Govt revenue drops by N80.248b

• NNPC liquidates N450b legacy un-remitted revenue debt

• Begins modalities for refund of $1.48b PwC audit fund

• Minister insists Nigeria not broke, assures on release of  report

THE implementation of the yet to be passed 2015 Federal Government Budget may have run into a hitch as revenue to the Federation Account dipped by over N80.248 billion for last month when compared with that of last December, thus setting a stage for funding challenges, SURE-P being the first programme to get a zero allocation of its usual provision of N35.549 billion.

  The Federation Accounts Allocation Committee (FAAC) which met on Tuesday to distribute the January 2015 federally collected revenue told reporters that a total of N500.130 billion was the net amount for distribution among the three tiers as against the sum of N580.378 billion disbursed the previous month.

  The FAAC meeting which held about 10 days later than its usual monthly meeting days apparently due to the inability of the revenue generating agencies to ramp up revenue for distribution featured several disagreements between states’ representatives and the Federal Government officials represented by the Minister of State for Finance, Bashir Yuguda and the Accountant General of the Federation (AGF), Mr. Jonah Otunla as the states’ finance commissioners kept storming out of the Federal Ministry of Finance Auditorium, venue of the meeting for consultation to adopt a common position.

  The development dragged the meeting late beyond 9.p.m. before a mutual understanding could be reached between the Federal Government representatives and states’ over the revenue sharing table, while discussion on other issues continued till about 9.30p.m. when the meeting finally drew to a close.

    Addressing journalists at the end of the FAAC, the AGF who is the FAAC secretary explained that the dip in revenue generation was caused by the decrease in export volume and drop in price of oil at the international market as well as shut-ins of trunks and pipelines at some terminals.

  Otunla, according to a statement, gave a further breakdown of the revenue performance for the month under review as follows: Mineral revenue N305.397 billion, less N76.183 billion when compared with the N381.580 billion level obtained in December 2014; Non-Mineral revenue, of N110.699 billion slightly higher by N2.903 billion of the amount harvested last month and a VAT revenue of N63.935 billion less by N9.531 billion of the last December’s volume of N73.466 billion.

  He also listed other income stream for the month to include the foreign exchange gain following the Naira’s devaluation to the tune of N8.574 billion, the sum of N6.330 billion final refund and liquidation of the Nigerian National Petroleum Corporation’s ( NNPC) legacy N450 billion residual un-remitted fund which it has been making around 2011 and additional N5.195 billion remittance by the NNPC owed to the Federation Account which eventually swelled the amount for distribution to N500.130 billion which was eventually distributed among the three tiers of government and other statutory organisations that drew allocations from FAAC.

  A breakdown of the disbursement indicates that the Federal Government received the sum of N 194.349 billion, of the statutory revenue, representing its 52.68 per cent under the revenue sharing formula and another sum of N9.207 billion from the VAT revenue window; the states share the sum of N98.576 billion , representing their 26.72 per cent of their due under the statutory revenue formula and another sum of N30.689 billion from the VAT revenue while the  councils got the sum of N75.998 billion representing their 20.60 per cent share of statutory revenue and another sum of N21.482 billion from the VAT window. The oil producing states shared the sum of N39.450 billion representing their 13 per cent equity of the oil mineral derivation principle. The Nigerian Customs Service and the Federal Inland Revenue Service also received their due shares of seven per cent and four per cent respectively of their generated non-oil revenue generation for the month.

Economy still strong 

Meanwhile, Ambassador Yuguda has maintained that the Nigerian economy remained strong as had been attested by recent international rating agencies’ assessment and dismissed insinuations by some that the nation was broke as “mischievous and attempt by desperate politicians to score political point.”  He further argued that the country had continued to meet her obligations to both the federating states; investors in the country’s sovereign bonds as well as meeting contractors and workers’ obligations.

  He declared that discussion for the refund of the uncovered un-remitted sum of $1.48 billion to the Federation Account by the NNPC was at advanced stage and expressed the hope that the money would be remitted as recommended by the PwC audit firm that was engaged by the Federal Ministry of Finance, pointing out that the NNPC had fully liquidated its N450 billion legacy debt owed the Federation Account between 2009 and 2010.

  Yuguda added: “The good thing that has happened is the outcome of the forensic audit which has uncovered that there was $1.48 billion that is to be remitted to the Federation Account. They have done a thorough work. I have engaged the Ministry of Petroleum Resources and NNPC and we are working on the modalities of repayment of the said amount. And I want to assure you that very soon that the report will be made publicly to Nigerians so that everybody can have a look at it.

  “Let me again reassure you that Nigeria is not broke. I don’t know where that issue is coming from. As you have seen, since I assumed the chairmanship of FAAC, I have never skipped FAAC meeting as a result of lack of funds. I have never failed to meet payment of obligations in bonds and other contractual obligations to the Federal Government. The states are getting their monies promptly. The challenge is that revenue is coming from only one stream which is oil, which at the moment is facing key challenges with the price failing sharply at the international market. And this is affecting other sectors, because there is a link between the oil and other sectors.

  “Our economy is resilient. No investors will come into your economy if they know that the country is broke. In fact, the rating agencies have attested to Nigeria’s robust economy in the results of the assessment, which they willingly undertook on Nigeria. Therefore, we maintain that Nigeria is strong.  Only people who are trying to be mischievous or trying to make cheap political points are going about saying Nigeria is broke. But we are here to correct that,” the minister further said.