STATES Finance commissioners have expressed shock at the alleged disappearance of the sum of $1 billion from the Excess Crude Account (ECA) fund between last month and yesterday.
Finance Minister of State, Ambassador Bashir Yuguda, at the end of the Federation Accounts Allocation Committee (FAAC) meeting told reporters that the ECA balance was $3.1 billion as at yesterday, down from the $4.1 billion level last month.
But in a quick reaction, the Chairman of Finance Commissioners’ Forum, Mr. Timothy Oda,h said states were not aware that the said amount ($1 billion) had been drawn down and distributed among the three tiers of government.
Odah said: “States are not aware of this $1 billion withdrawal from the ECA. We were just hearing about the information as you people asked the question. Nobody has briefed us about the withdrawal. If we were aware of the development, we would have asked the question. Now that we have heard, we are going to demand explanation of the whereabouts of the $1 billion.”
The development came as the three tiers of government distributed the sum of N628 billion being statutory revenue and VAT collections for November.
A breakdown of the figures indicated that mineral oil revenue generated the sum of N383.147 billion, down from the N420.035 billion in the previous month; non-mineral oil revenue was equally down by N1.495 billion, failing to N115.162 billion away from the N116.657 billion the previous month.
VAT equally dropped to N58.213 billion from N64.452 billion the previous month. The revenue as usual was distributed in line with the revenue sharing formula of 52.68 per cent for the Federal Government; 26.72 to the states and 20.60 per cent to the local councils in addition to the other beneficiaries from the account like the nine oil mineral producing states and revenue generating agencies of the Federal Government.
Meanwhile, Finance Minister, Dr. Ngozi Okonjo-Iweala, was yesterday at the FAAC to appeal for more prudence on the part of the states because of the current slide in the fortunes of the country and advised them to be more imaginative aimed at creating more avenues of revenue generation.
She spoke to journalists shortly after the closed-door meeting with the FAAC members: “ As you know it is the end of the year, we are presenting the budget; we are laying the budget tomorrow. And I wanted to share with the honourable commissioners of finance, the accountants general under the able chairmanship of the honourable minister of state finance. Some of the reasons behind the parameters that we put in the budget, because as you know it doesn’t only affect the federal government but also the states. But I want you to know this is not the first time we are meeting. We had already met in Enugu and we had already discussed the difficult situation that was coming up. So today was just for us to exchange views with the commissioners on what we should do at both federal and state level to help manage the situation.
“Once we make adjustment at federal level, at state level they also have to make adjustments. So that was what we discussed; what might be the type of measures, so that we all assure a soft landing even for our states and we agreed that we will put together, we will work together. Each state has its own peculiarity; some have more IGR than others; some have higher recurrent than others, we take it state to state to try and see what do we need to do, we at federal level want to be of assistance to the extent we can. So it’s that kind of constructive meeting that we had.
“You know naturally with the states, we will be looking at, again just like we did at the federal level short term and long term, in the short term those who have the capacity, in fact all of them should look towards raising more internally generated revenue. But in the medium term we will also look at tax policy , issues like the VAT. You know governors already rose from their last national economic council to say that they will like the VAT to be looked at.”
“This is a matter which have to be taken to the National Assembly. But you know that if we are able to make a movement on th VAT it will benefit the states more. The federal government only gets 15% of the VAT but the states gets the rest. And we are desirous to see that they have a better time of it. So these are some of the issues that we put on the table and discussed. How would we go about it, you know in the coming month.
“We are not increasing it yet. I was asked a question, what are the measures we could look at. You know tha the measures we already announced which would be announced in the budget tomorrow will have to do with some luxury surcharges that we are putting on and some of the longer or medium term measure that we put on the table we will look at because National Assembly is also involved. You know some of the measures will be very specific ate the budget presentation tomorrow but each state will have to look at such circumstances. And all we are saying is we are ready to work with you, we are ready to support you and we can if some of them are doing well the way we are sharing ideas they can also share with us.
“We put our minds together that is what we are discussing. We also discussed some very good things happening in the economy which will cushion the impact by the way. When you look at prices and again I will repeat this tomorrow for the budget, you saw that inflation has come down. According to national bureau of statistics 7.9% agriculture prices in most places are either holding steady or have even dropped. I will say more about this tomorrow. This is one of the sound points within the economy where for the average Nigerian, this government is ... Try to do things in a manner that will not affect the average Nigerian and the fact that the diversification if the economy ... Agriculture is working and we are getting more food and prices Re reasonable. It is a very sound point.”