The suspension of the petrol subsidy and the adoption of price modulation regime from January have fetched N2.6 billion into a Federal Government special account in the Central Bank of Nigeria (CBN).

The former Executive Secretary, Petroleum Products Pricing Regulatory Agency (PPPRA), Farouk Ahmed, who spoke during his handover in Abuja to the General Manager, Administration and Human Resources, Moses, Mbaba, said the government is now in the regime of ‘over-recovery’.

Ahmed said: “As at the 12th February, 2016, because we verify based on what was imported, about N2.6billion has accrued to that account. The fund is still low because most of the cargoes arrived in December last year. AThe PPPRA has already communicated to the appropriate authorities that we are in the regime of over-recovery.”

He said the delay in handing over was informed by the need to compile a comprehensive handover note for his successor in view of the price modulation regime that is still at its infancy stage.

Ahmed said price modulation regime has instilled efficiency in the system, noting that there are possibilities that the pump price of petrol will crash further in the second quarter going by the trend.

He said: “Indeed as at Tuesday close of market, the subsidy on petrol was N13.81Kobo over-recovery. The PPPRA would now send a debit note to every marketer that falls within that bracket to refund the money to government.

“There is already an account with the Central Bank of Nigeria (CBN), which is managed by the Accountant-General of the Federation where all over-recovered funds are deposited. So, there is no question about where does the money from over-recovery goes into.”

He explained that all the money that goes into the over-recovery account will also be used to pay for the subsidy when the price of crude oil soars in the international market.

Ahmed hinted that the PPPRA would on the 15th of March begin to collate data on the trends in the industry between January and March to determine the components of the template for the second quarter.
Source: The Nation