N606bn withdrawn from ECA in three months

The Federal Government withdrew the sum of N606.12bn from the Excess Crude Account within the first three months of this year, the Budget Monitoring and Evaluation report prepared by the Ministry of Finance has revealed.

The document presents information on the implementation of the 2013 budget in the first quarter. It also gives information by which government’s performance in the management of public resources as planned in the budget is to be measured.

The 33-page report, obtained exclusively by our correspondent on Monday in Abuja, was jointly signed by the Minister of Finance, Dr. Ngozi Okonjo-Iweala, and the Director-General, Budget Office of the Federation, Dr. Bright Okogu.

It details how crude oil theft, illegal bunkering and pipeline vandalism had affected the country’s projected revenue of N11.339tn for the 2013 fiscal period.

The projected revenue is made up of N7.734tn oil revenue, representing 68.2 per cent, and non-oil revenue of N3.605tn or 31.8 per cent.

According to the document, while inflow into the Excess Crude Account was N400.92bn in the three-month period; the sum of N616.12bn was withdrawn from it to augment revenue shortfall to the Federation Account.

A huge chunk of this, it was learnt, was shared by the Federation Accounts Allocation Committee to the three tiers of government to enable them to perform their statutory responsibilities.

The document stated, “The Excess Crude Account was set up to serve as a stabilisation and savings account. Inflows into the ECA in the first quarter of 2013 amounted to N400.92bn.

“The inflow in the first quarter was N73.88bn (or 15.56 per cent) and N446.99bn (or 52.72 per cent) lower than the N474.8bn and N847.91bn recorded in the fourth quarter of 2012 and first quarter of 2013, respectively.

“The sum of N606.12bn was withdrawn from the account in the first quarter of 2013.”

According to the document, the N606.12bn was withdrawn from the ECA as follows: payment of petroleum product subsidy, N50bn; distribution among three tiers of government (augmentation), N485.02bn; and transfer for the special intervention fund, N71.10bn.”

Further analysis of the actual performance of the oil and non-oil revenue receipts in the first quarter of 2013, according to the document, showed a mixed trend in the revenue.

For instance, an appraisal of the oil revenue in the first quarter of 2013 showed that the oil and gas royalties of N216.01bn, gas flared penalty of N1.12bn and petroleum profit and gas taxes of N814.22bn exceeded their respective quarterly expected estimates of N190.27bn, N620m and N590.79bn by N25.74bn (or 13.53 per cent), N500m (or 79.84 per cent) and N223.43bn (or 37.82 per cent), respectively.

On the other hand, crude oil sales of N724.84bn, gas sales of N64.0bn, rent of N100m and other oil and gas revenue of N380m were lower than their quarterly projections of N1.060tn, N89.90bn, N220m and N770m by N336.14bn (or 31.68 per cent), N25.90bn (or 28.81 per cent), N130m (or 56.82 per cent) and N390m (or 51.17 per cent), respectively.

The report stated, “In the first quarter of 2013, the actual net oil revenue that accrued into the Federation Account was N967.84bn, indicating a shortfall of N245.96bn (or 20.26 per cent) below the projected quarterly estimate of N1.213tn.

“On the other hand, the net oil revenue in the first quarter of 2013 was higher than the N905.69bn net oil revenue recorded in the fourth quarter of 2012 by N62.15bn (or 6.86 per cent).

“In spite of the favourable oil prices at the international market, the below-than-projected performance of the net oil revenue in the first quarter of 2013 was due to the fall in oil lifting figure during the period.

“A comparative analysis of the data further indicates that the aggregate gross oil revenue receipts in the first quarter of 2013 were not only lower than their respective projections for the period, but were also short of the corresponding levels in the same period of 2012.

“The low performance can be attributed to the incessant crude oil theft and pipeline vandalism in the Niger Delta region during the period.”

For non-oil revenue receipts, the report stated that N448.68bn was received within the first three months of 2013.

This, it added, signified a shortfall of N264.24bn (or 37.06 per cent) below the quarterly estimate of N712.92bn.

It said, “In the first quarter of 2013, the actual gross non-oil revenue of N448.68bn was received. This signifies a shortfall of N264.24bn (or 37.06 per cent) below the quarterly estimate of N712.92bn.

“A breakdown of the non-oil revenue items showed that all the items fell below their quarterly projected estimates. Value Added Tax of N180.41bn; Company Income Tax of N158.33bn and Customs and Excise Duties of N109.94bn were below their quarterly estimates of N236.32bn, N248.01bn and N198.24bn by N55.91bn (or 23.66 per cent), N89.68bn (or 36.16 per cent) and N88.3bn (or 44.54 per cent), respectively.”

Compared to their respective fourth quarter of 2012 outcomes, VAT, CIT and Customs and Excise Duties fell by N3.42bn (or 1.86 per cent), N9.76bn (or 5.81 per cent) and N11.07bn (or 9.15 per cent), respectively.

“The low performances of these revenue items in the first quarter of 2013 can be attributed to the slow pace of economic activities at the beginning of the year and it is expected that the trend will improve in the subsequent quarters of the year,” the report added.