The report noted that while N2 trillion was shared in the second quarter of this year, N1.38 trillion was disbursed during the same period last year
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Adewale Sanyaolu
The Federal, States and Local Government Areas across the country shared a total of N3.95 trillion from the Federation Account in the first half of 2018.
The disbursements made at the Federation Accounts Allocation Committee (FAAC) represent an increase of 41 percent when compared to the N2.79 trillion disbursed in the first half of 2017 and a 95 percent increase on the N2 trillion disbursed in the first half of 2016.
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This analysis is contained in the latest edition of the NEITI Quarterly Review published by the Nigeria Extractive Industries Transparency Initiative (NEITI). The review provided highlights and in-depth analysis of disbursements by FAAC for the second quarter and the first half of this year.
A breakdown of the disbursements showed that the Federal Government received N1.65 trillion with states taking N1.38 trillion, while Local Governments got the least share of N795 billion. The disparity in the revenues received by each of the three tiers of government was based on the revenue sharing formula of the Federation stipulated by the constitution.
The NEITI Quarterly Review shows that the lowest monthly figure of N635.6 billion disbursed in the first half of 2018 was N121.4 billion higher than the highest monthly figure (N514.2billion) disbursed in the first half of 2017 and N218 billion higher than the highest monthly figure (N417billion) for 2016. “These figures clearly indicate that revenue accruing to the Federation in the first half of 2018 completely outstripped revenues in the previous two years”, stated the report.
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The Quarterly Review further disclosed that total FAAC disbursements in the second quarter of this year was 46 per cent higher than the figure for the same period last year and 127 per cent higher than the figure for the same period in 2016. The report noted that while N2 trillion was shared in the second quarter of this year, N1.38 trillion was disbursed during the same period last year and only N886.38 billion was shared in the second quarter of 2016. “In fact, Q2, 2018 was the first time an amount in excess of N2 trillion was disbursed since Q3 2014. This is a run of 14 consecutive quarters of disbursements below N2 trillion.”
The phenomenal increase in disbursements recorded in the second quarter of 2018, the report observed, was the highest to the Federation since the third quarter of 2014. The report attributed the positive development to the rise in crude oil prices and similar increase in oil production.
“Average oil price in 2016 was $43.5 per barrel, while in 2017 oil price averaged $54.2 per barrel. However, in the first six months of 2018, average oil price was $70.6 per barrel. Thus, on the average, oil price increased by 62.2 percent between 2016 in the first half of 2018”, the NEITI Quarterly Review asserted.