This is hard news and a big revelation: “The Nigerian National Petroleum Corporation (NNPC) has said that it will remit nothing into the federation account in the month of May due to costs incurred from subsidy payments on petrol. The NNPC made this known in a letter written to the Accountant-General of the Federation, where it explained that it recorded a value shortfall of N111bn in February 2021. The shortfall, the NNPC said, will affect its contributions to federal allocations to states for April and May.”
The letter, seen by PREMIUM TIMES, was dated April 26 and signed by NNPC Chief Financial Officer, Umar Isa. Those copied in the letter include the Minister of Finance, Budget, and National Planning; the Director General, Nigeria Governors Forum; the Director Home Finance; and the Chairman, Commissioners of Finance Forum.
“The Accountant General of the Federation is kindly invited to note that the average landing cost of Premium Motor Spirit (PMS) for the month of March 2021 was N184 per litre as against the subsisting ex-coastal price of N128 per litre, which has remained constant notwithstanding the changes in the macroeconomics variables affecting petroleum products pricing,” the NNPC said.
“As the discussions between Government and the Labour are yet to be concluded, NNPC recorded a value short fall of N111,966,456,903.74 in February 2021 as a result of the difference highlighted above. Accordingly, a projection of remittance to the Federation for the next three months is presented in the attached schedule.
“Accordingly, the AGF is invited to note that the sum of N111,966,456,903.74 will be deducted from April 2021 Oil and Gas Proceeds due to the Federation in May 2021, which will translate to zero remittance to the Federation Account from NNPC in the month of May 2021.”
What can Nigeria do now to fill the void or do we expect another level of strikes as state workers go unpaid for months? These are real economic fractures because such calls from NNPC make it evident that Nigeria is not properly designed.
I mean, how can you just sleep month-long, only to wake up and travel to Abuja, drop your bank account number, and magically someone pays you, because you are a governor of a state. Within three days, you share that money. And then begin to sleep again, waiting for another end of the month. Twenty six states in Nigeria did not record FDI in 2020; Adamawa was among the outperformers for attracting just $20,000.
Twenty-six Nigerian states recorded zero foreign investment in the whole of 2020, figures released by the National Bureau of Statistics show.
The report on capital importation into the country, compiled by the Central Bank of Nigeria, was released on Friday by the NBS.
Will President Buhari use this letter from NNPC to call our parliament to begin a conversation on fiscal federalism towards deepening our productivity by exploiting our comparative advantages? This letter from NNPC will become more common as very soon, the world will move on from oil. So, now is the moment for Mr. President to begin to create Nigeria’s future if he wants to predict that future.---
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