President Goodluck Jonathan and state governors on Monday evening set up a four-man committee to resolve the crisis rocking the Federation Accounts Allocation Committee over the sharing of revenue accruing to the three tiers of government.
The commissioners of finance of the 36 states had walked out on the Minister of State for Finance, Dr. Yerima Ngama, last Thursday in protest over the manner in which the revenue allocation was being handled.
The decision to set up the committee was taken at a late night meeting Jonathan held with the state governors at the Presidential Villa, Abuja.
The Presidential spokesman, Dr. Reuben Abati, on Tuesday briefed journalists on the outcome of the meeting that ended at about 11:30pm.
Abati said members of the committee included the governors of Bauchi, Delta, Gombe and Anambra states.
He said the governors were expected to meet with the Minister of Finance, Dr. Ngozi Okonjo-Iweala; and Ngama to resolve the matter.
He said at the meeting, which he described as very friendly, the governors were happy at the President’s disposition to resolving the matter as all of them agreed that the money belonged to the people.
The Federal Government had blamed the shortfall recorded in the gross federally collected revenue as a major reason why it could not pay the over N160bn arrears to the three tiers of government.
The country is currently facing severe revenue challenges owing to illegal bunkering and oil theft.
The revenue shortfall was confirmed by Ngama, while addressing journalists shortly after a meeting of the Governor Isa Yuguda-led reconciliation committee in Abuja on Tuesday.
“We had shortages in revenue; so, the amount that we had statutorily reduced for the three tiers of government, including the Federal Government,” Ngama said.
But Okonjo-Iweala said the Federal Government had agreed to settle all outstanding issues relating to revenue allocation from the Federation Account.
She said, “An agreement has been reached on the Federation Account to resolve all outstanding issues to do with the Federation Account. As part of this, a commitment to settle the arrears of the Federation Accounts Allocation Committee payments has been agreed.
“This was the key development from a meeting of the committee set up by Mr. President to resolve this issue today (Tuesday).”
Worried by the shortage in revenue, Okonjo-Iweala said the committee had also resolved to address the root cause of the revenue challenges facing the country.
“The committee also resolved to tackle the root causes of the revenue challenges facing the country, including illegal bunkering and oil theft, in a decisive and sustainable manner,” she said.
The minister said the meeting, which was held in a positive and constructive atmosphere, reaffirmed the determination of the Federal Government and the governors to continue working together for the progress of the country.
To underscore the commitment reached at the meeting, Okonjo-Iweala said the FAAC meeting would be reconvened immediately.
The Forum of Commissioners of Finance from the 36 states led by the Chairman, Mr. Timothy Odaah, had expressed anger over the unpaid arrears amounting to about N160bn (about $1bn).
Information from Punch was used in this report.