* Says revenues in Q2 2018 was the highest since Q3 2014
Chineme Okafor in Abuja
Within the first half of this year, the federal, state and local governments in Nigeria have shared a total of N3.95 trillion from the Federation Account, the Nigeria Extractive Industries Transparency Initiative (NEITI) on Monday disclosed.
According to NEITI in the latest edition of its Quarterly Review, the disbursements were made by the Federation Accounts Allocation Committee (FAAC) and they represented an increase of 41 per cent when compared to the N2.79 trillion disbursed in the first half of 2017.
The disbursements, it added, equally represented a 95 per cent increase in the N2 trillion disbursed within the same period in 2016.
The NEITI’s review provided highlights and indepth analysis of disbursements by FAAC for the second quarter and the first half of 2018.
In it, NEITI noted that the federal government got N1.65 trillion out of the entire money, while the states received N1.38 trillion, and local governments eventually got the least share of N795 billion.
A statement signed by NEITI’s Director of Communications and Advocacy, Dr. Orji Ogbonnaya Orji, and sent to THISDAY in Abuja also accompanied the review document.
The statement explained that the disparity in the revenues received by each of the three tiers of government was based on the revenue sharing formula of the federation as stipulated in the constitution.
However, the Quarterly Review stated that the lowest monthly figure of N635.6 billion disbursed in the first half of 2018 was N121.4 billion higher than the highest monthly figure of N514.2 billion disbursed in the first half of 2017 and N218 billion higher than the highest monthly figure N417 billion for 2016.
The review thus explained: “These figures clearly indicate that revenue accruing to the federation in the first half of 2018 completely outstripped revenues in the previous two years.”
It further disclosed that the total FAAC disbursements in the second quarter of this year was 46 per cent higher than the figure for the same period in 2017, and 127 per cent higher than the figure for the same period in 2016.
According to it, while N2 trillion was shared in the second quarter of this year, N1.38 trillion was disbursed during the same period last year and only N886.38 billion was shared in the second quarter of 2016.
“In fact, Q2, 2018 was the first time an amount in excess of N2 trillion was disbursed since Q3 2014. This is a run of 14 consecutive quarters of disbursements below N2 trillion,” said the review document.
NEITI stated that the phenomenal increase of disbursements recorded in the second quarter of 2018 was the highest to the federation since the third quarter of 2014. It linked this development to the rise in crude oil prices and similar increase in oil production.
It in this regard explained: “Average oil price in 2016 was $43.5 per barrel, while in 2017 oil price averaged $54.2 per barrel. However, in the first six months of 2018, average oil price was $70.6 per barrel.
“Thus, on the average, oil price increased by 62.2 per cent between 2016 and the first half of 2018. Total oil production in 2016 was 661.1 million barrels while the figure was 690 million barrels in 2017.
“In 2016, average monthly oil production was 55.1 million barrels while it was 57.5 million barrels in 2017. For the first two months of 2018 for which data is available, average production was 59 million barrels.” Going further, the review stated that net FAAC disbursement to states during the period under consideration saw Delta and Osun States receiving the highest and lowest revenues respectively.
It stated that: “The highest receiving state was Delta State with N101.19 billion, while the lowest receiving state was Osun State with N10.24 billion. This implies that Delta State received 988 per cent more than Osun State received.”
Akwa Ibom with N100.20 billion; Rivers with N85.01 billion; Bayelsa with N77.14 billion; Lagos with N59.52 billion; Kano – N39.88 billion; Edo – N32.88 billion; Kaduna – N32.86 billion; Ondo – N30.96 billion; and Borno – N30.04 billion, were according to the NEITI review, the top 10 earners of all the states between January and June from FAAC.
On the other hand, it stated that Taraba with N22.49 billion; Ebonyi – N21.61 billion; Kwara – N21.39 billion; Gombe – N20.64 billion; Platea – 20.60 billion; Ogun – N18.79 billion; Zamfara – N18.64 billion; Ekiti – 17.92 billion; Cross River – 17.13 billion and Osun – N10.24 billion were the 10 lowest earning states from the FAAC within the period.
On disbursements of revenue earned from Value Added Tax (VAT), the review explained that it increased by 35 per cent between the first quarter of 2015 and the second quarter of 2018.
“It is interesting that VAT has been generally increasing over time. This bodes well for the government’s efforts at increasing revenue from non-oil sources,” said the review document which however cautioned that the volatile and unpredictable nature of government revenues will continue to make planning difficult for all tiers of government and increase difficulties in implementing their budgets.