DEEPENING DEMOCRACY: A cavalier ruling class

The legislature has oversight functions of ensuring that public resources are used uniquely for the public good, and yet, today the Chair of the Senate Power Committee, Nicholas Ugbane and his counterpart in the House of Representatives,

Ndudi Elumelu and some of their members are facing charges from the Economic and Financial Crimes Commission, EFCC over a 5.2 billion Naira fraud.

At the same time, the EFCC has charged the Chairman of the National Electricity Regulatory Commission, Ransome Owan and his six commissioners representing the masses of people in the six-geopolitical zones of the country desperately seeking electricity, for taking and sharing 3 billion Naira of the authority's funds. And yet, these commissioners were appointed to protect the public interest. Any wonder that electricity supply has become a mirage in this country?

In Nigeria, 2% of automotive levy is given to the National Automotive Council as resource for research and development of the Nigerian car. Recent press reports indicated that successive ministers have illegally shared out, stolen or misdirected 10 billion Naira from the fund. In the National Sugar Development Council, the same thing happened to 5billion Naira.

Bode George, former Chairman of the National Ports Authority and some of his executives have recently been jailed for misappropriating the Authority's resources. These reports show a massive failure of governance at the level of the highest pinnacle of the power elite. Those who have responsibility for oversight and monitoring of public institutions for the public good are guilty of stealing the resources of the institutions they have sworn to protect.

What does a president committed to the rule of law do when his appointees turn round to loot the institutions they are supposed to protect and develop? Who can dare tell the president the truth when "his appointees" have a vested interest to lie and cover up because they have stolen? These are the challenges of governance in Nigeria that a president can be helpless in addressing simply because very few people can report to him truthfully.

In the country as a whole, even the main source of our national revenue, petroleum is poorly regulated and our ruling class does not show enough enlightened self interest to protect the source of the funds it loots. On the 4th of November, the Civil Society Legislative Advocacy Centre and the National Extractive Industry Transparency Initiative (NEITI) held a briefing session for the National Assembly on the sector.

Haruna Sa'ed, the executive secretary of NEITI revealed that we do not even have a mechanism to measure oil production at the wellhead. We depend on terminal receipts given by oil companies to estimate the production levels of our petroleum. This means we have no way of estimating the massive amount of petroleum stolen or diverted between the oil wells and the export depots. How can a ruling class be so cavalier about the source and amount of the resources it fights so hard to spend?

The 2005 audit of the oil industry revealed that it is difficult to ascertain the volumetric data emanating from the industry. Although the estimate for total production for 2005 was 917.7 million barrels, giving a daily production average of 2-5 million barrels, the message is that we are not very sure. The evidence however points to larger figures as we have enough indications about diversion of oil.

The audit also revealed that NNPC owed the Federation $4.7 billion which it simply decided to sit on. We are told further that total financial reports from oil in 2005 were $37.871 billion and 19.7 billion naira. However, as there were numerous inconsistencies between the various sources, the figure is questionable.

For example, in terms of petroleum profit tax, there was a difference $241 million dollars between the figures given by the Central Bank and the oil companies respectively. There was an even bigger difference between the figures for royalties - $322 million between the figures given by the two institutions.

As Auwal Musa Rafsanjani, the convenor of the meeting argued, the NEITI process is a very significant governance tool because in the past, we only depended on rumours to speculate on the looting of our oil resources by regulatory agencies. Today, we are beginning to have facts and figures, even if not wholly accurate, that can assist in arresting the tide of looting and gradually improving the efficacy and above all, the integrity of our regulatory mechanisms.

Next week, we shall continue along this theme by proposing the establishment of an espionage directorate to enable the president monitor and evaluate how his appointees in regulatory authorities are looting and ruining our institutions and resources.