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Oil price rises to $85, three-month high 

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Oil price on Wednesday rose to $85 a barrel for the first time in three months.

Brent crude futures, the global benchmark, rose 1.66% to $85.11 a barrel by 19.06 GMT+1, while West Texas Intermediate (WTI) crude futures increased 2.25 percent to $83.05 a barrel.

The price of Brent crude had crossed the $85 mark on October 15, 2021.

Last week, the Organisation of Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, decided to increase oil output by 400,000 barrels per day.

Morgan Stanley, a multinational investment bank, had predicted that Brent crude would climb $90 a barrel in the third quarter of this year.

The bank added that it expected oil prices to “overshoot” to $125 a barrel this year and $150 in 2023.

In the 2022 budget, President Muhammadu Buhari earmarked $62 per barrel as the oil benchmark, up from the $57 per barrel in 2021.

Rising oil prices would translate to an increase in Nigeria’s oil revenue.

Nigeria has however been ploughing its oil revenue into fuel subsidy shortfall payments, which stripped the country of more than N1 trillion last year.

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How to use your pensions for mortgage

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The National Pension Commission recently approved the guidelines to access Retirement Savings Account balance for payment of equity contribution for residential mortgage by RSA holders.

The approval was in line with Section 89 (2) of the Pension Reform Act 2014, which allows RSA holders to use a portion of their RSA balance towards payment of equity for residential mortgage.

PenCom however specified conditions to access the funds. A major condition is that the applicant must be in active employment, either as a salaried employee or as a self-employed person.

It stated that application for equity contribution for residential mortgage must be in person and not by proxy.

How to apply

Anybody who is interested can approach his PFA to get explanation on the process. The PFA will print the statement of account and determine the 25 per cent.

Speaking with our correspondent, the Spokesperson, PenCom, Abdulqadir Dahiru, said, “Then when you have that, you can now go back to your mortgage lender, get a letter of offer of your property, go through their own due diligence to agree for them to finance because the pension is only giving you 25 per cent; 75 per cent will still be financed by somebody.

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“That person must give you an offer letter for a loan that he is ready to finance you, and this is the equity contribution you are required to bring. So if you have that equity contribution with that letter of offer, which has been validated by the mortgage lender, that is when you can approach your PFA to request for your 25 per cent.”

Maximum amount allowed

PenCom stated that the maximum amount to be withdrawn is 25 per cent of the total mandatory RSA balance as of the date of application, irrespective of the value of equity contribution required by the mortgage lender.

Where 25 per cent of a contributor’s RSA balance is not sufficient for payment as equity contribution, the RSA holders may utilise the contingency portion of their voluntary contributions (if any).

Consent form

If a person had accessed part of the funds before either for leaving paid employment before retirement age, he will still get lump sum at retirement. He can still get part of the funds for mortgage after meeting specific conditions stated in the guidelines, but he must sign a consent form to get it.

Aisha Dahir-Umar, DG National Pension Commission

Dahiru said, “If you have taken 25 per cent for temporary loss of job and then you get employment again, and you continue contributing and you come to collect for a mortgage, you will sign a consent to say that I’m fully aware that this money I want to withdraw to finance a house will affect the amount I may likely take when I retire, I understand and whatever.

“So, basically you are indemnifying the PFA that you understand so that at the point of retirement, if your benefit is lower compared to your colleagues you will not complain.”

Mortgage lender

To qualify as a mortgage lender for the purpose, the company must be licensed by the Central Bank of Nigeria, comply with the Contributory Pension Scheme and have valid Pension Clearance Certificate, according to PenCom’s guidelines.

Eligibility

According to PenCom, a worker must have an offer letter for the property duly signed by the property owner and verified by the mortgage lender. The RSA of the applicant must have both employer and employee’s mandatory contributions for a cumulative minimum period of 60 months (five years). A contributor under the Micro Pension Plan is also eligible, provided he/she has made contributions for at least 60 months (five years) prior to the date of his/her application.

Age limit

RSA holders that have less than three years to retirement are not eligible.

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Dahiru explained, “If I am an employee and working in an organisation where the retirement age is 55 years, if I am 50, or 51 years, I can access because I have five years or more than three years to retire. But once I get to 52 that, means I have three years which I cannot access.”

According to PenCom’s guidelines, married couples, who are RSA holders, are eligible to make a joint application, subject to individually satisfying the eligibility requirements.

Data recapturing

RSA holders, if registered before 1 July 2019, must have their records updated through the RSA data recapture exercise.

Dahiru said, “But it’s very important that RSA holders have done their recapture. When you have not done your data recapturing, we can’t process it.”

Insufficient 25 per cent contribution

The PenCom spokesperson said, “Where the 25 per cent the mortgage lender is asking for is equal to the 25 per cent of your RSA, definitely we will process. But if what mortgage lender is asking for is higher than what you can get from your PFA, you will have to look for the difference and pay and show evidence to your PFA.

“For instance, if your mortgage lender is looking for N2.5m and the mortgage is N10m, and the mortgage lender says bring 25 per cent as equity contribution, and your own 25 per cent in your RSA is only N1.5m, you will have to look for that difference of N1m and pay; then come with it with your offer letter for the property and the evidence that I have paid, then your PFA will give you the balance of N1.5m which is your 25 per cent.”

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NNPC denies operating secret account, says fuel subsidy gulps N2.6tn

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The Nigerian National Petroleum Company Limited (NNPCL) has not remitted any amount to the federation account since the beginning of this year as the company’s deduction for petrol subsidy rose to N2.565 trillion at the end of August 2022.

A new report by the NNPC revealed this even as the company denied any involvement in the operation of any secret bank account, stating that the Office of the Accountant General of the Federation (OAGF) was aware of its financial transactions.

An analysis of NNPC’s monthly presentation to the Federation Account Allocation Committee (FAAC) at the weekend, further showed that the NNPCL has so far spent N2.565 trillion on the controversial subsidy this year.

Information from the FAAC meeting had earlier revealed that the money available for distribution among the three tiers of government for the month slumped by N280.948 billion to N673.137 billion when put aside the N954.085 shared in July.

Of the amount, the Federal Government received N259.641 billion; the states received N222.949 billion, while the local governments got N164.247 billion.

“The sum of N525,714,373,874.60 being federation account share was used to defray value shortfall/subsidy for the month,” the NNPCL stated in a document quoted by TheCable.

According to the national oil firm, in January, February, March, and April 2022, the petrol subsidy gulped N210.38 billion, N219.78 billion, N245.77 billion and N271.13 billion respectively.

Furthermore, in May, June, and July, the country spent N327.07 billion, N319.18 billion and N448.78 billion respectively before the hugest deduction of N525.71 billion in the latest instance.

The NNPCL also on Saturday said it was not involved in the operation of any secret bank account.

It said that the Office of the Accountant General of the Federation (OAGF) was aware of its financial transactions.

In a thread on its verified Twitter handle last night, signed by the spokesman for the national oil company, Mr Garba Muhammad, the company explained that it was unaware of the existence of any such account.

The House of Representatives a few days ago said it was probing the structure and accountability of the joint venture businesses and Production Sharing Contracts (PSCs) of the NNPCL in the last 32 years.

The lawmakers had alleged that they had uncovered a secret account owned by the NNPCL allegedly in breach of due process.

The report stated that an official of the OAGF, Mr Chize Peters, disclosed to the Abubakar Fulata-led Adhoc committee probing the matter.

The committee was said to have directed the Group Chief Executive Officer of the NNPCL, Mele Kyari, to appear before it to offer explanations on the issue.

But in a series of tweets, the spokesman of NNPCL said, “The NNPCL, directly or through its upstream arm, the National Petroleum Investment Management Services (NAPIMS), does not operate secret accounts at all.

“The joint venture cash call accounts denominated in US Dollars and Nigerian Naira are all domiciled with the Central Bank of Nigeria in line with the Treasury Single Account (TSA) policy.

“The Joint Venture Cash Call (JVCC) NGN and USD accounts were created to cater for the funding of cash calls for the various Joint Ventures managed by NNPCL on behalf of the Federal Government,” the company said.

The statement added that the ‘Joint Venture Proceeds Accounts’ were opened for the individual JVs to implement the self-funding strategy which aims at making them be self-reliant.

“The Office of the Accountant-Gen. of the Federation (OAGF) is fully aware of the JVCC accounts as the OAGF regularly sanctions & approves the updates/change of signatories to the accounts.

The NNPCL has documents where these correspondences with the OAGF were acknowledged.

“The NNPC/NAPIMS books of accounts in respect of the federations upstream petroleum activities are audited annually by independent external auditors,” the national oil company said.

According to the NNPCL, a critical part of the independent statutory audit is sending ‘circularisation’ to banks to confirm balances and bank accounts belonging to NNPC/NAPIMS.

It stressed that Audited Financial Statements (AFS) are submitted to all stakeholders including the National Assembly.

In addition, the company stated that the OAGF conducts periodic (yearly) checks on the activities of NNPC/NAPIMS, maintaining that the activities of the NNPCL and NAPIMS are audited yearly by the Nigerian Extractive Industry Transparency Initiative (NEITI).

“NNPCL has documented evidence of the correspondences between the company and the OAGF before the accounts were opened with the @cenbank, in line with the Treasury Single Account (TSA) policy.

“We also have evidence of reconciliations carried out with the @cenbank for the year ended 31-12-2021 in respect to the JV Cash Call Accounts.

“Thus, with such multiple layers of checks and balances, it is impossible for @nnpclimited to operate secret accounts until the ad hoc Committee, with due respect to its competencies, discovers it.

“If such ‘secret account’ does exist, then @nnpclimited certainly is not aware of, and has absolutely nothing to do with it,” the statement concluded.

 

 

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Nigerian Electricity Workers, NUEE Threaten To Shut Down National Grid

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The workers had on August 12, 2022, shut down the national grid to draw the government’s attention to their plight.

The National Union of Electricity Employees (NUEE) has threatened to shut down the national grid again, if the federal government fails to meet their demands.

The Zonal organising secretary, North West NUEE, Comrade Dukat Ayuba, in a press conference in Abuja on Friday said the two weeks given to resolve the crisis had elapsed.

He said although negotiations were still on going, the shutting down of the national grid could go on.

The workers had on August 12, 2022, shut down the national grid to draw the government’s attention to their plight.

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Ayuba lamented that the so-called privatisation of the sector was a scam because nine years after the taking over by investors, nothing had changed.

“That was why, we kicked against privatising the distribution sector because, the investors don‘t have the capacity and expertise. As committed Nigerians we advised the government against it. But the government was hell bent on doing so.

“The investors are still operating with obsolete equipment dating back to 35, 40, and 50 years. One will expect that with the coming of the investors they will replaced these obsolete equipment but nothing has been done.”

According to the union leader, the nation still generates 5,000 megawatts of electricity, saying, “This is the same 5,000 megawatts we used to generate. So, what is the benefit of privatisation? We now generate megawatts with higher tariffs, bringing hardship to the homes of millions of Nigerians. This will only happen in Nigeria,” he stressed.

Also, a member of Central Executive Committee, Wisdom Nwachukwu, said the federal government was plotting to sell off the Transmission Company of Nigeria (TCN).

“They are going behind meeting with some stakeholders. We are watching them. We will not allow that. We are patriotic Nigerians who want the best for our country.”

The Vice President, North West, NUEE Ado Gaya revealed that the 16 months demanded by the electricity workers is their legitimate earnings which involve 55,000 workers.

However, he said nine years after, the workers had not received a dime, saying, many of the workers have died, while those who were laid off were suffering with their families and passing through very difficult times.

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