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13% derivation fetches oil producing states N602bn in 16 months

Despite claims of neglect, oil producing states in the country received N602.37 billion as their 13 percent derivation fund from the Federal Government between January 2017 and April 2018, analysis by business a.m. has shown.

The oil producing states are Akwa-Ibom, Rivers, Delta, Cross River, Edo, Bayelsa, Abia, Ondo, Imo, Anambra, and of recent, Lagos State.

Revenue allocation in Nigeria has been one of the most intractable and controversial issues particularly the `principle of derivation’ which has been highly contentious in the country’s fiscal federalism since oil discovery in 1958.

The derivation principle seeks to allocate natural resource revenues accruable to the federation’s account on the basis that is perceived to be equitable, given particular consideration to the resource-producing states and regions.

Since its introduction, the percentage revenue due to producing states has declined from the initial 50 percent share to one percent in the 1990s, and subsequently was increased again to the current 13 percent share.

This has been considered unfair and unacceptable by the producing states especially Akwa-Ibom and Ondo states whose oil is virtually 100 percent offshore, which technically limits their benefits from the principle of derivation.

This has resulted to the agitations by these states for equitable share of their natural endowment for effective development.

Specifically, the highest allocation of N57.49 billion was shared among the oil producing states as 13 percent derivation fund in March, 2018, while the lowest allocation was N3.08 billion in March, 2017.

A breakdown of the report by the Federal Account Allocation Committee, (FAAC) shows that in January 2017, the sum of N26.83 billion was shared, N34.11 billion in February and N3.80 billion in march.

Further analysis showed that in April, May, June, July and August, 2017, the sum of N35.75 billion, N29.94 billion, N26.96 billion, N29.89 billion, and N31.59 billion was shared, respectively, among the states.

Also, in September, N41.97 billion was shared, while N40.22bn was shared in October. November and December had N40.85 billion, N43.21 billion respectively.

Meanwhile, due to the steady increase of oil prices, there was an increase in the allocation to the oil producing states.

Between January and April, 2018, the oil producing states shared N217.25 billion.

Specifically, in January 2018, the sum of N51.74 billion was shared, in February, the sum of N52.04 billion, while in March, the highest allocation for the period under review was shared with the sum of N57.49 billion, while there was a drop in April to the tune of N55.98 billion.

It could be recalled that some time ago, the leadership of Oil and Gas Producing Communities of Nigeria had alleged that the governors of the states had embezzled over N8.1trillion between 2000 to June 2013 to the detriment of poverty-stricken oil producing communities.

Industry observers who spoke with business a.m. argued that the 13 percent derivation fund has become the highest fraud for the nine benefiting states of Ondo, Edo, Delta, Bayelsa, Rivers, Akwa/Ibom, Cross-Rivers, Imo and Abia and, recently, Lagos.

“There is no evidence on ground to show for the huge allocations over the years,” they said.

Moses Ojo, an analyst at Pan African Capital plc said the drop in March allocation could be attributed to possible shutdown in production of some oil companies adding that this would also reflect on the allocation to the three tiers of government in the month.

“We need to know the total amount that was shared by the three tiers of government in March. You will discover that it will al

so be low as well which was the reason for the low allocation,” Ojo said.

“It is either there was a major shutdown in production by oil producing companies. It can’t be attributed to price because there was no serious price crisis in the month.

“For instance, what will be shared for the months of June and July will likely be low. There must be shutdown among the oil companies probably as a result of repair. This made the production go down and that affected the proceeds shared,” he further explained

Graphic: Two killed in fresh cult war in Lagos

Two suspected cult members were killed as viral members of the secret cults attacked themselves at Imalete Alafia and Igbojiya communities in Ibeju-Lekki Local Government Area of Lagos state on Sunday April 22nd. This attack comes barely a week after three suspected cultists were beheaded after their members clashed in Lagos. According to reports, one of the suspected cultists identified as Focus, was killed and mutilated by the group about 10a.m. yesterday at Igbojiya community. Focus, who is said to be a member of Eye confraternity, sat at a joint where a security man guarding one of the houses, sold cooked noodles, bread and egg. He was seated with the man waiting for his egg and bread when the cult members circled him and shot him. However, the gunshots had no effect on him, so the cult boys attacked him with machetes and axes as he tried to escape. He became weak, having received severe cuts on his skull, neck and several parts of the body. He died near a popular spot in the community. The cult members also killed another person in the neighboring Imalete Alafia town. Prior to the latest cult killings, one person was butchered in like manner on Saturday at Imalete Alafia.

Phyno Loses $1000 To Deejay J Masta Over A Bet

Video: Top Nigerian Indigenous rapper Phyno losses his whooping 1000$ to his official Disc Jockey known as Deejay J Masta after betting on Manchester united and Barcelona match

OSINBAJO: I'VE GONE TO SUPREME COURT 12 TIMES TO FIGHT FOR RESTRUCTURING.

                 

"Let me explain my position clearly. I am not just an advocate of restructuring, there is no other government in Nigeria that has actively pursued restructuring such as we did when I was attorney general in Lagos state.

“People talking about restructuring, if you ask them what they meant by restructuring? They won’t even know what it means and that is the problem we have to face.”

“We started with fiscal restructuring, which is more of resource control. Should states control their own resources? We went to the supreme court. They argued that each state should control its own resources.

“The states that argued in favour of autonomy for states to control their resources were the oil producing states in the country and Lagos State, while some others argued on the other side because they want to share oil money.

“We lost at the supreme court. The supreme court said no, that you cannot control your resources. If you are an oil producing state, take 13 percent extra, which is derivation.”

He said Lagos further argued that it had ports that served the entire nation, so the state should also take 13 percent derivation which the supreme court objected.

Osinbajo said that further argument led to the introduction of onshore and offshore law, which enabled the state to share from onshore resources.

“All this time, this was 2000, some of those people, including the presidential candidate of PDP, who is talking about restructuring, was the vice president then,” he said.

“They opposed every step we took. Of course, we were about  taking the federal government to court then. They opposed every step.

“The next thing we did was that the states should be able to create their own local governments, which is autonomy of states.

“So, we created 37 new local governments in Lagos. The president then, Chief Obasanjo, seized our local government funds and said we could not create new local governments.

“If you ask those people now talking about restructuring, none of them has done anything compared to what we have done. So, I am not a latter-day convert to restructuring.

“I am an active practitioner of restructuring, and I have gone to the supreme court 12 times to test restructuring.”

Via Liberty Badmus

FG announces plan to borrow $300m to eliminate malaria

The Federal Government is to secure a US$300 million from the World Bank, Islamic Development Bankand African Development Bank to eliminate malaria in the country.  

This is contained in a statement issued by the African Leaders Malaria Alliance (ALMA) on the Commonwealth Heads of Government Meeting 2018 just ended in London. The government said in the statement that it would elevate malaria on the national priority list and finance its national malaria elimination strategy.  

The statement said Nigeria also pledged an additional US$18.7 million to leverage US$37 million from the Global Fund to distribute 15 million mosquito nets and to support the local manufacture of essential malaria commodities.  It said that ALMA applauds the commitment by 53 Commonwealth leaders to halve malaria across the Commonwealth nations within the next five years. It said the game-changing commitment followed the Malaria Summit, where leaders from malaria-affected countries, businesses, donors and Commonwealth leaders to get ready to beat the scourge of malaria.  

The statement said the commitment from the Commonwealth has the potential to prevent 350 million malaria cases and save 650,000 lives.  It added 90 per cent of global malaria cases and deaths occur on the African continent and the impact of this renewed focus to eliminate malaria will be felt across the continent. The statement noted that apart from the commitment from Nigeria, 11 African countries in the Commonwealth announced new commitment and affirmed their determination to eliminate malaria.  It enumerated the countries to include Ghana, Kenya, Malawi, Mozambique, Namibia, United Republic of Tanzania, The Gambia, Uganda, Rwanda and Zambia. The statement added that ALMA further committed to the African Union’s (AU) Catalytic Framework to end AIDS, TB and Eliminate Malaria by 2030.  

Besides, it said that the AU was also committed to supporting member countries to introduce and strengthen the use of national and sub-national malaria scorecards and action trackers, with robust community engagement to support increased domestic funding. According to the statement, AU will continue its work with Heads of State and Government in Africa to monitor progress towards this goal.  

“Additional commitments from the international community includes the UK Government’s commitment to spend £500 million a year through 2020-2021 and an extra £100 million commitment to the Global Fund. The Bill and Melinda Gates Foundation also announced an additional US$1 billion through 2023 to fund research and development to reduce the burden of malaria. In addition, the Bill and Melinda Gates Foundation pledged £50 million in matching funds against the UK Government’s additional £100 commitment to the Global Fund,’’it said. 

Savage! Harvard University uses Nigeria as a case study of a failed African country (Photo)

Once again. Nigeria has been 'disgraced' internationally after Harvard University gave to its students an assignment in which Nigeria was used as a case study of a failed African country.

The question Harvard University gave its students reads;

Africa is growing. Seven of the the ten fastest growing economies in the world are in Africa, and the continent's largest economies are becoming less dependent on extractive commodities. The continent's rising middle class has demonstrated a taste for consumer goods and technological innovation, and Africa's population-currently more than a billion people- is booming and overwhelmingly young at a time when populations in other regions are shrinking and aging.

Nigeria, sub-saharan Africa's largest economy, epitomizes both the promise and the problems the continent faces in the 21st century. The contry had failed to thrive for its first thirty years as an independent nation, despite having a developmental head start relative to countries like China and India, as well as hundreds of billions of dollars in oil revenue.. Now, after pathbreaking reforms followed by signs of retrenchment, Nigeria's new President faced both vast opportunity and grave challenges. Would the country flourish or founder in this new era? We will analyze key reforms in Nigeria's economy, significant political developments, and the choices facing the country's fast-growing private sector.

Why did Nigeria fail to thrive between 1960 and 1999, particularly relative to China and India?

How would you characterize former President Obasanjo's legacy?

Are you bullish or bearish on the next fifteen years for Nigeria? What would make you change your mind? What opportunities do you see? What are the challenges (and risks)

Governor El-Rufai threatens to sue twitter user, says address of the twitter user is being traced

Yesterday, the Kaduna State Independent Electoral Commission KADSIECOM, went up in flames. A twitter user, @realKefason, tweeted about the fire outbreak and alleged that the state governor, Nasir El-Rufai, who doesn't want the state local government elections to hold next month, was behind the fire outbreak.

In his response, Governor El-Rufai threatened to sue the twitter user and asked him to provide proof he was behind the fire incident. According to Governor El-Rufai, the twitter user's address is being traced. Read their exchanges below

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Photos: Man accidentally sparks wildfire in canary Islands after lighting "toilet paper"

Photo: Explosion rocks Central Mosque in Kano, many feared dead

There was an explosion at the Central Mosque in Kano this afternoon as Muslim faithfuls were holding their Friday Jumat service. It's the same Mosque where Emir of Kano, Sanusi Lamido usually leads prayers but he wasn't there this afternoon. Many are feared dead. Details later....