A stalemate at the Federation Account Allocation Committee (FAAC) meeting on Wednesday over depleting statutory allocation is expected to be resolved at the National Economic Council (NEC) meeting holding in Abuja.
On Wednesday, the FAAC met in Abuja for the sharing of the statutory sharing of revenues between the three tiers of government for the month of February.
In attendance were members of the committee, consisting finance commissioners and accountants general of the 36 states of the federation and their federal government counterparts and the Federal Capital Territory.
However, those who attended the meeting said proceedings ended abruptly after about three hours of deliberations, as the committee could not agree on the revenue to share for the month.
The meeting, presided by the Minister of Finance, Budget and National Planning, Zainab Ahmed, held at the headquarters of the Federal Ministry of Finance started at about 5 p.m and did not end till about 8.37 p.m.
The Accountant General of the Federation, Ahmed Idris, was also in attendance, along with representatives of the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFAC), the Federal Inland Revenue Services (FIRS), the Nigeria Customs Service (NCS) and all other revenue-related agencies.
The Director of Press at the Federal Ministry of Finance, Hassan Dodo, said later that the meeting ended in a stalemate as members of the committee “could not agree on the amount presented for sharing by the revenue-generating agencies.”
Threshold for revenue allocation
Last year, the committee adopted the recommendation in the report of its special on guidelines on transfers into and withdrawals from the accounts.
In the report, the committee recommended that any month where the net distributable revenues available for sharing by the federal, states and local governments from the Federation Account falls below N680 billion, funds should be withdrawn from the Excess Crude Account to augment the shortfall to at least N680 billion.
On the other hand, where the net distributable revenue is between N680 billion and N730 billion, up to about N50 billion should be transferred into the ECA as saving.
Besides, if the net distributable revenue for the month is between N730 billion and N830 billion, the committee recommended that up to about N100 billion should be transferred to the ECA, or a minimum of N150 billion, if the figure is above N830 billion.
With oil revenues shrinking to the barest minimum following the impact of the coronavirus on oil exports, it was learnt that what was presented for sharing by the Nigerian National Petroleum Corporation (NNPC) and other revenue agencies for sharing was far below their usual benchmark amount.
Crude oil price crashed to about $25 per barrels on Wednesday, the lowest level in 16 years, as global markets continued to grapple with the negative impact of the coronavirus pandemic on the global economy.
Coronavirus bites harder
Already the crash has driven oil prices below government approved estimates in the 2020 budget, forcing a cut in the budget by 20 per cent and revision of the oil benchmark price to $30 per barrel.
It was learnt that members could not agree on how much should be drawn from the excess crude account to augment the allocation, as the balance in the account is at its lowest level.
At the end of the FAAC meeting for last January, the Permanent Secretary, Federal Ministry of Finance, Budget and National Planning, Mahmoud Isa-Dutse, announced the balance in the excess crude account as at February 19 stood at a paltry $71.81 million.
PREMIUM TIMES learnt that since the committee could not agree on the amount to share, members resolved to shelve further discussion and allow the Minister to take the matter before the National Economic Council (NEC) on Thursday.
The council chaired by Vice President Yemi Osinbajo, has the state governors of all the 36 states and the FCT as members, apart from the governor of the Central Bank of Nigeria (CBN), ministers and key officials as co-opted members.
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