Former Military President, Gen. Ibrahim Babangida, frittered away $12bn of the country’s revenue through special accounts, which he ran as the sole approving authority.
This was contained in the report of the Panel on the Reorganisation and Reforms of the Central Bank of Nigeria.
The panel headed by the late renowned economist, Dr. Pius Okigbo, painted in graphic details how Babangida operated “a second but undisclosed budget” with the then CBN governor, the late Alhaji Abdulkadir Ahmed.
The report, which was submitted to the administration of the late Gen. Sani Abacha on August 29, 1994, had been a subject of interest to Nigerians, who have been itching for the detailed report of the government’s White Paper on it.
According to the report, the Babangida regime operated dedication accounts outside of the budgetary provisions, which he ran without accounting to anybody. It stated that the operations of these accounts were fraught with irregularities.
“The proceeds of the sale of the crude were not shown in the revenue side nor were the expenditures reflected in the expenditure side of the budget,” the report said.
The report traced the origin of the accounts to September 1988 when Babangida approved a proposal to dedicate 65,000 barrels of crude oil per day for certain priority projects, particularly the Ajaokuta Steel, the Itakpe Iron Mining and the Shiroro Hydroelectric projects.
It added that the quantity was increased to 105,000bpd in October 1989 to finance such projects as the LNG and the commitment to the Joint Venture Partners of the Nigerian National Petroleum Corporation.
In the early part of 1994, it was again raised to 150,000bpd.
The report disclosed that the “total receipts and payments in respect of the dedication accounts from inception in September 1988 to June 30, 1994 were $6.195bn and $6.109bn respectively, leaving a balance of $85.943m as at the end of the period.”
Other controversial special accounts allegedly opened by the then military regime, according to the report, included the NNPC Sales of Mining Account, the Stabilisation Account, the Signature Bonus Account, and the GHQ Special Fund Account.
While the $2.06bn accrued to the NNPC Sales of Mining Rights Account, through the sale of mining rights in the NNPC/ Shell Joint venture, $4.398bn accrued to the Stabilisation Account between October 1990 and June, 1994.
As the report explained, the Stabilisation Account was created in October 1990 to receive revenue from crude oil sales in excess of the budgeted provision during the Gulf War.
The aim, it added, was to effectively separate it from the Federation Account and to sterilise it pending instructions for further utilisation.
It reported that the bulk of the money was applied to settle obligations outstanding to contractors handling priority projects and in financing the debt buy-back operation.
The report further disclosed that in 1992 $1.21bn, representing the proceeds of debt held by the CBN was received back into the account, but the balance in that account as June 30, 1994 was $117.36m. There was no account of the disbursements from that account.
The report added that as the funds swelled, other revenue streams, including the proceeds from the sale of mining rights, stabilisation account, and signature bonus, were also squandered.
The Babangida regime, it said, also resorted to the financing of mundane projects like the purchase of television and video sets for the Presidency at the cost of $18.30m, documentary film on Nigeria, $2.92m, foreign trips by wife of the President, $8.95m, and medical clinic for Aso Rock, $27.25m, among others.
It said, “Neither the Dedication Account nor the Stabilisation Account was applied for the .purpose it was originally designed to serve.
“Thus, the Dedication Account was used for many non-priority projects and the Stabilisation Account was not, in practice, used to sterilise revenues in excess of projected earnings.
“Instead, after a short delay, the monies in the accounts were spent virtually as fast as they were accumulated.”
On the external sector of the economy, the report insisted that there was nothing to cheer about the various economic policies employed by the Babangida administration in the reviewed period.
“It noted that in spite of the various policy measures put in place since 1986 to reverse the deteriorating trend in the external sector of the economy, the results were unsatisfactory.
“The noticeable favourable performance in the balance of payments in the first year of the implementation of the Structural Adjustment Programme, 1986-1988, was artificial as some debt service claims against the country were postponed due to debt rescheduling.”
It argued that the improvement could have been sustained but for the usually high level of other external payments and expenditures from 1989 onwards, which wiped out the external reserves and put extreme pressures on the balance of payments.
It noted that the external sector performance deteriorated in 1992 as the overall balance of payments position, which was persistently in surplus during the previous three years, plunged into huge deficit of $3.8bn.
This, according to the report, reflected the large payments made in respect of scheduled amortisation, as well as the debt buy-back arrangement, which led to the repurchase of $3.4bn worth of the country’s external debt.
Other members of the panel were the incumbent Chairman, First Bank of Nigeria Plc, Alhaji Umaru Mutallab; the current Chairman of Diamond Bank, Mr. Paschal Dozie; Mr. Y. Sankey; and Mrs. B. Latinwo. Others were the current Secretary to the Government of the Federation, Chief Ufot Ekaette; Mr. O. Oyefodunrin; and Ida, who was the secretary.
Efforts to find out the present state of the various accounts listed in the report from the CBN met a brick wall.
The bank’s Head of Corporate Affairs, Mr. Festus Odoko, said in a telephone interview on Monday that he could not say much on the issue since the Federal Government had not released the report to the public.
When pressed further, the CBN spokesman who requested for a copy of the report, dismissed the claims that certain spurious accounts were managed by the CBN.
“I do not know anywhere in the world where CBN opens account for individuals. There are accounts for banks and government,” Odoko said.
In an interview with THISDAY on Sunday, on August 20, 2006, Babangida said he had anticipated the oil windfall as one of the major political issues against his presidential aspiration in 2007.
He, however, added that he was prepared to defend the management of the $12.4bn.
He said, “I prepared my mind. I knew what everybody will be talking about. Now, they have added Vatsa into the vocabulary of the atrocities committed by IBB.
“So, it’s Vatsa, the N12.4bn oil windfall they say I stole; Dele Giwa; June 12 and the institutionalisation of corruption. I hope Nigerians will believe (and I believe they will) when we eventually tell them the truth.
“I said for my eight years, I have never been so fortunate to get a barrel of crude oil above $30. I was that unfortunate to manage a situation where a barrel sold for $12, $10 per barrel during my regime. On one side, you had me who managed poverty, on the other side, you had others who are managing affluence.”
The Coordinator, International Press Centre, Lagos, Mr. Lanre Arogundade, on Monday said the failure by the government to make the report public and issue a White Paper on it raised a major question mark on the genuineness of its anti-corruption war.
Also, the Executive Director, Media Rights Agenda, Mr. Edaetan Ojo, said he was surprised by the government’s lack of commitment to get to the root of the case despite the amount of money involved and its anti-corruption stance.
They spoke on Monday in separate interviews with our correspondents.
While commending THE PUNCH for its efforts at putting the report in the public domain, Ojo said his organisation would take the issue up once it had the necessary tools.
Despite the fact that THE PUNCH had it on good authority that a copy of the report had been with Ida, past attempts to get it were unsuccessful.
On October 13, 2004, THE PUNCH wrote Ekaette, asking for the government’s intervention to obtain the report.
But the letter was not replied.
A reminder, signed by the Editor, THE PUNCH, Mr. Azubuike Ishiekwene, was sent to the SGF on October 27.
The SGF, whose office statutorily keeps all reports of panels or commissions of inquiry, sent a terse response on November 12, 2004.
In the response, signed by Dr. K.B. Kaigama on behalf of the SGF, the government said it would be willing to make the Okigbo Report available as soon as it could be found.
Still unrelenting, THE PUNCH, on April 11, 2005, wrote a letter to the chairman of the defunct National Political Reform Conference, Justice Niki Tobi, urging the conference to prevail on the government to release the reports of both the Okigbo Panel and the Human Rights Violations and Investigations Commission to the public.
The NPRC did not address the issues bordering on the Okigbo Report.
Having obtained a copy of the report, THE PUNCH on August 10, 2006, wrote another letter to the SGF to verify its authenticity and enclosed the 352-page report.
Extracts from the letter read, “You may recall, Sir, that on October 13 and 27, 2004, PUNCH wrote two separate letters to the SGF requesting for copies of the Okigbo panel report, which among other things, investigated how the military administration of General Ibrahim Babangida disbursed the $12.4bn earned from the sale of oil during the first Gulf War in 1990/1991.
“PUNCH was also encouraged to write because the present administration had indicated quite clearly, both in public comments by President Olusegun Obasanjo and specifically in a reply to our enquiries in a letter received on Friday, November 12, 2004 (signed by Dr. K.B. Kaigama on behalf of the SGF), that it would be willing to make the Okigbo report available as soon as it can be found.
“In fact, we recall that as part of the government’s effort to address our request, Kaigama said in his letter that the SGF’s office had written one Alhaji Ibrahim Ida, a member of the panel, for a copy of the report and that his response was being awaited.
“After years of diligent search, PUNCH has obtained what could be a genuine copy of the Okigbo report. We would be most obliged if the SGF, who on page VI of the report is indicated as one of the eight members of the panel, and a signatory, could assist PUNCH in verifying the authenticity of this volume in the overriding interest of the public.”
As at press time on Monday, there was no response or acknowledgement from the government.
Also Read: Quotes from the Okigbo Report
