The federal government of Nigeria has released a total of N625.43 billion as part of 13 percent oil derivation, subsidy and Sure-P refund to nine oil producing states.
In a statement titled: Oil Derivation, Subsidy and Sure-P Refunds: Nine Oil Producing States Receive N625.43bn in Two Years; N1.1trn Still Outstanding, which was signed by the Senior Special Assistant to the President on Media & Publicity, Garba Shehu, the federal government shared how the fund was disbursed and promised to ensure that the outstanding N1.1trn is paid to the respective states.
I have approved payments totalling 1.7 Trillion Naira to 9 oil-producing States,as refunds owed them by @NigeriaGov. As a matter of honour, all debts owed States must be paid, regardless of political affiliation. N625B has been paid so far; the balance will be paid in due course.
— Muhammadu Buhari (@MBuhari) December 2, 2022
“The states that received the refunds dating from 1999 to 2021 are Abia, Akwa-Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo and Rivers.
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Data obtained from the Federation Account Department, Office of the Accountant General of the Federation, show that a total of N477.2 billion was released to the nine states as refund of the 13 percent derivation fund on withdrawal from Excess Crude Account (ECA) without deducting derivation from 2004 to 2019, leaving an outstanding balance of N287.04 billion.
The States also got N64.8 billion as refund of the 13 per cent derivation fund on deductions made by NNPC without payment of derivation to Oil Producing States from 1999 to December.
The benefitting States still have an outstanding balance of N860.59 billion windfall from the refunds, which was approved by President Muhammadu Buhari.
According to the figures, under the 13 percent derivation fund on withdrawal from ECA without deducting derivation from 2004 to 2019, Abia State received N4.8 billion with outstanding sum of N2.8 billion, Akwa-Ibom received N128 billion with outstanding sum of N77 billion, Bayelsa with N92.2bn, leaving an outstanding of N55 billion.
Cross River got a refund of N1.3 billion with a balance N792 million, Delta State received N110 billion, leaving a balance of N66.2 billion, Edo State received N11.3billion, with a balance of N6.8billion, Imo State, N5.5 billion, with an outstanding sum of N3.3 billion, Ondo State, N19.4 billion with an outstanding sum of N11.7bn while Rivers State was paid 103.6 billion, with an outstanding balance of N62.3 billion.
The States were paid in eight installments between October 2, 2021 and January 11, 2022, while the ninth to twelfth installments are still outstanding.
On the 13 per cent derivation fund on deductions made by NNPC without payment of derivation, the nine oil producing States were paid in three installments this year, with the remaining 17 installments outstanding.
Under this category, Abia State received N1.1 billion, Akwa-Ibom, N15 billion, Bayelsa, N11.6 billion, Cross River, N432 million, Delta State, N14.8 billion, Edo State, N2.2 billion, Imo State, N2.9, billion, Ondo State, N3.7 billion, and Rivers State, N12.8 billion.
Meanwhile, the benefitting States shared N9.2billion in three installments in April, August and November 2022 as refunds on the 13 per cent derivation exchange rate differential on withdrawal from the ECA.
The three largest benefitting States were Akwa Ibom (N1.6billion), Delta State (N1.4billion) and Rivers State (N1.32billion).
Similarly, all the nine states received N4.7 billion each, totaling N42.34 billion as refunds on withdrawals for subsidy and SURE-P from 2009 to 2015. The refund, which is for all the states and local government councils, was paid on 10th November, 2022.
The Federation Account also paid N3.52billion each as refund to local government councils on withdrawals for subsidy and SURE-P from 2009 to 2015 on the same date in November.
President Buhari considers it a matter of honour and decency that debts owed to states or anyone for that matter be repaid, and in time without regards to their partisan political affiliations.
The President will continue to render equal service to all the states of the federation and an acknowledgment of this by Governor Nyesom Wike of Rivers State and the others is not out of place.
The refunds to the oil producing states will continue,” the statement said.
However, the announcement has sparked fresh criticism of the state governors who are said to be largely responsible the development deficiencies in Nigeria, particularly in human capital development.
Recently released report by the Nigeria Bureau of Statistics shows that 133 million Nigerians are in multidimensional poverty. This includes people living in the oil-producing states – receiving the 13 percent oil derivation fund. Some of them ranked among the most poverty-stricken states in Nigeria.
President Muhammadu Buhari had this week blamed the governors for the rising spate of poverty in the country. He said that the governors are not doing enough to alleviate poverty in their respective states, supporting the belief that most of the funds derived by the states are being misappropriated by their chief executives.