25 July 2018 ( Lagos ) : The total monthly payout by the Federation Account Allocation Committee (FAAC) for distribution to the three tiers of government amounted to N669bn (US$2.19bn) in July (from May revenues). This was a fall of N32bn from the previous distribution, made close to two months earlier. 

Officials from the federal ministry of finance shared even less information than usual after the meeting of the committee: so there was no colour on the split between mineral and non-mineral receipts, the relevant average crude price or the balance in the excess crude account.

The payout was delayed because of disagreement over the contributions to the federation account by revenue generating agencies including the NNPC. At this point in the month, analysts would normally be sharing details of the distribution of June revenues.

It was only made because of the hardship caused by the delay, notably over the payment of salaries to government employees at all tiers. Most state governments are struggling to pay their personnel with regular monthly FFAC distributions. The underlying disagreement has not been resolved.

In addition to the gross statutory allocation of N575bn, VAT receipts of N94bn were shared out after the deduction of collection costs. This was an increase of N5bn on the previous month. The FGN has scaled back its expectations of non-oil revenue in the 2018 budget: its own share of VAT, for example, is projected at N208bn, compared with N242bn in the 2017 budget.  There are no plans to revise the 5% standard rate of the tax.

Analysts have taken the latest payout details from thin local media reports. The data for earlier months in the chart are drawn from the OAGF.

Source : Gregory Kronsten, Olubunmi Asaolu, Chinwe Egwim from FBNQuest Capital Limited.

Reporting for EasyKobo on Wednesday, 25 July 2018 in Lagos, Nigeria