N800 bn subsidy: no deal with FG, says marketers, suspend staff across depots

Therefore,   as   from   today,   our   work   force,   save   for   security   operatives,   will effective, 7th December 2018 cease to be on our payroll pending payment of the debt owed by the Federal Government

Admin l Saturday, Dec. 08, 2018

LAGOS, Nigeria – Depots and Petroleum Products  Marketers Association of Nigeria (DAPPMA) on Saturday refuted reaching an agreement with the Federal Ministry of Finance on the payment of the N800 billion subsidy arrears. The marketers in a statement signed by Executive Secretary, Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), Mr Olufemi Adewole, stated that there was no agreement, stressing that what the Ministry of Finance offered failed in all ramifications to meet its legitimate demands.

“We refer to the press release from the Federal Ministry of Finance on Dec. 6 following the meeting with marketers under the aegis of Major Oil Marketers Association of Nigeria (MOMAN), and DAPPMA, and Independent Petroleum Marketers Association of Nigeria (IPMAN), wherein the minister said the marketers had agreed to resume operations. We did not signed the purported document with government as claimed. We still stand by our utimatum”, he insisted.

He also said that with the development, the 7-days ultimatum still stands, adding that the marketers could not continue to borrow money to pay staff salaries. It would be recalled that the oil marketers on December 2nd gave the Federal Government 7-day ultimatum to settle outstanding N800 billion subsidy payment debts. They said failure of the Federal Government to make payment of the arrears would lead to depots ceasing operations across the country.

Also  the Federal Ministry of Finance, on December 6, said that the Federal Government and petroleum marketers had agreed on the settlement of outstanding claims. The ministry in a statement issued by Mr Paul Abechi, Special Assistant on Media and Communications to the Minister of Finance, Mrs Zainab Ahmed, in Abuja assured that operations at all depots and sales would continue until further notice.

Abechi had said the agreement was contained in a statement jointly signed by officials of the Federal Government and representatives of the petroleum marketers after a joint meeting. According to him, the petroleum marketers expressed satisfaction over the arrangement being made by the Federal Government to settle their claims and assured the members of the public of availability of petroleum products.

And that the meeting was held at the Ministry of Finance in Abuja and that it had in attendance senior government officials from the Ministry of Finance, the Debt Management Office (DMO), the Nigerian National Petroleum Corporation (NNPC) and the Central Bank of Nigeria (CBN). However, the oil marketers said: “We   refer   to   the   press   release   from   the   Federal   Ministry   of   Finance   following   the meeting with marketers under the aegis of DAPPMAN, MOMAN and IPMAN and most respectfully refute its contents with the following clarifications.

“DAPPMAN reiterates that there was no agreement reached because offers by government failed to meet the legitimate demands of the association and we did not   sign  the   purported   document.

“Hence,   our   ultimatum   stands   as   we   cannot continue to borrow from banks to pay staff salaries. DAPPMAN’s demands made to the FG through the Honourable Minister of Finance and Debt Management Office was to pay in cash the   total   sum   of   indebtedness   to   marketers   within   the   time frame. This was expressed   in   communications   with   the government , Ministry   and   other relevant office.”

According to the marketers, this is to enable them   continue   in   business;   pay  staff   and   not   rely   on   facilities   from banks which are no longer forthcoming. They also said that in the past three years, DAPPMAN had highlighted the adverse impact those sovereign debts forced on marketers due to Federal government’s inability to comply with the terms of marketers agreement with PPPRA for its Petroleum Support Fund(PSF)scheme and the devaluation of the naira.

“We   affirm   that   of   all   stakeholders,   MOMAN,   IPMAN   and   DAPPMAN   that participated in the PSF scheme, DAPPMAN has the  largest debt exposure in the downstream sector.  DAPPMAN has alerted the FG to this dire situation and specifically to the challenge our member companies face, leading to our inability to pay December 2018 salaries to our teeming work force without the immediate settlement of the debts owed by the FG.  Most unfortunately, this has not been heeded. Since government globally is recognised as a continuum, FG is obliged to settle   all   legitimately   incurred   and   verified   Sovereign   debts   due   to   marketers promptly,” they said.

The marketers  stressed   that   those   debts   owed   them  actually   belong   to banks, their shareholders, depositors and other Federal Government Agencies such as PPPRA, PEF-M-B, AMCON. The marketers said banks, in compliance with extant banking regulations of the CBN, recently swooped on marketers  with  non-performing loans;   taken over     their depots  and also  had cut   off  any   form  of   trading  loans to   them. 

 “As  a  result, thousands of families have lost their means of livelihood. Many more marketers will follow suit in the event that FG does not settle these debts to marketers. We   recall  events   of   2017;   approvals   obtained   when   the   then   Ag.   President, Prof. Yemi Osinbajo in June, 2017 promised that payment would commence by 31st July, 2017.  We also recall several follow up meetings anchored by the Chief   of   Staff   to   the   President   on   the   same   issue   and   when   nothing   was forthcoming from the FG, we were forced to issue an ultimatum to lay-off staff on the 25th of December, 2017. 

“Unfortunately based on the FG, failed promises to address   the  sovereign   debt   which   was   then   less   than  N350 billion,   it     has grown to over N800 billion and still Federal has yet to pay. December 2018 makes it 18 months after FEC  approval for this payment  and three months after the National Assembly (NASS) approval, yet marketers have not been paid. We   emphasise   that   FG’s   proposed   payment   of   promissory   notes   is   not acceptable to DAPPMAN. We  not accept anything than cash

“This will adversely affect the financial system taking due cognisance of the futuristic nature of this proposed mode of financial transaction.Therefore,   as   from   today,   our   work   force,   save   for   security   operatives,   will effective, 7th December 2018 cease to be on our payroll pending payment of the debt owed by the Federal Government,” they said.