Unremitted Funds by Nigeria’s Revenue Agencies Surge to N4.1 Trillion

The amount of unremitted funds by Nigeria’s revenue-generating agencies has ballooned to a staggering N4.1 trillion as of June 2024, according to the Federation Accounts Allocation Committee (FAAC). Despite recent efforts to reconcile outstanding debts, which saw N94.96 billion paid back in May, the unresolved amounts continue to grow, posing a significant challenge to the country’s financial management.

In a report released after its post-mortem sub-committee meeting, FAAC revealed that the unresolved amounts now include $165,067,714.53 (N178.52bn) and N3.92tn, a sharp increase from the previously reported $36,329,376.24 (N51.88bn) and N2.98tn recorded in May 2024. The report, signed by Mohammed Shehu, Chairman of the Revenue Mobilisation, Allocation, and Fiscal Commission, provides a detailed breakdown of the agencies involved.

At the forefront is the Nigerian National Petroleum Company Limited (NNPC), which owes the government N940.62 billion. In addition, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and NNPC together owe a combined $23.81 million and N1.94 trillion. Other notable debtors include the Federal Inland Revenue Service (FIRS) and NNPC, with an unresolved remittance of $141.25 million and N1.04 trillion, respectively. The Ministry of Solid Minerals Development and the Central Bank of Nigeria (CBN) are also reported to owe N48.75 million.

The growing arrears have sparked concerns about potential financial losses for the government. Two months ago, it was reported that the government risked losing over N3 trillion if these agencies did not reconcile their unremitted earnings. Kabir Mashi, Vice President of the FAAC Post-Mortem Sub-Committee, highlighted that the outstanding amounts are still under reconciliation at the monthly meetings held with the relevant agencies.

FAAC, responsible for disbursing allocations from the revenues generated into the Federation Account, has noted that the reconciliation process remains ongoing. In its June meeting, the chairman confirmed that the unresolved amounts due to the Federation Account stood at $165,067,714.53 and N3.92 trillion, with efforts continuing to bring these figures down.

The report also indicated some progress, with the Nigerian National Petroleum Company Limited and the Nigerian Upstream Petroleum Regulatory Commission making strides in revenue reconciliation. Additionally, it was disclosed that a cumulative N537.35 billion had been recovered from January to May 2024 through these efforts.

However, the scale of the problem remains daunting. Outstanding payments of $180,230,895.02 and N2.54 trillion from before June 2023 have been referred to the Stakeholders Alignment Committee for further action. The FAAC sub-committee is working closely with revenue-generating agencies to ensure that these substantial sums are remitted to the Federation Account as swiftly as possible.

Expressing concern over the situation, Shizzer Bada, the Finance Commissioner for Kaduna State, called attention to the accumulation of arrears, which now run into trillions of naira. She urged the need for a more expedited reconciliation process with the agencies to prevent further financial strain on the nation’s coffers.