FG, states, LGs share 1 billion dollars from Excess Crude Account

Finance Minister, Ngozi Okonjo-Iweala

The federal, states and local governments on Wednesday shared 1 billion dollars from the Excess Crude Account (ECA) “to execute some ongoing projects”, the Minister of State of Finance, Yerima Ngama said.

Mr. Ngama made this known to newsmen on Wednesday in Abuja at the end of the monthly Federation Accounts Allocation Committee (FAAC) meeting.

He also said the three tiers of government shared N27 billion from accumulated exchange gains saved from the surplus of the N155 per US dollar budgeted for the year 2012.

The minister said the withdrawals from the ECA were “for the development of the country”.
“State governments need the money to execute some of their projects,” he said, one month after he announced that the ECA had increased to 6.9 billion dollars from 5.8 billion dollars in June.
Mr. Ngama told newsmen that the 1 billion dollar withdrawal was because the ECA was close to “comfort level” of $10 billion threshold recommended by the National Economic Council (FEC) before the end of the year.
“If we had $6.9 billion half way (in July), it means that we are ahead of our target.
“This month we are crediting the excess crude account with N213.101 billion ($1.4 billion), and that will take us to almost $8 billion.
“This means that we are saving far more than we have planned to save and then we are now comfortable to distribute part of it to the three tiers of government.
This shows that we are putting very good financial management practice in place.
“This country can absorb any shock since our savings is exceeding the target level and I am assuring that before the end of the year we are going to hit the 10 billion mark given the level that we are saving,” he said.
Nigeria saves revenues above its benchmark oil price into the excess crude account.
The account dwindled from $20 billion in May 2007 to around $7 billion as at July 2012.
Earlier, the minister had announced that the Federal Government, the states and the local governments shared N574.40 billion from the Federation Account in July.
The amount distributed to the three tiers of government include N467.007 billion from the statutory allocation, N53.91 billion from Value Added Tax (VAT) and N35 billion from the Subsidy Reinvestment and Empowerment Fund Programme (SURE-P).
Also distributed was the N7.61 billion NNPC refund to states and local governments, and the 13 per cent derivation to oil producing states.
A breakdown of the figures showed that in the month of July, the gross revenue available from the VAT was N53.91 billion compared with N59.219 billion distributed the previous month.
The gross revenue of N825.396 billion received for the month of July was higher than the N763.553 billion received the previous month.
The minister attributed the increase to a rise in the quantity of crude oil exported in the month, lifting deposit payments and receipts of current and arrears of sales of NLNG.
He also announced that for the month of July, N60.276 billion was transferred to Non-oil Excess Revenue account after the distributable statutory revenue of N467.007 billion was shared among the three tiers of government.

 


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