The House of Representatives has resolved to set up a sub-committee of legally minded members to examine the provisions of the Nigerian National Petroleum Corporation (NNPC) Act to determine the legality of deducting revenue at source by the corporation.
This followed the justification by the group managing director of NNPC, Mele Kyari that the agency was backed by provisions of the law, which allow it to make deductions of their running costs at source from revenue generated.
Kyari stated this Tuesday when he appeared before the House committee on public accounts to answer queries by office of the Auditor-General of the Federation on dwindling government revenue from 2014 till 2020.
NNPC is queried on the deduction from source of the sum of N865 billion from N2.4 trillion it generated in 2015, which the Auditor-General, said was in violation of Section 162 of the constitution which provides that all revenue proceeds should be paid to the Federation Account.
The corporation is also queried on the non-remittance of N3.8 trillion of domestic crude oil sales; the non-collection of gas receipts for some months in the year; and the issue of refund of N450 billion among others.
But Kyari argued that the agency drew its authority to take the actions from the NNPC Act, a judgment of the Supreme Court and also the approval of the Attorney-General of the Federation.
“What we do is backed by the provisions of the law. First the NNPC Act is very clear that we should submit revenues net of our cost. There is also an informed decision of the Supreme Court and also the Attorney-General of the Federation, that that position is correct and supported by the provisions of the law,” he said.
Responding, the committee’s chairman, Oluwole Oke, said the NNPC was a public agency expected to operate at profit, hence it was untenable for it to spend what it generates as running cost.
Oke, who reserved ruling on the matter, said the committee was going to set up a sub-committee of legally minded members to examine the matter holistically so as to make an informed decision.
He said: “Let us compare the provisions of the NNPC Act with Section 88, 81 of the constitution. We need to read the provisions of the NNPC Act along with section 80, 81 of the constitution of the Federal Republic of Nigeria to be able to decide which is superior, and which we are to follow.”