President Goodluck Jonathan-led Federal Government
over illegal deduction of one per cent from statutory
allocation to states in the federation.
The governor disclosed this on Monday while
presenting the nation's grim financial standing
before members of the State House of Assembly in
Lagos, western Nigeria.
The governor said the decline in revenue was also
credited to decline in oil production, which was
adduced to pipeline vandalism and crude oil theft
and that the debate on accounting on crude oil is out
there.
Fashola lamented that since October last year the
Federal Government had been deducting one per
cent from states' statutory allocations which was said
to be for police reform, describing it as
unconstitutional and vowed to challenge it in court.
He said he was told that the National Economic
Council took the decision but stressed that despite
this, he believed that it is an unconstitutional
decision.
Fashola stated that he had written the Federal
Government to complain about his opposition to the
decision and that the state is heading to the court
since he did not receive any reply to his letter,
stressing that "the Economic Council has no such
powers."
He also complained that the Nigerian National
Petroleum Corporation, NNPC, under-remitted the
sum of N2.4 trillion to the federation account, saying
that the situation meant that no state of the
federation would be able to meet its target for the
year 2014 as the 36 states are reeling in serious
financial constraint.
The fact, according to the governor, is that for the
first time in almost 15 years of the nation's
democratic experience, the country recorded some
walk-outs staged by Commissioners of Finance
during meetings of the Federal Accounts Allocation
Committee in Abuja, the country's capital.
He said the first one happened in 2011, while the
country witnessed more of such walkouts last year
due to irreconcilable accounts of the federation,
saying that as a result some states have had, in the
recent past, to borrow to keep the government going.
"The reasons for those disagreements were largely
reported revenue declines that were disputed by the
various states as represented by their various
Finance Commissioners," he said, adding that this
pattern had continued right from the second half of
last year to January this year.
"The only bleep of stability is the last FAAC meeting
in February. Now whilst this revenue decline has
gone up, we have been unable to hold the National
Economic Council, NEC, meeting in Abuja. In the
past, the meetings had held every month. The
meeting has not been held now for, at least, six
months in spite of clear revenue declines," he said.
He described the council as an organ for the
discussion of economic issues concerning the 36
states of the country and comprised governors, the
Governor of the Central Bank, the ministers of
National Planning, Finance and others. The meeting
is chaired by the Vice President, Namadi Sambo.
The governor said the revenue decline should have
been a major issue for discussion at the NEC meeting
since the constitution of the country provided for it,
reminding the House that he had always complained
of decline in revenue and the inability of the state to
meet optimal budget performances since sometimes,
the government had left social services just to meet
welfare needs of personnel.
He said the revenue declines were credited to "what
is characterised as uncoordinated and discretionary
application of the federal government's fiscal policy
on waiver and negotiating the duty credit
certificates," adding that this was the reason, the
Nigerian Customs Service only generated 47.8 per
cent of its 2013 budget as reported to FAAC.
Giving further reasons for the decline in revenue, he
said he complained about the reported under-
remittance of funds by the Nigerian National
Petroleum Corporation, NNPC, as seen from the
report of FAAC which was presented to him by the
state Commissioner of Finance, Ayo Gbeleyi.
"From the slide which I have here showing
remittances on monthly bases to the states, and to
the local governments in Lagos, NNPC has clearly
refunded monies under item 13, made some refund
across the months from February last year.
"So, if NNPC didn't withhold money from the
federation accounts, then why is she (Minister of
Finance) making refunds? That is the question that I
ask," he said adding that the revenue decline had
affected Lagos State's policy and developmental
objectives as the severity of this challenge varies
from state to state," he said.
Sent From David Aniemeka
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