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ECA drops to $2.45bn as FG, states share N580bn

By on January 18, 2015

The Excess Crude Account has been further depleted by about $650m from the $3.1bn in December to $2.45bn as of January 16, figures obtained from the Federation Account Allocation Committee has revealed.

The Minister of State for Finance, Amb. Bashir Yuguda, gave the figure while addressing journalists at the end of this month’s FAAC meeting in Abuja

Also at the meeting, the committee shared the sum of N580.37bn among the three tiers of government as allocation for the month of December.

The December allocation of N580.37bn is N108.56bn lower than the budgeted amount of N688.93bn and N12.85bn less than the N628.77bn shared in November.

Yuguda said that the shared amount comprised statutory revenue of N474.4bn, and N6.3bn being debt repayment made by the Nigerian National Petroleum Corporation.

Other components of the allocation, according to him, are Value Added Tax of N73.5bn, and an additional N15.6bn from the ECA was released to augment shortfall in revenue generated during the period.

Giving a breakdown of revenue among the three tiers of government, Yuguda said the Federal Government received N220.5bn representing 52.68 per cent; states, N111.8bn, representing 26.72 per cent while the local governments got N86.2bn or 20.60 per cent of the amount distributed.

He also disclosed that N47.2bn, representing 13 per cent derivation revenue was shared among the oil producing states.

The minister put the gross revenue received for the month of December at N490.03bn, noting that the amount was lower than the N500.07bn received in the previous month by N10.04bn.

Yuguda said a 12 per cent drop in crude oil prices between the month of October and November last year had a negative effect on revenue accretion to the federation account.

He said, “A 12 per cent drop in crude oil from $87.8m in October to $77.5m in November lead to a $62.8m loss in revenue.

“Also in volume, a 52 per cent loss was recorded coupled with a 31 per cent drop in a revenue generated by LPG and NGL all contributed negatively to the federation’s equity.

“The persistence of the force majeure declared by Shell since June, 2014 and the shutting of trucks and pipelines at various terminals also impacted negatively on the revenue performance.

“Also, non-oil revenue dipped due partly to the fact that the timeline for the payment of taxes by many companies is yet to fall due.”

The Chairman, FAAC Finance Commissioners’ Forum, Mr. Timothy Odah, who also spoke to journalists at the end of the meeting, expressed concern over the continued decline in revenue to the federation account.

He called for a more diversification efforts by all levels of government to ensure that the drop in oil price does not affect the programmes of the government.

Odah said state governments had to evolve new strategies to survive and stop the dependence on oil, advising that there was need for a wage review for political office holders and their appointees to save more money to meet other demands.