Oil theft, other factors lead to revenue shortfall in July

The-Minister-of-State-for-Finance-Dr-Yerima-Ngama[1]The Federation Account Allocation Committee Thursday deducted N115 billion from the Excess Crude Account (ECA) to make up for revenue shortfall for July.

The withdrawal leaves the ECA at about $5.1 billion.

Also, a total statutory revenue of N715.84 billion was shared among the three tiers of government for July.

This came as the federal government yesterday announced the release of a total of N250 billion for capital projects for the third quarter of 2013.

The latest figure meant that a total of N850 billion has so far been released for capital projects this year.

Addressing journalists last night at the end of the month’s meeting of the committee in Abuja, the Minister of State for Finance, Alhaji Yerima Ngama, said gross revenue for the month dropped by N365.042 billion to N497.984 billion compared to N863.026 billion received in the previous month.

He blamed the shortfall on the continued crude oil theft, leakages occasioned by breaks in pipelines at various terminals as well as HP compressor failure and repair works.

The minister also said downward review of some companies’ estimates and a judgment debt by the Tax Appeal Tribunal on Education Tax had forced down the Petroleum Profit Tax (PPT) payable for the month.

But revenue from Value Added Tax (VAT) increased by N23.027 billion to N74.197 billion in July compared to N51.170 billion received the previous month.

Ngama said mineral revenue for the month stood at N361.935 billion representing a shortage of N136.122 billion from the N465.057 billion budgeted for the period.

Also, the non-mineral revenue which stood at N136.049 billion was below the N158.711 billion budgeted for the month.

Altogether, total net statutory revenue available for distribution after payment of collection costs to the Federal Inland Revenue Service (FIRS) and the Nigeria Customs Service (NCS), which received N4.1 billion and N2.3 billion respectively was put at N477.049 billion, representing a N113.457 billion shortfall.

Meanwhile, of the total statutory allocation, the federal government received N227.516 billion while the states shared N145.39 billion. The local governments received N88.96 billion while the sum of N45.1 billion was shared to oil and gas producing states as derivation fund.

For the VAT distribution, the federal government got N10.6 billion; states (N35.6 billion); while the local governments got N24.9 billion.

Also distributed was the N7.617 billion Nigerian National Petroleum Corporation (NNPC) indebtedness to the federation account as well as N35.549 billion under the Subsidy-Reinvestment Empowerment Programme (SURE-P).

Meanwhile, a statement from the Special Adviser to the Coordinating Minister for the Economy and Minister of Finance, Mr. Paul C Nwabuikwu, said in line with the priorities set out by President Goodluck Jonathan, the funds would be deployed to expedite the execution of key infrastructure, security and social projects captured in budget 2013.

According to the ministry of finance, the utilisation of the released funds for capital projects for this year now stands at 71 per cent.

“Also, all the funds released have been cash-backed. Implementation of various capital projects across the country is ongoing and currently, utilisation of the released funds for capital projects for this year stands at 71 per cent,” the statement explained.

The federal government had released N400 billion and N200 billion for capital projects in the first and second quarters of the year respectively.

The Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala had assured Nigerians that the executive had been diligently implementing the 2013 Appropriation Act.

She had added in a recent interview with THISDAY: “The country has been able to weather the shock. When you put in place the instrument of management, you don’t need to panic, you don’t need to go to the International Monetary Fund, and you don’t need to go to the World Bank. Have you seen us going for any budget support?
“Have we gone for balance of payment support? No, I think this is something we should be celebrating because we have put in place a mechanism once and for all for dealing with this so what we have done is through Excess Crude Account. By the way, the Excess Crude Account is a component of our overall reserves. Our reserves are $47 billion, of which our excess crude is $5.1 billion.

“When you look at the micro-economy, you begin to look and see what we need to do. The biggest issue there is job creation. That’s what we focused on. I want to say one thing. If you look at the history of our economy in the past, especially of all African countries, not just Nigeria alone, things have now changed for the better.”

 

Information from This Day was used in this report.

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