NEITI Reports N3.473 Trillion Disbursed by FAAC in Q2 2024

The Nigeria Extractive Industries Transparency Initiative (NEITI) has announced that the Federation Accounts Allocation Committee (FAAC) disbursed a total of N3.473 trillion to the federal, state, and local governments during the second quarter of 2024. This marks a modest increase of N46.77 billion, or 1.42 per cent, compared to the previous quarter.

In a statement issued on Monday, NEITI’s Assistant Director of Communications and Advocacy, Chris Ochonu, revealed that these figures are part of the organisation’s latest Quarterly Report on Federation Account Revenue Allocations for Q2 2024. The report, unveiled in Abuja by NEITI Executive Secretary, Dr. Ogbonnaya Orji, aims to shed light on the sources of revenue entering the Federation Account and the factors influencing its fluctuations.

“The ultimate goal of this disclosure is to enhance knowledge, increase awareness, and promote public accountability in the management of public finances,” Dr. Orji said.

According to the report, the Federal Government received N1.102 trillion, accounting for 33.35 per cent of the total disbursement. State governments collectively received N1.337 trillion, representing 40.47 per cent, while local government councils shared N864.98 billion, equivalent to 26.18 per cent of the total allocation. In addition, nine oil-producing states received N169.26 billion as their derivation share from mineral revenue.

A comparison with the previous quarter shows a mixed picture: while the Federal Government’s allocation fell by N41.44 billion (3.76 per cent), state governments saw an increase of N58.13 billion (4.29 per cent), and local councils experienced a rise of N30.82 billion (3.57 per cent). The report also highlights the contributions of the Nigeria Upstream Petroleum Regulatory Commission, the Federal Inland Revenue Service, and the Nigeria Customs Service as key revenue-generating agencies, providing funds through oil and gas royalties, petroleum profit tax, and company income tax, among others.

Delta State emerged as the largest beneficiary among the states, receiving N137.36 billion, including oil derivation funds. Lagos State followed with N123.28 billion, while Rivers State secured N108.104 billion. On the other end of the spectrum, Nasarawa, Ebonyi, and Ekiti States received the smallest allocations, with figures hovering around N25 billion.

Among local governments, Alimosho in Lagos topped the list with N5.72 billion, while Ifedayo received the smallest allocation of N661.82 million.

The report also highlighted the oil-producing states’ share of the 13 per cent derivation revenue. Delta State led with a 40.153 per cent share, followed by Bayelsa (38.112 per cent) and AkwaIbom (36.117 per cent). Rivers State, meanwhile, recorded a derivation ratio of 27.272 per cent, while other oil-producing states had lower percentages.

However, NEITI pointed out that solid minerals-producing states did not receive any derivation revenue during the quarter due to insufficient income from the sector.

In Q2 2024, Bauchi State faced the highest debt deductions, amounting to N6.49 billion, followed by Ogun State. In contrast, Anambra recorded the smallest deductions at N115.6 million, while Lagos and Nasarawa states had no debt deductions.

NEITI’s report recommended that states capitalise on ongoing reforms in the solid minerals sector to diversify their revenue sources. It also urged the Central Bank of Nigeria to take stronger measures to stabilise the exchange rate, reduce volatility, and ensure consistent remittances to the Federation Account.

Further, NEITI called on the Revenue Mobilisation Allocation and Fiscal Commission and the Office of the Accountant-General of the Federation to increase transparency in the payment of special revenue accruals, such as derivation arrears and debt repayment refunds.

Concluding, Dr. Orji encouraged citizens and civil society organisations to actively engage in monitoring public finances, emphasising the need for greater involvement in budget tracking and allocation oversight across all tiers of government.