FG, states, local governments share N10.143trn in 2023 – NEITI
In 2023, the statutory revenue allocations were distributed across the three levels of government: the federal, state, and local levels. Each level received N10.143 trillion from the Federation Account.
According to a report released in Abuja on Tuesday, this was stated by Dr. Orji Ogbonnaya Orji, Executive Secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI), on the allocation of revenues for the Federation Account in the year 2023.
According to Orji, the purpose of the NEITI FAAC Quarterly Review was to clarify the government-published allocations and disbursements of the Federation Account.
As he put it, the report’s overarching goal was to increase understanding and public scrutiny of public financial management organisations.
He stated that, according to the numbers, the federal government got N3.99 trillion, or 39.37 percent of the total.
In addition, he mentioned that out of the total N3.585 trillion, or 35.34 percent, went to the 36 states, while the 774 LGCs received N2.56 trillion, or 25.28 percent.
When compared to the N8.209 trillion given in 2022, an additional examination of the N10.143 trillion disbursements in 2023 revealed a growth of N1.934 trillion, or 23.56%.
After the new government floated the currency rate and eliminated the petrol subsidy, the evaluation found that revenue remittances to the Federation Account improved, which led to the increase.
“Although the overall amount of money that came into the Federation Account increased by 23.56% in 2023, the amount that went to each level of government changed because different kinds of money went into different accounts,” he explained.
According to the executive secretary, the NEITI Quarterly Review of 2023 FAAC allocations showed that the total amount allocated among federal, state, and local governments was N1.934 trillion greater than in 2022.
He claimed that allocation grew by 33.19 percent in the first quarter of 2023 compared to the same period in 2022, by 10.32 percent in the second quarter, by 27.49 percent in the third quarter, and by 23.42% in the fourth quarter.
From N3.42 trillion in 2022 to N3.99 trillion in 2023, the federal government’s contribution increased by N574.21 billion, or 16.79 percent.
The state governments received N3.59 trillion in 2023, up from N2.76 trillion in 2022—a 29.99 percent rise.
In a same vein, in 2023 the local government councils received N2.57 trillion from the federation, up from N2.032 trillion the previous year.
There was a 23.56% increase in total disbursed revenue from the Federation account in 2023, he added, and this was accompanied by a 26.22% increase.
He elaborated by saying that different types of revenue items injected into the Federation Account resulted in different increases for different levels of government.
Local governments saw a rise of 26.22 percent in their appropriations during the same time (2023), while states had an increase of 29.99%.
The allocation to the federal government, on the other hand, increased by 16.79 percent, he stated.
Orji went on to say that when looking at the distributions by state, the biggest chunk—N402.26 billion (gross)—went to Delta State, followed by Rivers with N398.53 billion.
He claims that the sum includes the portion of oil and gas revenues that goes to the state.
Ebonyi and Ekiti states got N73.91 billion and N74.04 billion, respectively; Akwa-Ibom State got N293.58 billion, the third-largest allocation; while Nasarawa State got the least amount, N73.32 billion.
The top five states in terms of allocation during the reviewed period are also some of the country’s most important oil-producing states, according to Ogbonnaya.
The thirteen percent allotted to states that produce minerals was distributed among nine states, he claimed, from the earnings of mining revenue.
States such as Delta, Akwa Ibom, Anambra, and Rivers continue to rely heavily on derivation money.
Additionally, states like Bayelsa, Akwa Ibom, and Delta had derivation income that were higher than their statutory revenues by 127.89%, 161.47%, and 141.25%, respectively.
During that time, derivation revenue accounted for 74.15% of Rivers State’s total revenue. The derivation revenue of the four states mentioned above was significantly higher than that of the other five oil producing states.
He mentioned that states like Ondo and Edo had derivation revenue of 27.71% and 30.4%, respectively, while others like Abia, Anambra, and Imo had derivation revenue of 20% or less.
The requirement to let income increase over time before sharing meant that states producing solid minerals did not get derivation revenues in the fourth quarter of 2023, according to the NEITI study.