Revenue from federation account nosedives for July

After an improved earning from the Federation Account in June, the July allocation to the three tiers of government for July dropped from N559.032 to N443.663.

This was disclosed after the meeting of the monthly Federation Account Allocation Committee, FAAC, on Thursday in Abuja.

Permanent Secretary of the Ministry of Finance, Dr Mahmoud Isa-Dutse, while speaking to newsmen after the meeting, said the dip in allocation was due to the volume of crude oil sold in April.

Isa-Dutse also said that despite high hopes that Lagos State will start enjoying the 13% derivation as an oil producing state, it would not benefit from it until revenue starts accruing to the federation account from sales of oil from the state.

“The money has not started coming in yet. It’s only when revenue is realised that Lagos will start benefiting from the 13 per cent derivation”, he said.

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The permanent secretary also disclosed that that the revenue shared for July included the N1.373 billion recovered from banks as excess charges from 2008 to 2012, adding that the committee engaged the services of a consortium to determine “the true status of the bank charges collected on government funds saved with commercial banks. At the end of their assignment, it was discovered that some banks over charged the government and they were told to refund the money.”

Also revenue source included in the July allocation was the N36.494 billion exchange gain arrears for May 2016.
Isa-Dutse said: “The accrual arose from the June FAAC because the Central Bank of Nigeria (CBN) used the fixed exchange rate to calculated accruals into the account. However, the National Economic Council (NEC) directed the CBN to use the flexible exchange rate”.

By Timothy Enietan-Matthews…

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