The Ekiti State Government has petitioned the State House of Assembly on what it perceived as the manipulation of proceeds of earnings into the Federation Account and calls for a forensic audit of the Nigerian National Petroleum Corporation (NNPC) account.
The State Governor, Dr Kayode Fayemi, while addressing the State’s House of Assembly on the financial situation in the country and its implication on Ekiti State in Ado Ekiti on Monday, stated that the NNPC has continuously failed to fully account and remit proceeds of all oil exports into the Federation Account even as the Federation Account Allocation Committee (FAAC) reported underpayment of N3.03trillion oil proceeds received by NNPC to the Federation Account.
The Governor who noted that the use of flat exchange rate of N154.70 to $1 against N160 for computation of income accruing to the federation account is a deliberate step to reduce funds available to States and Local Governments asserted that interest earned on funds accruing to the federation account are not properly accounted for.
He stressed that the comparative of CBN monthly economic report and the monthly report of FAAC indicate that revenue accruing to the federation account were not fully reported.
Governor Fayemi who explained that failure to fully account for revenue accruing to the federation has significantly affected distributable revenue to States and Local Governments asserted that the effect of the depletion has created huge financial burden for the State to meet its obligations.
The Governor disclosed that Ekiti State’s monthly allocation suffers monthly reduction averaging N481 million; saying that the inability of the State Government to meet commitments as and when due may increase vicious circle of poverty in the country.
“Every State Government in Nigeria depends largely on the allocation from the federation account. The annual budget of the State is predicated upon earnings from the federation account. Consequently, any major change due to poor handling or depletion of the nation’s resources will usually have ripple effects on the implementation of budget at the State and Local Government levels”, he said.
Fayemi who frowned at the fusion of the office of the Auditor General of the Federation and Auditor-General of the Federal Government as well as the Account General of the Federation and Accountant General of the Federal Government called for a separation of the two offices in the spirit of true federalism.
He called for an assessment of the revenue into the federation account such that the Excess Crude Account which has “allowed the federal government to manipulate the proceeds of the earnings into the federation account” be abolished.
The Governor who called for an immediate review of the Revenue Allocation formula also urged the Supreme Court to expedite action on pending constitutional cases with regards to Excess Crude Accounts, illegal deductions and sovereign assets.
“Considering the current high level of depletion of revenue accruing to the federation account which is now a subject of dispute between the FG, CBN and NNPC, it is desirable that this august body is enjoined to critically assess revenue into the federation account and direct that all revenue accruing to the federation account should only be reported in the Consolidated Revenue Fund, and direct an immediate payment of all outstanding revenue due to the federation account by NNPC”, Fayemi submitted.
In his remarks, the Speaker of the State Assembly, Dr Adewale Omirin commended the Fayemi-led administration for not shirking its responsibilities despite the paucity of fund which is being experienced in the State as a result of the depletion in the federation account.
Omirin assured that the members of the Assembly would look into the situation and take necessary action .
Last modified: March 3, 2014