FAAC disbursement jump 101% to N2.07 trillion in one year

The Federation Account Allocation Committee (FAAC) disbursed the sum of N2.07 trillion to the three tiers of government in February 2024 from the total revenue generated in January, according to the National Bureau of Statistics report.

The total disbursement represents a 101% upsurge of over N1 trillion, compared to the same period in the previous year.

February 2023, the total disbursement amounted to N1.03 trillion, comprising N653.70 billion from the Statutory Account, N115.00 billion from the Non-Oil Excess Account, N13.80 billion from the Electronic Money Transfer Levy (EMTL), and N250.01 billion from the Value Added Tax (VAT).

The Federal Government received N285.24 billion, while state and local governments received N248.98 billion and N183.23 billion, respectively. Additionally, N32.73 billion was shared among oil-producing states from the 13% derivation fund.

Moving to February 2024, FAAC reported an increase in disbursement, the total reaching N2.07 trillion. This amount comprised N1.15 trillion from the Statutory Account, N479.03 billion from Exchange Gain, N16.59 million from Electronic Money Transfer Levy (EMTL), and N420.73 billion from Value Added Tax (VAT).

The sum of N85.10 billion was allocated to oil-producing states from the 13% derivation fund.

Recent reports by BusinessDay highlighted that some governments often converted portions of the funds received from FAAC into dollars at the parallel market, which exerted additional pressure on the naira.

The activities of these governments post-FAAC disbursement contributed to the depreciation of the national currency, according to data and interviews with sources familiar with the matter.