Modupe Gbadeyanka
By Modupe Gbadeyanka
Total FAAC disbursements in the third quarter of 2017 was N1.757 trillion which was 1.09 percent higher than the N1.738 trillion disbursed in the third quarter of 2016, the latest report released by the Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed.
In its quarterly review, the agency said this disbursement was 6.88 percent lower than the N1.887 trillion shared in the third quarter of 2015.
The report said Federal Government received the largest disbursement of N752.79 billion in the period under review.
This was followed by states which received N586.58 billion, while local governments received N363.98 billion.
These increased disbursements are in line with recent developments in the oil sector, where global oil prices have rebounded and Nigeria’s oil production has risen.
In the first quarter of this year, FAAC disbursed N1.411 trillion to the three tiers of government and N1.377 trillion in the second quarter.
These figures indicate that FAAC disbursements this year to the FG, states and LGs have been highest in the third quarter of 2017.
FAAC disbursements to the federal and local governments so far in 2017 were highest in July while they were highest for states in September.
Data from the NNPC shows that oil production averaged 1.953 million barrels per day in June 2017, which is the highest level of production recorded in over a year.
The last time oil production was this high was in March 2016 when 1.957 million barrels per day was produced.
The NNPC has attributed this increase in production to normalcy in the Niger Delta region and resumption of export activities at the Forcados Terminal after many months.
Disbursements to the federal government in 2017 were highest in July (N286.65 billion) and lowest in May (N163.90 billion). This is a difference of N122.75 billion, implying a 74.8% difference between the months with the highest and lowest disbursements.
States received the highest disbursements in September (N215.78 billion) and lowest in January (N141.12 billion), a difference of N74.66 billion. This indicates a 52.9% difference. Local governments received the highest disbursement in July (N134.93 billion) and the lowest disbursement was in January (N85.40 billion).
This reveals a difference of N49.52 billion or 57.9%. These figures suggest a high degree of volatility in government revenue across all three tiers of government.
This makes economic planning and execution of capital projects difficult, and further buttresses the need for diversified sources of government revenue to limit volatility and ensure more stable and predictable revenue streams.
The nine months followed a rise and fall pattern, except between May and July when two consecutive months of increases was recorded.
