The Senate Joint Committees on Finance, National Planning, Gas Resources, Petroleum Upstream and Downstream on Friday summoned the Minister of Mines and Steel Development, Olamilekan Adegbite, over poor regulation and loss of revenue in the sector.
This is even as the Joint Committees fixed N15 billion as target revenue for Nigeria Mining Cadastre Office in 2022 as against N4 billion proposed by the agency.
The Senate invitation to the Minister was a sequel to the failure of the Director-General of the NMCO, Engr. Obadiah Nkom, to furnish the committee with required explanations on low revenues being generated in the sector and the menace of illegal mining across the country.
Obadiah had informed the joint committees that in 2019, N2.58 billion was generated and remitted to the Consolidated Revenue Fund, which reduced to N2.3billion in 2020 due to the COVID-19 pandemic, but already increasing in 2021 with N3.166 billion realised as at July out of the targeted N4 billion.
But the Chairman of the Committee, Senator Adeola Olamilekan, and other members of the Committee wondered why such an agency could not generate revenue beyond the threshold of N4 billion to N5 billion.
The Chairman said: “Your submissions on revenue generation is low and not impressive at all because big companies like Dangote Cement, BUA, etc with combined yearly profits of about N5 trillion are under your purview.
“These are aside other companies carrying out illegal mining activities across the country that are not captured in your revenue generation.
“A lot of Chinese are involved in illegal mining in the country without your agency or any other one saddled with the regulation of the sector doing anything as far as licensing them and monitoring their explorations in form of a collection of royalties are concerned.”
However, the Director-General in his response said the mandate of his office is just for licensing of firms and not a collection of royalties or monitoring of illegal miners or mining.
He said: “Our revenue is strictly generated from licensing and annual service fees collected from firms.
“Royalties and illegal mining are not under my purview and I cannot dabble into them.”
Angered by his submission, Adeola, in agreement with the members, ordered the Clerk of the committee to summon the Minister of Mines and Steel Development for the required interface on way out of the problem in the sector, particularly as regards illegal mining and low revenue generation.
He said: “The Minister will have to appear before this committee for the required interface on way out of the problem in the sector.
“As for the Mining Cadastre Office, N15 billion is now fixed as targeted revenue generation for the year 2022 because you have the capacity of meeting up with that as against N4 billion or N5 billion you are proposing.”
Adeola added that in stopping the yearly budget of the country from being funded by borrowings, the Finance Act will be amended to make agencies fully funded by the government to remit 100 per cent of their revenues into the Consolidated Revenue Fund and those partly funded 80 per cent of their operational surpluses.
The Joint Committees also threatened zero budget allocation in the 2022 fiscal year for any revenue-generating agencies without a clear cut revenue profile or targets.