Total disbursements to the three tiers of government by the Federation Allocation Account Committee (FAAC) in 2018 was the third highest since 2013, the latest Nigerian Extractive Industries Transparency Initiative (NEITI) quarterly report has revealed.
The report published on Friday in Abuja showed a total of about N8.52 trillion was disbursed to the federal and 36 state governments, along with the federal capital territory, as well as the 774 local government councils during the year.
A review of the report showed the disbursement for 2018 was lower only to the figures for 2014 (N8.6trillion) and 2013 (N9.7 trillion).
Total disbursements for 2018, according to the report, was lower by about 0.83 per cent compared to the figure in 2014, and about 14.29 per cent against the figure for 2013.
However, the 2018 disbursement was higher by about 32.8 per cent than the figures for 2017 (N6.4 trillion); about 41.8 per cent more than N6 trillion in 2015, and 67.1 per cent more than N5.1 trillion in 2016.
A further breakdown of the FAAC disbursements showed the 36 states received about N2.85 trillion, or 33.4 per cent of the total disbursement for the year, while the 774 local governments got N1.667 trillion, or 19.6 per cent.
On the states’ share of the FAAC disbursements, the review showed five states received more than N100 billion each in 2018.
The states were Lagos (N119 billion), Bayelsa (N153.1 billion), Rivers (N172.6 billion), Akwa Ibom (N202.4 billion), Delta (N213.6 billion).
About 23 states received less than N60 billion each during the year. These include Cross River, Ekiti, and the Ogun States, which received N37 billion, N39.3 billion and N39.6 billion respectively.
Eight other states, namely Zamfara, Gombe, Plateau, Kwara, Ebonyi, Nasarawa, Taraba, and Adamawa, got between N40 billion and N49.9 billion.
Similarly, 12 States received between N50 billion and N59.9 billion include Yobe, Enugu, Kogi, Bauchi, Imo, Sokoto, Kebbi, Anambra, Abia, Benue, Niger, and Oyo.
Six states (Jigawa, Katsina, Borno, Ondo, Kaduna, and Edo) received between N60 billion and N69.9 billion, while Kano State received about N84.2 billion in 2018.
NEITI’s director of communication, Ogbonnaya Orji, said the report also highlighted concerns despite rising FAAC disbursements to the three tiers of government.
According to the report, despite the growing disbursements over the last three years, the allocations remained inadequate to meet states’ budgetary requirements.
“Clearly, there was no state that (was) capable to adequately finance its budget solely from FAAC disbursements,” the report said.
“There were three states – Delta, Enugu, Yobe – where FAAC disbursements were more than 50 per cent of their budgets. Disbursements for all other states were less than 50 per cent of their budgets.”
On internally generated revenues (IGR), the NEITI publication said it was highly unlikely IGR would make up for the shortfall in FAAC disbursements to states.
From the report, only four States (Cross River, Lagos, Ogun and Rivers) had IGR estimates above 50 per cent of their FAAC allocations, out of which only Lagos and Ogun had IGR that exceeded their FAAC allocations.
On revenue projections for 2019, the report predicted an increase in receipts into the government coffers from the oil and gas sector as well as FAAC disbursements.
“FAAC disbursements will increase further in 2019. This is largely due to the expected increase in Nigeria’s oil production and further consolidation of efforts by OPEC to keep oil prices from falling”, the NEITI publication said.
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