FAAC: States ratify removal of oil subsidy

The Federation Account Allocation Committee (FAAC) in Abuja on Tuesday took a decision to remove petroleum subsidy in the country.

The Chairman of Finance Commissioners Forum, Mr Timothy Odah, said this when he briefed newsmen on the outcome of the FAAC meeting for the month of March in Abuja.

Odah said at their last meeting, a committee consisting of six Accountants-General of states and six state Commissioners for Finance was set up to conduct investigations and present a report on the impact of the subsidy in the country so far.

“FAAC in its plenary session finally took a decision that petroleum subsidy should be entirely removed.

“Because from what was discovered, the subsidy is more or less a solution worse than the problem it is meant to solve.

“Therefore, we are of the firm decision that it will be better for states to access their funds and grant subsidy in their respective capacity.

“Our position will be submitted to the Presidency,’’ he said.

Odah cautioned organised labour to be careful in its refusal to rally for the removal of the oil subsidy programme.

He alleged that that most of them were against the removal because they were on the payroll of oil marketers in the country.

The Accountant-General of the Federation (AGF), Mr Jonah Otunla, said N641.4 billion was shared among the Federal Government, states and local governments as revenue for the month of March.

“The distributable statutory revenue for the month is N534.91billion, which is more than the N531.33 billion that was shared for the month of February .

“Also distributed is the sum of N7.62 billion refunded by the NNPC to be shared to states and local governments.

“In addition, the sum of N35.55 billion is proposed for distribution under the SURE-P programme.

“So, the total revenue distributable for the current month, including Value Added Tax (VAT) of N63.31 billion is N641.38 billion,’’ he said.

A breakdown of the distribution showed that the Federal Government received N249.1 billion representing 52.7 per cent; states, N126.34 billion, representing 26.7 per cent, while local governments received N97.4 billion, amounting to 20.6 per cent.

Otunla added that N57.3 billion, representing 13 per cent derivation revenue was shared among the oil producing states.

On VAT, he said that the gross revenue collected in March was N63.31 billion as against N66.8 billion distributed in February, representing a decrease of N3.49 billion.

He said that the mineral revenue collected for March was N519.99 billion, less than the N569.14 billion realised in February making a difference of N49.15 billion.

The AGF said that non-mineral revenue collected during the period under review was N94.37 billion.

The figure, he said, showed reduction of N3.24billion from the N97.61 billion that was collected in February.

Otunla said that N79.45 billion was transferred to the nation’s Excess Crude Account.

He said that oil revenue for March had declined compared to the previous month.

Otunla attributed the decline to production shut-in at Qua Iboe Terminal, shut down of Forcados and oil theft and some repair works on pipeline leaks at Bonny and Brass Terminals.

On other matters, Otunla said the work plan for the implementation of the International Public Sector Accounting Standards (IPSAS) in government agencies was discussed.(NAN)