Jonathan Writes Legislature on Oil Benchmark, May Boycott Budget Presentation Today

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President Goodluck Jonathan has written to the National Assembly to express his concern over the crude oil benchmark pegged at $79 per barrel by the House of Representatives, stating that without a resolution of the benchmark it will be futile to present a budget that would cause rancour between the executive and the legislature and delay its passage.

Accordingly, THISDAY learnt from presidency sources Monday that the president may shelve the presentation of the 2014 budget today until a consensus is reached between both arms of government on the benchmark.

A presidency source said the president’s decision to defer the budget's presentation was triggered by the decision by the House of Representatives to renege on an understanding reached between the executive and National Assembly to peg the crude oil benchmark at $76.5 per barrel.

Under the 2014 – 2016 Medium Term Economic Framework (MTEF) and Fiscal Strategy Paper (FSP), the executive had proposed $74 per barrel. However, following an understanding reached between both arms of government, a joint Senate and House Committee of Finance and Appropriation, raised the benchmark to $76.5 per barrel two weeks ago.

But whereas the Senate kept to its end of the bargain when it passed the MTEF/FSP last week, the House hiked the benchmark to $79 per barrel, causing consternation among the executive.

Meanwhile, the federal government has debunked allegations by Rivers State Governor Chibuike Amaechi that $5 billion is missing from the Excess Crude Account (ECA), describing the allegation as “absolutely shocking and false”.

It pointed out that the governor could not have denied knowledge of the status of the ECA, when his state benefitted handsomely from the share of the $5 billion, which was severally used to augment revenue shortfalls for sharing to the three tiers of government.

Amaechi had alleged during a meeting of his faction of the Nigeria Governors’ Forum (NGF), in Sokoto at the weekend, that $5 billion had disappeared from the Excess Crude Account and demanded explanations from the government agencies responsible.

Reacting to the allegation in a press statement yesterday, the Federal Ministry of Finance said: “Amaechi cannot credibly deny knowledge of the status of the ECA,” adding that “he has been closely involved and actively participated in making requests to the presidency for the ECA to be shared for the purpose of augmenting the regular allocations from the Federation Account whenever there was a shortfall.”

According to the statement, the $5 billion in the ECA, which Amaechi alluded to, had been shared to the three tiers of government to make up for the revenue shortfalls during the Federation Account Allocation Committee (FAAC) process.

“Part of this fund also went for SURE-P payments and the balance for subsidy payments to oil marketers,” it added.

The ministry, which provided empirical evidence to buttress its claim, said Rivers State received N56.2 billion, the second highest share among the states, from January to September 2013 from the ECA, adding that the amount included N43 billion for shortfalls plus N12 billion released for the Subsidy Reinvestment and Empowerment Programme (SURE-P).

“In fact, earlier this month (November 2013) Rivers State along with other states, benefitted from the sharing of $1 billion from the ECA to augment the allocations.

“It is therefore curious that Governor Amaechi seems not to know the whereabouts of the N56.2 billion which Rivers State has received from the ECA this year,” the statement added

The statement also faulted Amaechi’s allegation that the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, refused to sign the African Development Bank (AfDB) loan for a water project in Port Harcourt.

“The loan in question has been appraised but it is yet to be negotiated. Before the minister can sign it, it has to go through the negotiation process and be considered and cleared by both the Board of the African Development Bank and the Federal Executive Council. So the issue of the minister refusing to sign it simply does not arise.

“Dr. Okonjo-Iweala handles issues concerning the states on the basis of professionalism and equity,” the statement said.