FG Depletes ECA By $1.68bn
- As FAAC shares N812.762bn for Nov 2018
BY COBHAM NSA, ABUJA – The current financial challenges being explained by Federal Government clearly reared its head on Wednesday with about $1.68 billion taken from the Excess Crude Account (ECA) to settle the last tranche of Paris Club obligations to the 36 States.
With the development, current balance in the ECA, a buffer account for government to cushion the effect of economic volatilities, shows about $631 million as at December 19, 2018
The Permanent Secretary, Federal Ministry of Finance, Dr Mahmoud Isa Dutse, who dropped the hint at the monthly Federation Account Allocation Committee (FAAC) meeting in Abuja, said; “The balance in the ECA is $631 million. The final payment for Paris club refund to states was made and the figure was deducted and that’s what accounts for the difference.”
Responding to questions on using the ECA to off-set the Paris Club refunds, Dr Dutse said the understanding reached by all stakeholders was that the repayment should be funded from the ECA, adding; “the Federal Executive Council (FEC) and the president approved the money” for this purpose.
According to figures from the last FAAC meeting in November, the ECA had $2.319 billion as outstanding balance which has now been dropped by 72.7 per cent.
On the monthly FAAC disbursements, the Permanent Secretary stated that the three tiers of government, Federal, States and Local Government Councils shared a total of N812.762 billion for the month of November 2018.
According to the communiqué issued by the FAAC Technical Sub-Committee, the gross statutory revenue for the month stood at N649.629 billion. This is a drop of about N32.533 billion from the N682.161 billion figure recorded in the preceding month
The total distributable revenue breakdown indicated that of the N812.762 billion, the statutory revenue stood at N649.629 billion; gross Value Added Tax (VAT) – N92.079 billion; and Forex Equalisation – N70.000 billion; with an exchange gain of N1.055 billion.
Of this amount, the Federal Government got N280.913 billion, representing 52.68 per cent; States went home with N142.483 billion, representing 26.72 per cent; Local Government Councils received N109.848 billion representing 20.60 per cent; while N47.882 billion, representing 13 per cent derivation revenue went to the Oil Producing States (OPS).
For VAT distribution to the three tiers of government, Federal Government got N13.259 billion, representing 15 per cent; States bagged N44.198 billion, representing 50 per cent with N30.938 billion, representing 35 per cent going to the 774 Local Government Councils in the country.
The Communique also indicated that revenue from the Company Income Tax (CIT) rose significantly while revenues from VAT, Import Duty, Petroleum Profit Tax (PPT) and Foreign Oil and Gas, Domestic Oil and Gas Royalties all recorded worrying downward trend.
In his reaction to the Excess Crude Account’s depletion, Accountant General of the Federation (AGF), Mr Ahmed Idris told reporters to direct their enquiries to the National Assembly (NASS) that gave parliamentary approval for the funds withdrawal.
Idris however insisted that the Federal Government “followed due process” in executing the refunds to States from the ECA.
