The Federation Account Allocation Committee (FAAC) disbursed the sum of N769.5 billion from the Federation Account to the three tiers of government in July 2019. This was disclosed in a communique issued by FAAC at the end of the meeting held in Abuja on Thursday.
According to the FAAC report, the N769.5 disbursed in July 2019 is 6.9 billion higher than the disbursement shared among the three tiers in June 2019 (N762.6 billion).
The breakdown: The gross statutory revenue of N674.365 billion received for July is higher than the N652.949 billion received in the previous month. This means the gross statutory allocation received rose by N21.416 billion.
The amount disbursed comprises of N652.949 billion from the Statutory Account and N94.159 billion from Value-Added Tax (VAT) collected.
FAAC Small and Medium Enterprises
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FG received the lion share: Further breakdown shows that from the net statutory revenue, the Federal Government got N299.799 billion, representing 38.9% of the total gross allocation in July.
States governments received N190.381 billion or 24.7% while the local governments got N143.569 billion and this represents 18.6% of the total.
Oil-producing states received N42.917 billion as 13% derivation revenue while Department of Petroleum Resources (DPR), Federal Inland Revenue Service (FIRS) and Nigeria Customs Service (NCS) received N92.857 billion as cost of revenue collection.
Federal Government received N285.767 billion, states received N144.945 billion and local councils received N111.746 billion of the N674.365 billion statutory revenue.
Also from the N94.159 billion VAT revenue, Federal Government received N13.559 billion, states received N45.197 billion and the 774 local government councils received N31.638 billion while the revenue-generating agencies received N3.766 billion.
Meanwhile, balance in the excess crude account as at Thursday was $274.407 million.
Upshots: Earlier in the month, there were indications that state governors in Nigeria might request for 42% share of the total federal allocation. Also, the Federal Government is finalising plans to inaugurate the Revenue Allocation Review Committee in the coming week.
According to a source, state governors are planning to revert and adopt the recommendation of an earlier report submitted by a sub-committee previously set up in 2011, to demand 42% of the federal allocation as against the 26.72% they currently get.
This becomes necessary as concerns over rising debt accruable to some states is seriously eating up into the allocation to the affected states. While debt is building up, only a few states in Nigeria have enough Internally Generated Revenue to spur economic activities without the Federal Government’s monthly allocation.
More trouble: After yesterday’s meeting, it was learnt that the Federal Government had set up a committee which comprises the Central Bank and the Ministry of Finance to recover the N614 billion bailout funds given to states.
The Vice President, Professor Yomi Osinbajo had previously spoken on how the current administration had in the last three years gave out close to N1.1trillion to states through loans, bailouts and Paris Club refunds.
To this effect, trouble may be building for states as the Federal Government may pounce on their monthly allocation to recover its funds. This may, in turn, cause a huge set back to several states.