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Nigerian government receives N760.2 billion from FAAC in September

by Radarr Africa
written by Radarr Africa

The Nigerian Government disclosed that the Federation Account Allocation Committee (FAAC) allocated the sum of N760.235 billion to the Federal Government, states and local governments in September. 

This was disclosed in a statement by the Federation Account Allocation Committee (FAAC) on Thursday. 

Nairametrics gathered that oil-producing states received N59.992 billion as 13% derivation. 

The committee said N760.235 billion was released to the three tiers of government as federation allocation for September. 

The FAAC noted that the federal government received N294.244 billion, the states received N233.223 billion, and the LGCs received N172.776 billion. Oil-producing states received an extra N59.992 billion. 

Meanwhile, the gross revenue available from Value Added Tax (VAT) for September was N189.928 billion, as N60 billion in savings were from non-oil revenue and Electronic Money Transfer Levy (EMTL). 

 “The distribution is as follows; the Federal Government got N28.489 billion, the states received N94.964 billion, and Local Government Councils got N66.475 billion.”

They noted that the Gross Statutory Revenue of N502.135 billion distributed was higher than the sum received in the previous month, from which the Federal Government was allocated the sum of N232.921 billion. 

“States got N118.141 billion, LGCs got N91.081billion, and oil derivation (13 per cent mineral revenue) got N59.992 billion. Also, N8.172 billion of EMTL distributable revenue was shared to the three tiers of government as follows; the Federal Government received N1.226 billion, States got N4.086 billion, LGCs received N2.860 billion.” 

The sum was distributed accordingly as follows: Federal government received N31.608 billion, states got N16.032 billion and LGCs received N12.360 billion. 

They added that Oil and Gas Royalties also increased as Petroleum Profit Tax (PPT) and Excise Duty recorded a marginal increase. However, ”VAT, Import Duty and Companies Income Tax (CIT) decreased considerably”.

Meanwhile, the total revenue distributable for September was drawn from Statutory Revenue of N502.135 billion and VAT of N189.928 billion. 

They said, the total revenue distributable for September was also drawn from EMTL of N8.172 billion and Non-Oil Excess Revenue of N60 billion savings, which was converted to distributable revenue, which brought the total distributable for the month to N760.235 billion. 

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In case you missed it 

The thirty-six states of the federation, including the federal capital territory, recorded a cumulative internally generated revenue (IGR) of N1.89 trillion in 2021, an increase of 21.5% compared to N1.56 trillion recorded in the previous year. 

Lagos State, a major metropolitan city and the economic hub of the country generated a sum of N753.46 billion as internally generated revenue in 2021, accounting for 39.7% of the total inflows recorded by the 36 states and the FCT.  

The Federation Account Allocation Committee (FAAC) shared a total sum of N673.137 billion in August 2022 from the Federation Account Revenue to the federal government, states and local government councils. 

Source: Nairametrics

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BusinessBusiness and EconomyNigeriaWestern Africa

Nigerian Government warns against CBN’s proposed loan recovery from FAAC revenue

by Radarr Africa
written by Radarr Africa

Nigerian Government have warned that given the constant reductions in FAAC Allocation to states, it would be suicidal if the Central Bank of Nigeria (CBN) goes ahead to carry out its proposed recovery of state loans.

In reaction to the warning, the National Economic Council (NEC) said it will negotiate with the CBN and the Finance Ministry on loan recovery.

The developments were disclosed by Governor David Umahi of Ebonyi State after a virtual NEC meeting presided over by Vice President Yemi Osinbajo on Thursday at the Presidential Villa, Abuja.

The Governor added that NEC also agreed to set up a committee to engage the CBN governor and the Finance Minister.

He revealed that the NEC also endorsed the reviewed National Social Protection Policy ( NSPP) by the Minister of Finance, Budget and National Planning, Zainab Ahmed.

“Council was invited to note the revised NSPP that replaces the 2017-2022 NSPP, which was reviewed in consultation with all states and other stakeholders, he said.

“It is subject to review every five years for updates and accommodation of some of the emerging issues, which include pandemics, insecurity, and responsive social protection.

“The expected benefits of the revised NSPP include reduction of multi-dimensional poverty; promotion of social justice and equity and inclusive growth, reduction of unemployment, social and economic vulnerabilities and other threats to sustainable development,” he said.

Umahi also stated that the NEC approved a review of the plan for an immediate deduction of funds from the state. He said: 

“The governors are saying with the constant reduction in FAAC allocations to states, it would be very suicidal if the CBN goes ahead to carry out their proposed recovery of state loans.

“The governors and NEC applauded the president, the Vice President, the Minister of Finance and the CBN Governor for their efforts and commitment to states while noting that a lot of funds that were hidden from the states before the present administration have also been graciously given to states by the president and his team.

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“That has helped the states very much, so while commending them, NEC agreed to engage the CBN governor with the Minister of Finance and the governors’ forum and the NEC committee.

“So, it was agreed that these deductions would have to be reviewed to seek other ways; that if it goes ahead, the states would suffocate and that would not be good for the nation; NEC agreed to set up a committee to engage the CBN governor and the finance minister.” He said.

On the flooding incident across the country, Umahi noted that NEC agreed to set up a committee to look at the immediate solutions and interventions over the flooding and to see how we take care of those who were affected and states too.

The loans states take from CBN can be used for various purposes mostly infrastructure. Nairametrics reported earlier this year that the Rivers State Executive Council has approved the state government’s request for an N15 billion loan from the Central Bank of Nigeria’s Infrastructure Fund.

Rivers state said that tapping the fund will help speed up the completion of these projects, with a low-interest rate of 5% repayable within 20 years and a three-year moratorium.

Source: Premium Times

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AfricaAFRICA NEWSBanking, Finance & InvestmentBusinessNewsNigeriaWestern Africa

CBN begins deductions from states, and farmers’ accounts to recover loans from its intervention programmes

by Radarr Africa
written by Radarr Africa

The Central Bank of Nigeria (CBN) has commenced deductions from accounts of defaulters under its development finance interventions to recover outstanding loans.

Yusuf Yila, director, development finance of the CBN, said this during a post-Monetary Policy Committee (MPC) in Abuja on Wednesday.

Yila said the apex bank is determined to recover loans from states and farmers who were beneficiaries of any of its interventions.

Although he did not mention the debtor states, Yila said state governments’ monthly federation account allocation committee (FAAC) accruals are already being debited directly every month. 

This deduction, he said, will last six months.

According to him, the Anchor Borrowers Programme (ABP) and Commercial Agric Credit (CAC) are part of the intervention programmes.

“Every person(s) or state that took that loan (ABP) is going to pay. We have their BVN,” he said.

“These persons are smallholder farmers, who received funds for farming from state governments via the ABP, but have yet to pay them back.”

The CBN director further said the apex bank has started making plans to work with the Economic and Financial Crimes Commission (EFCC) to ensure that the loans were recovered.

Yila said while the ABP loan repayments were particularly low, CAC was almost excellent.

“Under the ABP, the CBN gave out about N1 trillion but recovered only N400 billion. But under the CAC, the bank lent out about N800 billion and recovered N700 billion,” he added.

“We have started recovering loans from state governments. We have been doing a loan workout programme with them, and we are debiting their monthly FAAC accruals directly for the loans.

“If a state government has taken N1 billion and is already in default, over six months, we debit them N150 million every month. So, we’ve started that programme.

“So, every single loan that has been given out through any of our intervention programmes must be paid back.

“There is absolutely no mercy. We have started; we are in recovery mode. At the development finance department, we have begun to recover the loans.

“There is the ABP which is a primary consumption element of our interventions. We lent out N1 trillion for the ABP, of which we have gotten over N400 billion back.

“Every single person or state that took that loan (ABP) is going to pay. We have their BVN. In fact, we have started implementing the Global Standing Instruction (GSI).

“We will continue to pull the account in the bank that they lent to or whichever bank that they have. Anytime we see money in that account, we will recover it.

“We are working with the EFCC. The CBN governor has approved the collaboration with the EFCC on loan recoveries.”

Yila also said that credit facilities extended to businesses and individuals have not performed poorly, adding that out of the N9 trillion intervention fund to instigate economic growth, about N5 trillion is still under moratorium.

Source: The Cable

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AfricaBusiness and EconomyNewsNigeriaWestern Africa

FAAC Disburses N802.407bn June Revenue

by Radarr Africa
written by Radarr Africa

The Federation Account Allocation Committee (FAAC) has shared a total sum of N802.407 billion being revenue that was generated in June 2022 to the federal government, states and local governments in Nigeria.

This represents an increase of 17.86 per cent compared to the N680.783 billion disbursed for the month of May to the three tiers.

The information was contained in a communiqué issued at the end of the FAAC meeting for July 2022, held in Abuja.

The N802.407 billion total distributable revenue comprised distributable statutory revenue of N608.580 billion and distributable Value Added Tax (VAT) revenue of N193.827 billion.

In June 2022, the total deductions for cost of collection by revenue agencies was put at N44.606 billion and deductions for transfers, savings, refunds and 13 per cent derivation to Anambra State was a total sum of N373.200 billion, according to a statement that was issued by Office of the Accountant-general of the Federation.

As at today, the balance in the Excess Crude Account (ECA) is $376,655.09 million.

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Total distributable revenue of N802.407 billion; the federal government received N321.859 billion, the state governments received N245.418 billion, while the 774 local government areas received N182.330 billion.

sum of N52.799 billion was shared to the relevant states as 13 per cent derivation revenue.

Gross statutory revenue of N1,012.065 billion was received for the month of June 2022. This is higher than the sum of N589.952 billion received in the previous month by N422.113 billion.

From the N608.580 billion distributable statutory revenue, the Federal Government received N292.785 billion, the state governments received N148.505 billion and the LGAs received N114.491 billion. The sum of N52.799 billion was shared to the relevant States as 13 per cent derivation revenue.

In the month of June 2022, the gross revenue available from the Value Added Tax (VAT) was N208.148 billion. That amount is lower than the N213.179 billion that was shared under the same component in the month of May 2022 by N5.031 billion.

From the N193.827 billion distributable VAT revenue, the federal government got N29.074 billion, while the states received N96.914 billion, with the local governments receiving N67.839 billion.

Source: Leadership

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