According to TheCable, a disagreement between states and the Nigerian National Petroleum Company (NNPC) Ltd regarding unpaid remittances prevented the Federation Accounts Allocation Committee’s (FAAC) monthly meeting from taking place on Wednesday.CONTINUE FULL READING>>>>>
Until the national oil firm remits income totaling an estimated N1.7 trillion from November 2024, when the gasoline subsidy was completely eliminated, states have chosen to boycott the summit. Whether the meeting will still take place this week is unclear. The FAAC, which is composed of the permanent secretary of the federal ministry of finance, the federation’s accountant general, all state commissioners of finance, the minister of finance as chairman, and state accountants general, meets monthly to distribute federally collected revenues according to a sharing formula.
The states and the NNPC have previously clashed over unremitted earnings, which are typically attributed to subsidies that the national oil firm used to be solely responsible for as the importer of gasoline. However, President Bola Tinubu recently stated in a presidential TV talk that the federal government has not been relying on the NNPC to fulfill its financial responsibilities, marking the first time this has happened. According to a senior NNPC official who spoke to TheCable, the corporation has a lot of commitments, including crude swaps and forwards, which it has been using to fund its operations. According to him, this has an impact on its cash flow.
Between 2017 and 2022, FAAC face-offs were common because the NNPC either neglected to submit remittances to FAAC or deducted costs for subsidies that the states typically contested. At the monthly FAAC meetings, the federal government receives 52.68 percent of all income collected on behalf of the three levels of government, states receive 26.72 percent, and local councils receive 20.60 percent. Prior to the distribution of funds among the three tiers, states that produce oil receive an additional 13 percent.CONTINUE FULL READING>>>>>
