DMO, oil marketers hold crucial meeting on refund

To clarify grey areas bordering on debt obligation to oil marketers by means of Promissory Note, Debt Management Office (DMO) has invited their representatives to a meeting in Abuja on Friday.

A statement issued by Debt Office said Friday’s meeting with the oil marketers would explicitly explain progress made, and provide status report to representatives of oil marketers.
The meeting is coming against fresh concern being raised in respect of uncleared arrears due to the oil marketers.

It stated that having secured approval by National Assembly in a letter dated 26th September, 2018 through Clerk of the National Assembly, it had initiated process for accelerated implementation of the programme in accordance with the provisions of Procurement Act.

Giving an insight into adoption of Promissory Note as convenient mode of settling local inherited local debts and contractual obligations due to various categories of creditors, including oil marketers in July 2017, the debt agency said the approval had the backings of the Federal Executive Council (FEC).

It said: “The FEC approved the establishment of the Promissory Note Programme and Bond Issuance to settle inherited local debts and contractual obligations due to various categories of creditors, including oil marketers in July 2017. These were unpaid obligations carried over from previous administrations. The amounts presented to FEC and subsequently to the National Assembly were derived by simply collating figures from various MDAs in order to kick-start the process.

“Given that these were largely unverified amounts, it became prudent on the part of government to include processes that would be adopted in the implementation of the programme that would ensure transparency and value for money before the Promissory Notes are issued. One of such processes is the validation of the amounts against each creditor by an international accounting firm operating in Nigeria.

“However, since the programme involves the issuance of sovereign debt instruments, which require the approval of National Assembly, as provided in the Fiscal Responsibility Act, 2007, there was a limit to what the DMO could do without a legislative approval.
“It is on record that the required National Assembly approval was only received on September 26, 2018 through a letter from the Clerk of the National Assembly. With the approval of National Assembly now in place, the DMO has accelerated implementation of the programme, which it will implement in accordance with the process approved by FEC.”

The refunds being sought by oil marketers were for accrued interest and foreign exchange differential.