The federal government as well as the 36 states and 774 local governments in Nigeria shared about N12.45 trillion in the first six months of 2024, with N626.33 billion of that amount accruing to oil-producing states as 13 per cent derivation fund......See Full Story>>.....See Full Story>>
A THISDAY analysis of data from the National Bureau of Statistics (NBS) since the beginning of 2024 showed that in January the three tiers of government shared N1.67 trillion; it was N2.07 trillion in February while N2.33 trillion was disbursed between the federal government and sub-national governments in March.
In the same vein, in April, the total amount shared was N1.87 trillion; N2.19 trillion in May, while in June the federal government, states and local governments got N2.32 trillion in total. These funds amounted to N12.45 during the period.
The revenues made by the entire tiers of government was about N7.25 trillion higher in comparison with a figure of N5.2 trillion for the same period of January to June 2023.
Essentially, the Federal Account Allocation Committee (FAAC) sits every month to disburse revenue from various sources to the federal government, states and local councils.
This is even more critical because many sub-nationals are not able to generate enough Internally Generated Revenue (IGR) to fund their projects, leading to illiquidity without monies from FAAC.
The current FAAC revenue-sharing formula allocates 52.68 per cent to the federal government, 26.72 per cent to states, and 20.60 per cent to the local governments.
For the same period (January to June 2023) the Revenue Mobilisation Allocation And Fiscal Commission (RMAFC) in an earlier statement had said that a total sum of N5.2 trillion accrued to the Federation Account as captured in its monthly report to the FAAC by the Central Bank of Nigeria (CBN).
Given that figure, a THISDAY computation further revealed that put side by side with the monies generated last year in the first half, accruals to the federal government and the federating units skyrocketed by as much as 139.4 per cent this year in H1.
Similarly, the oil-producing states received an additional 13 per cent derivation fund, aside their other usual statutory accruals.
The nine key states that get this special funding include: Delta, Rivers, Akwa-Ibom, Bayelsa, Edo, Ondo, and to a lesser extent, Anambra, Abia and Imo states.
For the period under review, which spans January to June this year, these states raked in N626.33 billion extra from the 13 per cent derivation fund, which is primarily for oil-producing areas.
A breakdown of this amount showed that in January, N57.92 billion accrued to the states as 13 per cent funding; N85.10 billion in February and N166.24 billion in March.
In April, the oil-producing states received N90.12 billion; it was N120.45 billion in May, while the total revenue from the 13 per cent derivation in June was N106.50 billion.
Compared with the first half of 2024, the nine oil producing states shared a lesser sum of N544.9 billion from the federation account last year, a further review of NBS figures revealed.
Aside the fact that oil prices have stabilised at about $80 per barrel for over one year, the devaluation of the Naira by the Bola Tinubu administration has also seen more funds being made available to states due to exchange gain.
Also, apart from the 13 per cent derivation fund, a further 3 per cent is provided for host communities in the Petroleum Industry Act (PIA), from the oil companies operating expenses (OPEX).
In January 2024, most of the N1.67 trillion to the three tiers of government saw N875.38 billion recorded from the Statutory Account, N287.74 billion from Exchange Gain, and N18.60 billion from Electronic Money Transfer Levy (EMTL). Besides, of that amount, N492.51 billion was from Value Added Tax (VAT).
In February, N1.15 trillion was recorded from the Statutory Account, N479.03 billion from Exchange Gain, N16.59 million from EMTL, and N420.73 billion from VAT.
As for March, the N2.33 trillion to the three tiers of government comprised 1.19 trillion recorded from statutory account, N657.44 billion from Exchange Gain, N15.79 billion from EMTL, and N460.49 billion from VAT.
Similarly, of the N1.87 trillion to the three tiers of government in April 2024, it comprised N1.02 trillion from the statutory account, N285.52 billion from Exchange Gain and N15.37 billion from EMTL, while N549.70 billion was from VAT.
May saw the disbursement of N2.19 trillion, comprising N1.23 trillion from the statutory account, N438.88 billion from Exchange Gain, N18.77 billion from EMTL and N500.92 billion from VAT while in June FAAC disbursed N2.32 trillion to the three tiers of government from the total revenue generated in May 2024.
“The amount disbursed comprised N1.22 trillion from the Statutory Account, N587.46 billion from Exchange Gain, N15.78 billion from EMTL, and N497.66 billion from VAT,” the NBS data indicated.