Nigeria: Govt suffers revenue shortfall of N423bn to low oil prices, pipeline vandalism

28 July 2016, Abuja – The Federal Government suffered a shortfall of N423.54 billion in revenue generation in the month of April, due to the current low oil prices at the international market.

*Crude oil export pipeline.

*Crude oil export pipeline.

Specifically, the N391.33 billion, estimated federally-collected revenue in April 2016, fell short of the provisional monthly budget estimate of N814.87 billion by tN423.54 billion

The Central Bank of Nigeria (CBN), which made this disclosure in its April Economic Report, stated that it was also lower than the receipt of the preceding month by 7.1 per cent.

According to the CBN, at N186.65 billion or 47.7 per cent of the total revenue, gross oil receipts fell short of the preceding month’s level of N227.69 billion by 18 per cent.

The decline in oil revenue was attributed to the fall in receipts from crude oil/gas exports owing to shut-downs and shut-ins in production arising from repair works at some Nigerian National Petroleum Corporation (NNPC) terminals and pipeline vandalism as well as the persistent low crude oil prices.

The CBN said that out of the total federally-collected revenue, the sum of N226.87 billion was transferred to the Federation Account for distribution among the three tiers of government; “N61.66 billion to Value Added Tax (VAT) Pool Account; N47.73 billion to the Federal Government Independent Revenue; and N13.47 billion to others”.

It noted that from the N226.87 billion transferred to the Federation Account, the Federal Government received N109.11 billion, while the State and Local Governments received N55.34 billion and N42.67 billion, respectively.

The balance of N19.75 billion, it added, was shared among the oil producing States as 13 per cent Derivation Fund.

Similarly, the sum of N61.66 billion was shared from the VAT Pool Account among the three tiers of governments as follows: Federal Government, N9.25 billion; State Governments, N30.83 billion; and Local Governments, N21.58 billion.

It stated: “In addition, the sum of N2.89 billion was shared as exchange gain as follows: Federal Government, N1.34 billion; State Governments, N0.68 billion; Local Governments, N0.53 billion; and 13% Derivation Fund, N0.34 billion. Furthermore, the Federal Government received the sum of N6.33 billion in respect of NNPC‟s 20th equal installment refund of indebtedness.

“Overall, total allocation to the three tiers of government from the Federation and VAT Pool Accounts in April 2016 amounted to N297.76 billion. This, however, fell short of the amount distributed in March 2016 by 11.4 per cent”.

  • The Guardian
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