, the Nigerian National Petroleum Corporation (NNPC) has hardly remitted any revenue to the federation account since first quarter 2022 despite the current rise in oil, while Saudi Aramco is presently the largest company on earth with a revenue of $2.3trillion ahead of Apple, Tesla, Microsoft and other top global companies.

Hon. Oke lamented the porous fiscal responsibility system in the country, highlighting instances where agencies of government get budget approvals without passing through proper legislative process, leading to distortion in the economy and ultimately more borrowings.

While also faulting the Nigerian free trade zone system, he pointed out that the Oil and Gas Free Zone for instance, should be a licensee of NEMZA. He disclosed plans to sponsor a bill to repeal the law setting up the oil and gas free zone authority describing it as a revenue drain, with many companies previously paying tax suddenly moving to the free trade zones.

In his remarks,  Executive Secretary of OrderPaper, Mr Oke Epia, expressed concern over the International Monetary Fund (IMF) alert that Nigeria may be spending 100% of her revenues on debt servicing by 2026. Such concerning prospect, he said,  signposts the grim reality of our time where Nigeria’s rich natural resource endowments have turned in very little or no benefits to her citizens, underscoring the need to address our fiscal responsibility challenges and shore up revenue.





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