In this exclusive report, Economic Confidential reveals that even as it has become apparent that Nigeria may not meet any of the key points in the Millennium Development Goals (MDGs) and the Debt Management Office (DMO) and Central Bank of Nigeria (CBN) crowd out the private sector from the debt market, a large chunk of money accruing to the Federation Account is spent without consideration for value.
Despite massive unemployment, high rate of maternal mortality, terrible state of the roads, epileptic power supply and all the other hallmarks of backwardness apparent in the Nigerian polity, a cool sum of N10.8 trillion was shared among the three tiers of the Nigerian government in 2012.
This was despite the yawning loopholes in the revenue sources of government through which knowledgeable sources insist, at least another N4 trillion escaped into private pockets without getting into the federation account.
An extensive and exhaustive research by the Economic Confidential revealed that the N10 trillion was disbursed from the federation account at the monthly Federation Account Allocation Committee (FAAC) meetings statutorily chaired by the Minister of State for Finance although the Constitution vested this sharing responsibility in the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC). Part of the allocations was also disbursed extraordinarily by the National Economic Council (NEC) at its quarterly meetings chaired statutorily by the Vice President of he Republic.
Of this amount, N8 trillion came from two sub-heads of statutory allocation and value added tax (VAT). In the first part of the exclusive research published by the Economic Confidential magazine earlier in the month through the on-line edition, it was disclosed that from the N8 trillion, Akwa Ibom State got the highest share of N217bn followed by Rivers which received N177bn and Lagos N168bn in the 12 months of 2012.
On the other end of the table, Ebonyi State, Gombe State and Nassarawa State emerged the poorest states with total allocations of N45bn, N48bn and N49bn respectively.
Additionally, both the Debt Management Office (DMO) and Central Bank of Nigeria (CBN) are regularly in the market deploying both money market and capital market instruments to raise funds. Statistics show that public domestic debts amounted to over N6.153 trillion as at mid December 2012.
In as the fresh table just compiled, other subheads like NNPC refund, foreign excess crude account, naira excess crude account, budget augmentation and others were included thus amounting to a total of N10.8 trillion.
UK Prime Minister, David Cameron recently challenged the Nigerian Government to account for $100 billion oil money that accrued to Nigeria in 2012 from crude oil sales alone.
According to Mr Cameron, “last year Nigerian oil exports were worth almost $100 billion, more than total net aid to the whole of sub-Saharan Africa. Put simply, unleashing the natural resources in these countries dwarfs anything aid can achieve – and transparency is critical to that.”
Speaking at G8 Economic Summit in Davos, David Cameron said, “a few years back a transparency initiative exposed a huge black hole in Nigeria’s finances – an $800 million discrepancy between companies’ payments and government’s receipts for oil. This is leading to new regulation of Nigeria’s oil sector – so the richness of the earth can actually enrich the people of that country. And the potential is staggering.
“So we’re going to push for more transparency on who owns companies, on who’s buying up land and for what purpose, on how governments spend their money, on how gas, oil and mining companies operate, on who is hiding stolen assets and how we recover and return them.”
Another report from its Committee on Finance just adopted by the House of Representatives documented how parastatals and agencies illegally withheld N8.06 trillion realised by 60 bodies between 2009 and 2011.
The report revealed that the agencies, the collected N9.3trn as revenues in the period under review but only remitted N174.7bn to the government coffers.
The list include, Nigerian National Petroleum Corporation, NNPC; Central Bank of Nigeria, CBN; Nigerian Maritime Administration and Safety Agency, NIMASA; Nigerian Port Authority, NPA; Federal Mortgage Bank, FMBN; the Federal Capital Territory, FCT; Federal Airport Authority of Nigeria, FAAN; Nigerian Communications Commission, NCC; and Nigerian Broadcasting Commission, NBC.
Others are West African Examination Council, WAEC; National Sports Commission, NSC; Standards Organization of Nigeria, SON; Federal Road Safety Commission, FRSC; Federal Housing Authority, FHA; Nigeria Shippers Council, NSC; Nigeria Deposit Insurance Corporation, NDIC; Nigerian Airspace Management Agency, NAMA; Industrial Training Fund, ITF; Corporate Affairs Commission, CAC; Bank of Industry, BoI; and Joint Admissions and Matriculation Board, JAMB.
Only NNPC and its subsidiaries generated N6.132trn between 2009 and 2011 as internally generated revenue (IGR), and remitted no part of it to the Federal government and this even excluded what was generated from the sales of crude oil and gas.
Another investigation by a national daily, Punch also alleged that over N5 trillion of government funds have been stolen through fraud, embezzlement and theft since President Jonathan assumed office on May 6, 2010.
The amount according to the paper is the summation of government funds said to have been stolen, according to the Nuhu Ribadu-led Petroleum Task Force report; the Minister of Trade and Investment’s report on stolen crude; the House of Representatives fuel subsidy report and investigations into the ecological fund, SIM card registration and frequency band spectrum sale.
The investigation revealed the fraudulent activities carried out on a large scale in some ministries. The Ribadu report on the oil and gas sector for instance, put daily crude oil theft at a high 250,000 barrels daily at a cost of $6.3bn (N1.2trn) a year. This puts the total amount lost through oil theft in the two years of Jonathan’s government at over $12.6bn (N2trn).
Another fraud scheme was discovered in July 2012 when the House of Representatives Committee on Environment discovered a tree seedling fraud worth N2bn awarded by the Ecological Fund office.
Similarly, in the telecommunications sector, the 450MHz frequency, which was valued at over $50m, was allegedly sold for less than $6m (a difference of $44m or N6.9bn) by the Nigeria Communications Commission. In the same sector, the reps, earlier this year, commenced investigations into the N6.1bn SIM card registration project embarked upon by the NCC in 2011.

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