President Buhari, VP Osinbajo and Nigeria’s state governors: Money Troubles

Nigeria’s 36 states and the Federal Government must have to device financial  survival strategies  as income from the distributable pool recorded a sharp decline for the month of August.

In July, local councils, states and the Federal Government shared N511.7 billion.

In August, only N442.6 billion was available, a sharp fall of N69.1 billion.

The decline in the money available for all the tiers of government will certainly send alarm signals to the various state capitals, necessitating the need for more belt-tightening.

Many of the states are already surviving on loans  provided by the Central Bank of Nigeria, at least to meet arrears of workers salaries. Analysts believe that a  drastic reduction in income will further compound their financial woes.

The Permanent Secretary, Ministry of Finance, Mrs Anastasia Nwaobia, announced the  N422.6 billion income on Tuesday after  the meeting of Federation Accounts Allocation Committee (FAAC) .

She said that the shared amount comprised the month’s net statutory revenue of N369.1 billion.

“Also, there is the exchange gain of N4.9 billion which is proposed for distribution.

“Therefore the total revenue distributable for the month of August including VAT of N62.1 billion, is N442.6 billion,” she said.

Nwaobia said N6.3 billion was refunded to the federation by Nigerian National Petroleum Corporation (NNPC) and was also proposed for sharing.

Giving the breakdown of revenue among the three tiers of government, Nwaobia said the Federal Government received N168.6 billion, representing 52.68 per cent while states received N85.5 billion, representing 26.72 per cent.

The local governments, she said, received N65 billion, amounting to 20.60 per cent of the amount distributed.

Nwaobia announced that N27.8 billion representing 13 per cent derivation revenue was shared among the oil producing states.

On VAT, she said that the N62.1 billion collected for the month showed a decrease of N12.7 billion from what was collected in the preceding month.

She said that the country generated N215.9 billion as mineral revenue and N153.1 billion as non-mineral revenue.

She said this showed a decrease of N12.8 billion and N51.5 billion, respectively, from what the country generated as mineral and non-mineral revenue in the preceding month.

She put the balance in the Excess Crude Account as at today, at 2.25billion dollars, which showed that noting had been removed or added to it since July.

Nwaobia lamented the low revenue generation for the month, while explaining certain reasons for it.

“The Shut down and Shut-in of production for maintenance at different times and terminals during the month of July were the major issues that negatively impacted crude oil revenue.

“Also, there was revenue loss of 8.6 million dollars as a result of drop in average price of crude oil from 61.2 dollars per barrel to 56.7 dollars in July, 2015,” she said.

In other matters, Nwaobia said that N12.5 billion was refunded to the Federal Inland Revenue Service because they were over deducted.