Buhari’s Corruption War vs NNPC’s Non- Full –Disclosure Transactions

Buhari and Falana

Lagos based lawyer and human rights activist, Chief Femi Falana (SAN) earned his relevance in the country due to his nerve for details and unquenchable appetite to articulately use same to promote social order, justice, equity and economic emancipation.

Most times, he braved the odds and stepped on toes to achieve results.

Consequently, most Nigerians and indeed, international community were not surprised when he recently  wrote  the Nigerian National Petroleum Corporation(NNPC)  demanding  to know how the  state institution managed the  country’s  hydro carbon assets, as they believe that the fiery lawyer didn’t delve into unfamiliar turf or engaged in Afganistanistanism.

They were convinced that Falana’s enquiry which he rooted through the Freedom of Information (FOI) law, couldn’t have come at a better time than now when most Nigerians are stewed in penury and depravity in spite of the country’s huge earnings from oil and gas assets.

Falana had asked the corporation to disclose the revenue realised from the sale of the daily allocation of 445,000 barrels of crude oil from June 1, 2015 to December 31, 2017, the amount utilised as subsidy and the amount remitted to the federation account from revenue realised from the crude oil sales as well as the quantity of crude oil refined locally and the amount spent on turn-around-maintenance of local refineries (with vouchers) within the period.

But, the response of NNPC, the state owned corporation, which has over the years been criticised for its opaque operational policy as it has been the subject of various corrupt allegations, was, anything but satisfactory.

Specifically, the corporation said it is not mandatory by law to provide such information for two reasons. First, it claimed that it is not bound by the Freedom of Information Act, 2011, through which Falana made the request. And that even if it is bound by the act, the information sought is “expressly excluded from the purview of the act by virtue of section 15(1)(a)-(c).”

But some analysts have disagreed with NNPC, insisting that Nigerians deserve the rights to know how much the corporation spends on maintenance as it has both accountability and environmental implications.

Friday Ameh, energy analyst believes that Nigerians deserve to know the amount spent on yearly basis, as the action or inaction of government on the issue has caused untold hardship to some people particularly, the Niger Delta people through pipeline explosions.

Also, Ameh says that the public interest outweighs the corporation interest which is being funded by tax payers’ money. According to him, we reserve the rights to know whether our funds are being judiciously used and whether the corporation is making profits or losses, adding “its action presupposes that it is only accountable to the president whom he reports to. This is unfortunate and regrettable.”

When President Muhammadu Buhari took over power in 2015, he promised to fix Nigeria’s refineries and address all key issues in the oil industry, a development analysts believed, prompted the president to appoint himself oil minister.

But, three years down the line, the operations of the corporations are still shrowded in secrecy as well as the corporation bedeviled by allegations and counter allegations of flouting its own rules to corruption in high places.

Messers Falana & Falana Chambers had on January 8 and February 20 written an FOI request to the NNPC demanding details of revenue realised from the sales of the daily allocation of 445,000 barrels of crude oil between June 2015 and December 2017.

The legal firm also requested details of the amount utilised as subsidy and amount remitted to the Federation Account as revenue within the same period; the quantity of crude oil refined locally; the amount spent on Turn-Around Maintenance of local refineries; and the quantity of crude oil refined in Abidjan, Cote d’ivore, by the NNPC––– all between the period of June 2015 and December 2017.

Maikanti Baru’s Blow

But, the Nigerian National Petroleum Corporation has told a human rights lawyer, Mr . Femi Falana, SAN that it cannot provide information on the amount of money spent on petrol subsidy and turnaround maintenance of refineries.

The NNPC said this in a letter titled, ‘Re: Request for Information on Proposed Review of the Pump Price of Premium Motor Spirit’ dated March 1, 2018.

In a letter signed by the General Manager, Litigation, Arbitration and Property Law Development, Sarah Ndukwu, the corporation said the Freedom of Information Act which was evoked by Falana, did not apply in totality to the NNPC.

 

The letter read in part , “We regret to inform you that the NNPC is not in a position to provide any information or document as your request is incongruous with, unsupported by or outside the scope and purview of the Freedom of Information Act.

“Be informed that the FOI Act is not applicable to the NNPC because it is not a public institution within the meaning of Section 31 of FOIA.”

Quoting the section, the NNPC argued that the Act only refers to public institutions such as executive, legislative and judicial administrative or advisory bodies of government.

The statement added , “Be informed that even if the FOIA applies to the NNPC (which is strongly denied in view of Section 31 and recent judicial authorities) the information sought by your letter is expressly excluded from the purview of the Act by virtue of Section 151 ( 1 ) ( a) ( c) thereof.

“The requested information is in the nature of commercial, financial and trade secrets information which obviously are either subject to non -disclosure agreements or whose disclosure could reasonably interfere with NNPC ’s existing contractual obligations or harm third party interests .

“In fact, by the use of the word ‘shall’ in the section, NNPC is obligated in the absence of any prior consent by relevant third parties to deny your request.”

Mrs. Ndukwu cited two cases struck out by the court in December 2013 containing similar request.

“Be also informed that even if the FOIA applies to NNPC, (which is strongly denied in view of Section 31 and recent judicial authorities), the information sought in your letter is expressly excluded from the purview of the Act by virtue of Section 15(a)-(c) thereof,” the letter reads in part. “The requested information is in the nature of Commercial, Financial and Trade and Secrets information, which obviously are either subject to Non-Disclosure Agreement or whose disclosure could reasonably interfere with NNPC’s contractual or harm third party interest. In fact, by the use of the word ‘Shall’ in the Section, NNPC is obligated, in the absence of any prior consent by relevant third parties, to deny your request.”

“Be further informed that your request will not serve any public interest to public health, public safety or the protection of the environment as to bring it within the items exempted for disclosure under Section 15(4).”

The Holes

But a human rights activist, Barrister Femi Falana picked holes in NNPC statement that it is not a public institution and should not be subjected to FOIA. He said the corporation is a body created by a statute, the NNPC Act, and the Federal Government not only owns it wholly, it is funded and controlled by the Federal Government. Under Section 1(3) of the Constitution, if any statute is inconsistent with the provisions of the Constitution, the Constitution shall prevail.

He argued that Section 31(3) of the FOIA, which defines a public institution in ways inconsistent with constitutional provisions, is automatically deemed to be unconstitutional and therefore null and void in that respect.

According to him, by Section 85(3),(4) & (5) of the Constitution, the NNPC is a public institution over which the Auditor General is empowered to provide a list of auditors from which the NNPC shall appoint qualified auditors to audit the accounts of the NNPPC, provide guidelines on the levels of fees to be paid to the auditors, comment on the annual accounts of the NNPC, conduct periodic checks on the NNPC accounts and place reports before each House of the National Assembly which shall, in turn, cause the Committees on public accounts to consider such reports.

He added that by Section 88(1)(i) & (ii) of the Constitution, the NNPC is a public institution to the extent that the National Assembly is vested with the power to conduct investigations into the affairs of the NNPC as a body executing or administering laws  to be appropriated by the National Assembly.

On the claims by the NNPC that Federal Court verdict had held that the FOIA is not binding on the corporation because it is not a public institution as defined under section 31 of the FOIA, Aborishade  said the decision of the court should be appealed.

“The Presidential Committee Against Corruption would do well to encourage and support the body that initiated the two cases to appeal. Alternatively, or in conjunction with appealing the decisions of the FHC in the two cases, the National Assembly should also be put under pressure to amend the FOIA to ensure that the definition of a public institution under the Act conforms to constitutional provisions’’, he added.

On the claims  by the NNPC that Section 15(1)(a)-(c) of the FOIA excluded the categories of information from being disclosed for the sake of protecting trade secrets, Aborishade said the FOIA should urgently be amended to the effect of deleting this particular section 15(1)(a)-(c), which promotes corruption over transparency.

According to him, the desperation of the NNPC top hierarchy to waste the common patrimony buried in the NNPC over decades, is shown in the attempt to give the impression that Section 15(4) of the FOIA gives the NNPC some protection against public disclosure of information sought pursuant to the FOI Act. Nothing can be further from the truth.

He added that section 15(4) undermines section 15(1)(a)-(c), which exempts certain types of information from being disclosed. Indeed, section 15(4) of the FOIA is an exemption provision to section 15(1)(a)-(c) and permits disclosure, notwithstanding the provisions of section 15(1)(a)-(c).

‘’From the point of view of the aversion of ordinary people for corruption and their high expectation that corrupt public officials should be brought to book, which was the reason why the PMB-led APC was voted into power, I argue that it is in the public interest for the NNPC to disclose all the items of information sought by Mr. Femi Falana, SAN. Corruption has corrupted all aspects of the environment, naturally, socially and economically. Corruption has denied government of the necessary funds to revamp the health care system for the benefit of ordinary people. Corruption has contributed to monopolisation of public resources and subjected majority to a life of agony and misery to the extent of subjecting society to unprecedented state of insecurity.

“It is in the overriding public interest that corruption in NNPC is exposed as the Constitution empowers the National Assembly to carry out oversight functions, and conduct investigations into the affairs of public institutions, including corporations financed by government, “to expose corruption, inefficiency or waste” in public or statutory corporations “in the execution or administration of laws” made by the National Assembly (Section 88(2)(b), Constitution of the Federal Republic of Nigeria, 1999, as amended.

“It is in the public interest and in the interest of implementing the Constitution for the facts and documents demanded to be released by the NNPC, in accordance with Section 15(5), of the Constitution, which  prescribes that “the State shall abolish all corrupt practices and abuse of office”.

In the context of a recent publication by the NNPC that it spends N774m on a daily basis, amounting to about N24bn monthly, as subsidy on 50m litres of Premium Motor Spirit (PMS) allegedly consumed nationally, in spite of high levels of scarcity of fuel, it is not too much to ask the NNPC, as a public institution or statutory corporation to make public disclosures of its revenue, expenditures, subsidies, and so on.

Group Insists NNPC Is A Public Institution

Ridwan Sulaimon, Programme Manager, Freedom of Information, Media Rights Agenda, Lagos, told  Sunday INDEPENDENT that  Dr. Maikanti Baru is wrong to have  insisted that it is not a public institution.

“It is either he has not read the Act or he is just trying to be mischievous. Section 2 (7) of the FOI Act says: “Public institutions are all authorities whether executive, legislative or judicial agencies, ministries, and extra-ministerial departments of the government, together with all corporations established by law and all companies in which government has a controlling interest, and private companies utilising public funds, providing public services or performing public functions,” he added.

FOI’s Hall Of Shame ‘Trophy’

The MRA had July last year inducted the corporation in the FOI Hall of Shame because despite the huge resources at its disposal which would have enabled it to put in place the proper measures and structures for the effective implementation of the FOI Act, the NNPC has chosen to violate the provisions of the Act in every way possible.

In a statement in Lagos, MRA’s Executive Director, Mr. Edetaen Ojo, said: “It really should not be a surprise to anyone that the NNPC has become a cesspool of corruption over the years, having opted for a corporate policy of lack of transparency while resisting all attempts to hold it accountable to both the people of Nigeria and political authorities.”

According to MRA, “In the six years since the enactment of the FOI Act, the NNPC has not submitted any annual report to the Attorney-General of the Federation as required by Section 29(1) of the Act; it has persistently failed to comply with its proactive disclosure obligations under Section 2(3) and (4) of the Act; and has repeatedly refused to disclose information to requesters, opting instead to pay millions of naira in public funds to lawyers to implement its corporate strategy of  lack of transparency and accountability.”

MRA accused the NNPC of not only violating the provisions of the FOI Act, but also disregarding with impunity all the directives contained in the Guidelines for the Implementation of the FOI Act, issued by the Attorney-General of the Federation.

According to him, “it is difficult to understand how it is possible that even in the midst of a blistering war against corruption and despite the various audit reports which have detailed the NNPC’s sharp business practices, violation of regulations, illegal deductions of funds belonging to the Government, failure to account for several billions of naira that should have gone into the federation account and over-deducted funds in subsidy claims, which it has not been able to account for, not a single person in the NNPC has been punished or charged with any offence.”

Exemption Not Enough

A human rights activist and environmentalist, Nnimmo Bassey told  Sunday INDEPENDENT that  exemptions to disclosure does not apply where the interest of the public would be better served by having such record being made available.

“I know that the FOI Act has many exemptions, but the NNPC has to come clean on the subsidy payment issue. It is an issue of public critical interest and cannot be shrugged off by any officer, no matter how protected such an official or office may be.

“Considering the fact that it is the poor people living in the oil fields, and near refineries, who actually subsidise the cost of petroleum products by being recipients of unmitigated pollution, it is a show of a high mark of lack of responsibility for the NNPC to refuse to disclose what payments they are making on these matters.

No Room For Technicalities To Forestall Disclosure

To Chief Marin Onovo,a one-time presidential aspirant, the  FOI request is a good attempt to bring NNPC transactions to public scrutiny. He expressed that he was not surprised that the NNPC chooses to resist such an attempt and is defending its corrupt opaqueness.

“We must insist that the NNPC cannot hide under the technicality of the narrow definition of public institutions in the FOI Act. That narrow definition cannot override the constitutional definition of a public institution. The NNPC is not a private institution. So, it is a public institution.

“A democratic government must be transparent and accountable but the current government is clearly not and is promoting corruption with impunity. The NNPC, as a public institution must surrender its transactions to public scrutiny,” he added.

Non-Disclosure Bad Precedent To  Buhari’s Anti- Corruption Campaign.

There was a convergence of opinion among stakeholders that the refusal of the NNPC to give answers to the inquiries of Chief Femi Falana, is a justification that the corporation has something to hide from Nigerians.

Aborishade, posited  that the effrontery of the NNPC to declare that it is not a public institution that may be compelled to disclose its financial and other activities has helped to show the unprecedented political impunity to cover up likely large scale financial corruption that is perceived to be going on within the NNPC, which several probe panels by the National Assembly and past governments have established in terms of subsidy deals, diversion of products, fraudulent contract awards, scams involving Turn Around Maintenance (TAM) and so on.

The position of the NNPC on the request by Mr. Femi Falana, SAN has unfortunately confirmed Transparency International’s recent report that deeper levels of corruption are perceived to be occurring under the APC regime than ever before.

He said  rather than helping to change the perception of the PMB/APC regime as rotten, the NNPC position on whether or not FOIA binds it has further rubbished the image of the regime.

“At the minimum, the PMB/APC regime must take disciplinary actions within the NNPC to convince ordinary people that the letter by the NNPC to Mr. Femi Falana, SAN, does not officially enjoy the support of Aso Rock. Otherwise, ordinary people of Nigeria would be compelled to draw necessary conclusions and revalidate the negative public perception of the extent of rottenness of the PMB/APC regime as reported recently by Transparency International,” he added.

To Onovo, NNPC has not been transparent for many decades, adding that  the corporation  is under the complete control of the political leadership.

He said: “There is no anti-corruption drive under this government. What we have is an anti-corruption charade led by corrupt officials that failed the ‘Integrity test’. This charade is calculated to mislead the simple minded. This is the most corrupt regime since independence in 1960. $26 Billion NNPC contracts scam is the biggest contracts scam since independence’’.

There has not been any official reaction of the  government to the controversy surrounding the non- disclosure  of  the FOI request by Falana, fuelling speculations that with time the issue will fizzle out of the memory of Nigerians

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