How FG, states, LGs shared N4.336 trn in 2016

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8 years ago

The federal, states and local governments shared a total of N4.336 trillion between January and December 2016, a research by Nigerian Tribune has revealed.

According to data collated from various sources by Nigerian Tribune, the three tiers shared N1.103 trillion in the first quarter and N881.6 billion in the second quarter of the year.

In the months of July, August and September, the Federal Government, states and 774 local government councils jointly shared N1.357 trillion, while the Federation Accounts Allocation Committee (FAAC) disbursed N815 billion to these constitutionally recognised beneficiaries of federation account in the last quarter of the year.

Of these amounts, the Federal Government got the biggest share, amounting to N1,897,863; states’ share amounted to N1,478.882, while local government councils were allocated N941.371 billion.

Significantly, the difference between the Federal Government’s share and those of the other tiers did not reflect the huge differential that should have arisen from the percentage difference.

According to the extant revenue formula, the Federal Government takes 52.68 per cent, states got 27.72 per cent, while councils were entitled to 20.60 per cent of statutory and mineral revenue.

In the distribution of Value Added Tax (VAT), however, states got the biggest share of 50 per cent, local governments got 35 per cent, while the remaining 15 per cent went to the Federal Government.

As a result of low-grade oil prices coupled with reduced production due to activities of militants in the Niger Delta, revenue from non-oil sources represented the largest chunk of accruals to federation account during the year.

This then was the reason that disparity between the Federal Government’s share of FAAC allocation was not significantly different from that of states.

In addition, payments to joint venture partners, Nigerian Customs Service (NCS), Federal Inland Revenue Service (FIRS) and the Department of Petroleum Resources (DPR) also took significant portion of the federation account.

In the report, Lagos State was ranked first as the highest recipient of gross allocation with N178 billion in the 12 months, followed by Akwa State, N150 billion, Rivers State N134 billion, Delta State N126 billion and Kano State N111 billion. The five states cornered a quarter (25 per cent) of the total allocation for the states and local government councils in Nigeria.

Among the 10 highest recipients from the Federation Account were Bayelsa State, which got N99 billion, Katsina State N83 billion, Oyo State N80 billion, Kaduna State N78 billion and Borno State N73 billion.

The lowest recipients were Gombe and Ebonyi states that got N46 billion, each followed by Ekiti and Nasarawa states N47 billion each and Kwara State N49 billion.

The report further disclosed that Edo and Ondo, which were oil-producing states, got N59 billion and N70 billion respectively, while another state in the South-South, Cross River State, received N55 billion.