The country’s monthly revenue prospects continued to plummet as gross receipts stood at N282.06 billion in April compared to N315.04 billion the previous month. This represented a drop of N32.98 billion from last month’s receipts.
Also on Friday, Nigeria’s interbank lending rates rose to 14.25 percent on average from 9.25 percent last week, after the Nigerian National Petroleum Corporation (NNPC) recalled some of its deposits from banks.
Nevertheless, a total distributable sum of N388.33 billion was yesterday shared among the three tiers of government for April compared to N435.05 billion shared in March.
Briefing journalists at the end of the monthly meeting of the Federation Accounts Allocation Committee (FAAC) in Abuja, Minister of State for Finance, Alhaji Bashir Yuguda said mineral revenue dropped to N180.47 billion in the period under review compared to N228.58 billion the previous month.
However, Non-mineral revenue increased to N101.59 billion from N86.46 billion in March.
The Value Added Tax (VAT) receipts also increased to N75.16 billion from N71.19 billion.
The minister however blamed the shortfall in statutory revenue on the frequent shut down and shut in of trunks and pipelines at terminals, impacting negatively on crude oil revenue.
But he added that an increase in average price of crude oil from $55.34m in February 2015 to $56.03m in March brought about $21.67m gain in revenue.
A rundown of statutory distribution showed the Federal Government N132.11 billion; states shared N67.01 billion while the local governments received N51.66 billion.
The sum of N23.10 billion was shared among the oil and gas producing states based on the derivation principle.
For VAT, the Federal government got N10.82 billion; states got N36.07 billion while the local governments shared N25.25 billion.
Meanwhile, Yuguda, who presided over the affairs of the committee for the last time before the expiration of the current administration urged state governments to make salary payment a priority amidst the current fiscal crisis.
He said: “We learnt from each other, we shared ideas but however in the last four months, the revenue stream has been falling due to crash in oil price. However, 2014 was a good idea for the non-oil sector especially the Federal Inland Revenue Service (FIRS) that has been able to scale over its target amount by N1.01 trillion.
“By and large, we have been able to work together. We need to look at the reality on ground and we did advise the states to prioritise their needs by ensuring that workers’ welfare in terms of salary payment is accorded a priority. The federal government has lived up to expectation, and we have advised states to put workers’ salary as priority.”
He urged incoming administration to embrace economic diversification, good governance and block all sources of revenue leakages in order to attain optimum service delivery.
It also emerged Friday that the Nigerian National Petroleum Corporation (NNPC) was yet to refund the sum of $1.48 billion into federation account as recommended by Pricewaterhouse Coopers which recently audited the corporation.
State governments are particularly anxious to get the remittance as they believe it would help them address the fiscal crisis at hand.
Chairman, State Commissioners of Finance Forum, Mr. Timothy Odah said: “I said it should be communicated to Mr. President. Incidentally, the most important thing is for the public to know that we campaigned and demanded for it because it is money meant for states and the federal government as well as local governments. Entirely, the money belong to the nation and Mr. President has directed that the money be paid into the federation account just as the minister of petroleum also directed but it is important to know we have not seen anything.”
Meanwhile, Nigeria’s inter-bank lending rates rose to 14.25 per cent on average yesterday from 9.25 percent last week, after the NNPC recalled some of its deposits from banks, reports Reuters.
NNPC sells dollars to some lenders on a monthly basis and transfers a portion of the naira proceeds to its account with the Central Bank, leading to a rate spike.
Banks had a balance of N214 billion at the Central Bank by yesterday compared with N494 billion last week.
In addition, cash outflows to bonds and treasury bills purchases totalling N202 billion ($1 billion) negatively impacted the liquidity level in the system and caused rates to rise, traders said.
Nigeria sold bonds worth a total of N60 billion ($302 million) at lower yields on all tenors at an auction on Wednesday.
The secured open buy back rose to 14 per cent from nine per cent, higher than the central bank’s 13 percent benchmark rate. The overnight placement rose to 14.5 per cent compared with 9.5 per cent last week.
“We see rates dropping to 10 percent level next week because of the anticipated disbursement of budget allocations to government agencies,” traders told Reuters, citing rising liquidity.
The liquidity level is expected to rise after the government injects money into the banking system to fund its transactions.
Meanwhile, the Central Bank of Nigeria’s (CBN’s) economic report for February 2015, showed that the banking sector regulator intervened four times in the money market through direct Open Market Operations (OMO) auction.
The Central Bank’s report showed that four maturities, ranging from 182 – 199 day tenors were traded in February. The amount offered, subscribed to and allotted were N160 billion, N279.28 billion and N217.33 billion, respectively. The bid rates ranged from 13.90 – 17.00 per cent, while the stop rates ranged from 14.50 – 14.84 per cent. CBN bills amounting to N529.95 billion matured and was also repaid during the period.
“Relative to the levels in January 2015, amount offered, subscribed to and allotted were N470 billion, N1,657.29 and N1,295.88 billion, respectively, while the bid rates ranged from 14–18 per cent.
“Treasury bills of 91-, 182- and 364-day tenors were auctioned at the primary market during the review period. On aggregate basis, the total amount offered, subscribed to and allotted stood at N334.83 billion, N716.28 billion and N334.83 billion, respectively, compared with N384.30 billion, N1,072.44 billion and N384.30 billion in January 2015. The bid-to-cover ratios were 1.17, 2.66 and 2.36 for the 91-, 182- and 364-day tenors, respectively,” the Central Bank report added.