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Corruption probe: NDDC claims to have spent N81.5 billion in 7 months

The N81.5 billion was actually spent by the 2 Interim Management Committees of the NDDC.

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NDDC corruption probe: Commission denies spending N81.5 billion in 6 months 

As the corruption allegation against the Interim Management Committee of the Niger Delta Development Commission (NDDC), rages on, the commission has claimed that it spent N81.5 billion within 7 months (October 2019 to May 2020) as against media reports that the money was spent within 6 months (January 2020 to July 2020).

The disclosure was made in a tweet post by the Niger Delta Development Commission on its official twitter handle on Sunday, July 19, 2020.

The commission, while dismissing the media report as false, claims that according to the information from the Central Bank of Nigeria (CBN), the N81.5 billion was actually spent by the 2 Interim Management Committees of the NDDC between October 29, 2019, and May 31, 2020.

READ MORE: 2020 revised budget, spending inefficiencies, and a looming debt hole  

The tweet post from NDDC says, ‘’It’s false to say NDDC mismanaged N81.5 billion between January and July 2020. Truth is that sum was spent by two Interim Management Committees of the NDDC between October 29, 2019, and May 31, 2020, according to the Central Bank of Nigeria.’’

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‘’We are appalled that TVC could descend to propagating falsehood. We hereby demand that TVC recants, otherwise we’ll be compelled to take their misdemeanour up with the National Broadcasting Commission.’’

READ MORE: NDIC wants to be involved in the licensing of Nigerian banks

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It can be recalled that in May 2020, the Senate and the House of Representatives resolved to investigate members of the Interim Management Committee of the NDDC over allegations of mismanaging N40 billion within 3 months. The 2 chambers subsequently set up ad-hoc probe panels to look into the financial transactions of the IMC.

However, in the course of the sitting, Nairametrics reported that the acting Managing Director of NDDC, Prof. Kemebradikumo Pondei and his team walked out on the investigative panel of the House of Representatives, accusing the Chairman of the committee, Olubunmi Tunji-Ojo of being biased and corrupt.

Tunji-Ojo, while speaking said that documents from the CBN and the Office of the Accountant General of the Federation that were presented to the investigative panel showed that the NDDC had spent N81.5 billion between January 2020 and May 2020.

READ ALSO: Adeosun denies breaching fiscal responsibility act

What this means: The counterclaim by the NDDC that it spent the N81 billion from October 2019 to May 2020 as against the initial media report of between January 2020 and July 2020 can be seen as a strategy by the current Interim Management Committee to divert attention from the main issue of alleged mismanagement of N40 billion levelled against them. The difference in the mentioned periods, which is about a month, appears insignificant to cause any major change in opinion

This is also seen as a clever way of roping in the immediate past acting Managing Director, Joy Nunieh, who testified against and has been very critical of the Minister for Niger Delta Affairs, Senator Godwill Akpabio and the current management of NNDC. She was the head of NDDC from October 2019 to around February 2020, which is part of the period under review.

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Chike Olisah is a graduate of accountancy with over 15 years working experience in the financial service sector. He has worked in research and marketing departments of three top commercial banks. Chike is a senior member of the Nairametrics Editorial Team. You may contact him via his email- [email protected]

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Economy & Politics

Rivers State unemployment figures by NBS are fake – Wike

Governor Wike has dismissed the figures provided by the NBS concerning the rate of unemployment in his state.

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Kaduna and Rivers States in partial lockdown

The Governor of Rivers State, Nyesom Wike says that the National Bureau of Statistics’ data on unemployment in Rivers State is fake and politically motivated.

The Governor disclosed this during an interview with  Channels TV on Friday morning. He said the figures are fake and political.

“It is fake; it is political. The rate (unemployment) is high, but I don’t believe in their statistics,” he said.

Nairametrics earlier reported in August that the South-South geopolitical zone is the most affected region with a 37.0% unemployment rate, followed by South East (29.1%), North Central (27.9%), Northeast (27.9%), North West (26.3%), and South West (18.0%).

Rivers State is ranked second place, with unemployment in the region at 43.7%, and underemployment at 19.8%. 1,714,189 residents were recorded as unemployed, with a total labour force of 3,921,860.

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“If you have a lot of construction jobs going on, for example, does that not create employment? In Rivers State today, nobody can tell me that we have not tried in terms of employment; to reduce the level of unemployment,” Wike said.

The Governor cited formal and informal infrastructural projects across the state, which offers a means of livelihood to labourers. He went further to call on the NBS to be more deligent in their research.

“NBS should come to the state and see for themselves and see what we are doing to create jobs. Not just sitting in their offices. They never deployed anybody to come here,” Wike said.

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Economy & Politics

FAAC disburses N696.2 billion in July 2020, as Lagos State parts with N1.46 billion  

The sum of N696.18 billion to the Federal, State, and Local governments in July 2020 from the FAAC account.

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States lose N35.51 billion to bail-out , FAAC disburses N650.8 billion as South-South states receive highest share

The Federation Account Allocation Committee (FAAC), disbursed the sum of N696.18 billion to the Federal, State, and Local governments in July 2020, from the revenue generated in the month of June 2020. This was stated in the latest FAAC report, released by the National Bureau of Statistics (NBS). 

According to the report, the monthly disbursement increased by 27.2% compared to N547.3 billion shared in June, and 14.8% increase compared to N606.2 billion disbursed in May 2020. 

READ: Nigeria total public debt hits N31 trillion as debt service gulp over N1.2 trillion in H1 2020 

Checks by Nairametrics research, shows that a total of N4.58 trillion has been shared to the three tiers of government, between January and July 2020. Highest disbursement was recorded in April (N780.9 billion), followed by N716.3 billion in January 2020. 

Meanwhile, Lagos State – the economic hub of Nigeria, parted with N1.46 billion as external debt deductions in the month, indicating a total of N9.74 billion deductions between January and July 2020. 

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Explore the Nairametrics Research Website for Economic and Financial Data

Breakdown 

  • The amount disbursed in July comprised of N474.53 billion from the Statutory Account, N128.83 billion from Valued Added Tax (VAT), N42.83 billion from Exchange Gain Differences, and Distribution of N50 billion from Non-Oil Revenue for the Month. 
  • Federal Government received a total of N266.13 billion from the total disbursement. States received a total of N185.77 billion, and Local Governments received N138.97 billion. 
  • The sum of N28.50 billion was shared among the oil producing states as 13% derivation fund. 
  • Revenue generating agencies such as Nigeria Customs Service (NCS), Federal Inland Revenue Service (FIRS)and Department of Petroleum Resources (DPR) received N6.32 billion, N15.05 billion, and N2.68 billion respectively as cost of revenue collections. 

READ: Nigeria considers request for debt relief as debt stock climbs

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South-South scoops highest share 

The South-South region, also known as the Niger Delta region, received the highest share of the disbursement in the month of July. The region received a sum of N49.44 billion, representing 25.4% of the total net allocation for states. 

This is largely because the region contributes mostly to crude oil production in Nigeria, which is a significant source of revenue for the federation. Out of the six states in the region, only Cross River State is not an oil producing state. Hence, Rivers, Edo, Akwa Ibom, Bayelsa, and Delta States received a total of N24.28 billion as part of 13% oil derivation fund.  

North-West region received N36.83 billion (18.9%); followed by North-Central region, which received a net total of N30.69 billion (15.8%). Others include South-West (N29.55 billion), North-East (N26.32 billion), and South-East (N21.97 billion). 

READ: Fidelity Bank to raise N50 billion in bonds in Q4 to refinance existing debts

External debt deductions 

A total of N4.47 billion was deducted from the state’s allocation, as external debt deductions for the month of July. Lagos State parted with the highest amount of N1.46 billion, representing 32.6% of the total debt deductions in the month. A sum of N9.74 billion has been deducted as a result of external debt obligations between January and July 2020. 

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READ: Investors flee Nigerian Stocks as FDI and FPI dips

It is worth noting that, the State’s external debt has declined by 9.67%, from $1.39 billion recorded as at the end of December 2019 to $1.26 billion in June 2020. 

Others on the list of top 5 deductions are, Kaduna (N414.6 million), Oyo (N305.4 million), Rivers (N280.3 million), and Cross River (N222 million). On the flip side, Ogun State parted with the lowest, as N9.1 million was deducted, followed by Borno (N21.6 million), and Taraba (N24.5 million). 

READ: Nigeria’s manufacturing sector contracts for 5th consecutive month – CBN 

Upshot 

  • With dwindling federally collected revenue, caused by volatility in global crude oil price and economic downtrend caused by COVID-19 pandemic, it is evident that federal allocations will likely face drastic decline, which is a cue for the State governments to strategize on more creative ways of generating revenue internally.  
  • A quick check at the states’ IGR numbers, shows that 91.9% of the states in Nigeria with the exception of Abuja, Ogun, and Lagos States rely more on federal allocation, as against internally generated revenue. 
  • This implies that several states in Nigeria are technically bankrupt without debt financing, and Federal Government monthly allocation. 

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Economy & Politics

Buhari to finally send Petroleum Industry Bill to National Assembly next week

Sources in the Presidency have disclosed that the President may be presenting the bill to the National Assembly.

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Four dangerous circumstances forces FG to close Enugu Airport until further notice, aviation sector. FG’s conditional cash transfer progarmme gets more beneficiaries despite criticism

President Muhammadu Buhari is expected to present the long-awaited Petroleum Industry Bill (PIB) to the Senate as early as next week.

According to Reuters, who were quoting 4 sources familiar with the development, the presentation of the bill to the National Assembly, follows its official approval by the president late last week. This is as the National Assembly has already formed teams of members that will work most closely on the individual portions of the bill.

Both chambers of the National Assembly must have to pass the bill after deliberating on it before it can then be passed on to the president for his final signature.

The PIB which is an oil reform bill has been in the works for about 20 years, is key to the repositioning of Nigeria’s Oil and Gas Industry under its post-COVID-19 agenda as the main laws governing oil and gas exploration have not been fully updated since the 1960s due to some contentious issues like taxes, payments to local communities, terms and revenue sharing within Nigeria.

The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), had disclosed that the delay and non-passage of the bill has made international investors to start losing confidence in the country’s oil and gas industry.

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While revealing last month that the PIB will be presented to the National Assembly in the next few weeks, the Minister of State for Petroleum Resources, Timipre Sylva, also said that the executive arm will be requesting the lawmakers to specially reconvene to receive and start deliberations on the bill.

These oil reforms and regulatory certainty became more pressing this year as low oil prices and a shift towards renewable energy made competition for investment from oil majors tougher.

The draft copy of the bill which was prepared by the Petroleum Ministry is a product of series of consultation between the federal government, oil and gas companies and other industry stakeholders.

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Excerpts from the bill reported by Reuters include provisions that would streamline and reduce some oil and gas royalties, increase the amount of money companies pay to local communities and for environmental clean-ups alter the dispute resolution process between companies and the government.

It also included measures to push companies to develop gas discoveries and a framework for gas tariffs and delivery. Commercializing gas, particularly for use in local power generation, is a core government priority.

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