In Three Months, FAAC Allocation Drops To N2.1trn
The Federation Account Allocation Committee allocation to the federal, state and local governments declined to 2.18tn between January to March 2022.
Data collated from different reports of the National Bureau of Statistics showed that in January 2022, the FAAC disbursed N766.47bn to the three tiers of government. This was from the total revenue generated in December 2021.
The amount disbursed comprised N560.07bn from the statutory account, N5.15bn from the Exchange Gain difference, and N201.26bn from Valued Added Tax. The Federal Government received a total of N279.46bn from the N766.47bn, while states and local governments received a total of N221.19bn and N163.88bn, respectively. The sum of N35.30bn was shared among the oil-producing states from the 13 per cent Derivation Fund.
In February 2022, the FAAC disbursed the sum of N692.86bn to the three tiers of government from the total revenue generated in January 2022.
The Federal Government received a total of N204.58bn from the N692.86bn, while the states and local governments received a total of N179.25bn and N131.88bn, respectively.
Figures for March 2022 showed that the FAAC disbursed the sum of N722.38bn to the three tiers of government from the total revenue generated in February 2022. The amount disbursed comprised N457.03bn from the statutory account, N80.00bn from the Non-oil Excess account, N7.48bn as Excess Bank Charges, and N177.87bn from Valued Added Tax. The Federal Government received a total of N236.18bn from the N722.38bn, while states and local governments received a total of N190.01bn and N140.61bn, respectively.
Cumulatively, the sum of N2.18trn was disbursed by the FAAC to the three arms of government in the first three months of 2022.
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However, the N2.18tn is lower than N2.24tn disbursed in the preceding quarter, Q4 2021.
Other remittances were made to the revenue-generating agencies comprising Nigeria Customs Service, Federal Inland Revenue Service, and Department of Petroleum Resources.
Further breakdown of the disbursements showed remittances to FGN consolidated revenue account, the share of derivation and ecology, revenue for the development of natural resources; and allocation to the Federal Capital Territory, Abuja.
According to a professor of Economics at Covenant University, Jonathan Aremu, the decline in FAAC allocation to the three tiers of government is not unconnected with a decline in government revenue in recent months.
He said, “It’s simple. The money that is allocated around the three tiers of government depends on what comes in. Then the indication is that what is coming in is becoming low. That’s the simple logic. That’s just an indication that the money coming into the Federal purse is going down. That’s the meaning.”