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17 States Economically Bankrupt -Report …10 States Viable

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The Economic Confidential yesterday released its Annual States Viability Index (ASVI) report.
It showed that 17 States are insolvent as their Internally Generated Revenues (IGR) in 2018 was far below 10% of their receipts from the Federation Account Allocations (FAA) in the same year.
The index declared that without the monthly disbursement from the Federation Account Allocation Committee (FAAC), many states remain unviable, and cannot survive without the federally collected revenue, mostly from the oil sector.
The IGR are generated by states through Pay-As-You-Earn Tax (PAYE), Direct Assessment, Road Taxes and revenues from Ministries, Departments and Agencies (MDAs).
The IGR of the 36 states of the federation totaled N1.1 trillion in 2018 as compared to N931 billion in 2018, an increase of N172 billion.
The report further indicates that the IGR of Lagos State of N382bn is higher than that of 30 States put together whose Internally Generated Revenues are extremely low and poor compared to their allocations from the Federation Account.
Meanwhile, the Federal Capital Territory (FCT) Abuja, which is not a state but the nation’s capital, generated N65bn IGR against N29bn it got from the Federation Account in 2018.
Lagos State remained steadfast in its number one position in IGR with a total revenue generation of N382bn compared to FAA of N260bn which translates to 146% in the twelve months of 2018.
It is followed by Ogun State which generated IGR of N84.55bn compared to FAA of N93bn representing 90%; Rivers with N112bn compared to FAA of N237bn representing 47% and Kwara State with a low receipt from the Federation Account has maintained its impressive IGR by generating N23bn compared to FAA of N81bn representing 28%.
Others with impressive IGR include Edo with IGR of N28bn compared to FAA of N112bn representing 25%; Kano generated N44bn compared to FAA of N183bn representing 24%; Enugu with IGR of N22bn compared to FAA of N92bn representing 23%; Ondo with IGR of N24bn compared to FAA of N108bn representing 22.77%; Kaduna with IGR of N29bn compared to FAA of N131bn representing 22.44% while Delta State earned N58bn IGR against FAA of N285bn representing 20%.
The report noted that ten states with impressive IGR generated N808bn in total, while the remaining states merely generated a total of N295bn in 2018.
While the report provides shocking discoveries, the states with less than 10% IGR have remained 17 as in the previous year 2017.
It added: “The poor states may not stay afloat outside the Federation Account Allocation due to socio-political crises including insurgency, kidnapping, armed-banditry and herdsmen-farmer clashes.
“Other states lack foresight in revenue generation drive coupled with arm-chair governance.
“The states that may not survive without the Federation Account due to poor internal revenue generation are Ebonyi which realized a meagre N6.14bn compared to a total of N76bn it received from the Federation Account Allocation (FAA) in 2018 representing about 7.98%; Bayelsa with IGR of N13.6bn compared to FAA of N192bn representing 7.10%; Taraba N5.96bnbn compared to FAA of N88bn representing 6.77%; Adamawa with IGR of N6.2bn compared to N97bn of FAA representing 6.77% and Borno with IGR of N6.52bn compared to N122bn of FAA representing 5.3% within the period under review.
“The major poor internal revenue earners are Katsina which generated N6.9bn compared to FAA of N138bn representing 5.03%; Yobe N4.48bn compared to FAA of N89bn representing 4.86% and lastly Kebbi N4.88bn IGR compared to FAA of N101bn representing 4.88%.”
The Economic Confidential ASVI further showed that only three states in the entire Northern region have IGR above 20% in comparison to their respective allocations from the Federation Account. They are Kwara, Kano and Kaduna States. Meanwhile seven states in the South recorded over 20% IGR in 2018. They are Lagos, Ogun, Rivers, Edo, Enugu, Ondo and Delta States.
The four Southern states with the poorest Internally Generated Revenue of less than 10% compared to their FAA in 2018 are Akwa Ibom, Ekiti, Ebonyi and Bayelsa. Similarly, 13 Northern States have poorest IGR, namely Benue, Nasarawa, Gombe, Zamfara, Niger, Bauchi, Jigawa, Taraba, Adamawa, Borno, Katsina, Yobe and Kebbi States.

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Court Orders FG To Pay Rivers $1,114,551,610; A’Ibom $2,258,411,586

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The Federal High Court sitting in Abuja and presided over by Hon. Justice Taiwo O. Taiwo has ordered the Federal Government to pay Rivers State $1,114,551,610.00 and Akwa Ibom State $2,258,411,586.00, respectively.
The money is entitlements of Rivers and Akwa Ibom states, based on the subsisting decision of the Supreme Court over production sharing contracts arising from the Deep Offshore and Inland Basin Production Sharing Contracts.
Taiwo delivered the judgment in Suit No: FHC/ABJ/CS/174/2021filed by the Attorney General of Rivers State and Attorney General of Akwa Ibom State against the Attorney General of the Federation.
It would be recalled that in 2016, Rivers, Bayelsa and Akwa Ibom states, through their Attorneys-General, had sued the Federal Government, represented by the Attorney General of the Federation at the Supreme Court in Suit No: SC.964/2016, seeking a declaration that there is a statutory obligation imposed on the Defendant (the Federal Government) pursuant to Section 16(1) of the Deep Offshore Inland Basin Production Sharing Act, Cap.D3 Laws of the Federation of Nigeria 2004, to adjust the share of the Federation in the additional revenue accruing under the Production Sharing Contracts if the price of crude oil at any time exceeds $20.00 per barrel.
The states had asked the court to declare that the failure of the Defendant to accordingly adjust the share of the Government of the Federation in the additional revenue in the Production Sharing Contracts (variously approved by the Defendant) following the increase of price of crude oil in excess of 20.00 per barrel in real terms, constitute a breach of the said Section 16(1) of the Deep Offshore and Inland Basin Production Sharing Contracts Act, and has therefore, affected the total revenue accruing to the Federation, and consequently, the total statutory allocation accruing to the Plaintiffs by virtue of the provisions of Section 162 of the Constitution of the Federal Republic of Nigeria 1999 as amended.
The three oil producing states further prayed the court to issue a consequential order compelling the Defendant to adjust the share of the Government of the Federation in the additional revenue under all the Production Sharing Contracts in Nigeria’s oil industry within the Inland Water Basin Deep Offshore areas as approved by the Defendant from the respective times the price of crude oil exceeded $20.00 per barrel in real terms and to calculate in arrears with effect from August, 2003, and recover and pay immediately all outstanding statutory allocations due and payable to the Plaintiffs arising from the said adjustments.
It would be recalled that at the Supreme Court, the Attorney-General of the Federation opted for an out of court settlement, and consequently, terms of settlement were duly drawn up by the parties and entered as the judgment of the court.
The judgment specifically stated that the reliefs in the amended Originating Summons relating to the larger interest of the Federal Government of Nigeria and the entire citizenry of the Federal Republic of Nigeria shall be diligently implemented.
It was also agreed that the Attorney General of the Federation, working jointly with the Plaintiffs should undertake to immediately set up a body and the necessary mechanism for recovery of all lost revenue accruing to the Federation Account in the past and up till the date of full recovery and accruing in future or an acceptable instalmental payments thereof within 90 days next from the date of execution of these presents or its being made judgment of the court.
Following the judgment of the Supreme Court and in compliance therewith the Attorney General of the Federation, the Defendant, constituted a body to determine the respective liabilities including the amount due to oil mineral producing states as derivation proceeds.
The report of that body stated among others that Rivers and Akwa Ibom states were entitled to $1,114,551,610.00 and $2,258,411,586.00, respectively, as derivation proceeds.
However, Attorney General of the Federation, without recourse to the governments of Rivers and Akwa Ibom states, unilaterally claimed to have settled with International Oil Companies (IOCs).
It was gathered that this unilateral action on the part of the Attorney General of the Federation as the Defendant in the judgment of the Supreme Court that led Rivers and Akwa Ibom states, to fill the suit at the Federal High Court in Abuja.
Based on the suit filed by the state, the Federal High Court presided over by Hon. Justice Taiwo Taiwo, declared that Rivers and Akwa Ibom states were entitled to $1,114,551,610.00 and $2,258,411,586.00, respectively, as derivation proceeds.
The court also awarded a post judgment interest of 10 per cent in favour of the Plaintiffs until the final liquidation of the judgment.

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Declare State Of Emergency On National Assets, Experts Tell Buhari

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Against the backdrop of challenges facing national assets across the country, the Association of Facilities Management Practitioners of Nigeria (AFMPN), has called on President Muhammadu Buhari, to declare state of emergency on public infrastructure.
The call was made by AFMPN President, Collins Osayamwen, in an interview with newsmen, while speaking on the new vista his leadership has opened for the association to play a strategic and critical role as a professional body charged with the responsibility of maintaining and managing public infrastructure if the bill at the National Assembly was passed into law and assented to by Buhari in order for Nigerians to enjoy public assets.
However, Osayamwen pointed out that public infrastructure has not been given the desired attention over the years as a result of not giving recognition to professional facilities managers who government needs to collaborate with to maintain critical national assets worth billions of Naira.
He said, “It is evidently clear that our public infrastructure is in a state of emergency and the government needs to declare a state of emergency in order to rescue our public infrastructure from total collapse.
“The reason for lack of maintenance of our infrastructure is not far-fetched.
“It is because, in Nigeria, the profession that is saddled with the responsibility of looking after the built environment does not exist in the list of professionals that constitute the building team.
“We are seriously concerned about the deplorable state and deficit of public infrastructure in Nigeria. In 2012, the Infrastructure Council of Regulatory Commission (ICRC), alluded that $12billion to $15billion was required annually for the next five to six years to bridge the infrastructure deficit gaps in Nigeria.
“It is worthy of note that if these figures are anything to go by, the situation should have become worse by now, nine years later.”
He also explained that in the built environment, architects are responsible for conceptualisation, design and supervision of the project; the Structural, Mechanical and Electrical Engineers and even the IT engineers are responsible for design and construction of the building systems; the building engineer carries out the physical construction of the building.
“Now, let’s examine the role of these professionals. They all perform a certain function and they leave the site once their assignment is completed. Not even one of the professions listed above is trained to look after the building. Once the building is commissioned, they all leave the site for a new project.
“Unfortunately, all the activities carried out in the building up till the stage of completion is less than 20 per cent of the life cycle cost.
“The remaining on-going activities and cost of over 80 per cent is operations and maintenance cost and activities.
“This critical stage in a building life cycle is often neglected, hence, the poor state of our infrastructure. I cannot overemphasize the role of the facilities management practitioners in managing our built environment,” he stated.
According to him, the main reason Nigeria has not been able to maintain her infrastructure is because “the profession responsible for maintenance is not yet recognised for its strategic role in Nigeria as a profession and Facility Management profession is not recognised as a member of the built environment practitioners.
“Maintenance starts from the design stage of a facility. It requires painstaking planning, scheduling, budgeting, sustainable programme management and implementation of maintenance technologies, and others.
“It takes more than culture to effectively and efficiently maintain a facility. It requires time, money, and experience to maintain infrastructure,” he added.

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Flood Ravages NASS As Senate Confirms New COAS

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There was a downpour in Abuja, the Federal Capital Territory, yesterday morning, leaving several parts of the National Assembly Complex flooded.
The central lobby at the ‘White House’ section of the building, which adjoins the Senate and House of Representatives chambers, was flooded.
Other areas affected include the third and last gate to the premises as well as the road linking the Office of the Secretary to the Government of the Federation to the National Assembly.
The Senate had resumed plenary, yesterday, while the House is to resume on June 28, 2021, as the National Assembly returns from a mid-term break.
At the lobby, workers of the two private firms engaged for cleaning services at the complex were busy mopping the floor while it rained.
Water could be seen dropping from several points on the famous green roof.
Some senators watched as the workers struggle to keep the floor dry.
During the plenary, the Senate confirmed the appointment of Maj-Gen Farouk Yahaya as the new Chief of Army Staff.
The Red Chamber took the decision after the consideration of the report of its Joint Committee on Defence and Army led by Senators Aliyu Wamakko and Ali Ndume.
Earlier, the President of the Senate, Dr Ahmad Lawan, had on June 2, referred the request of President Muhammadu Buhari for Yahaya’s confirmation to the committee.
The Defence Committee, which is chaired by Wamakko, was mandated to be the lead panel to screen the newly appointed Army chief.
Yahaya was appointed to replace Lt-Gen Ibrahim Attahiru, who died in a plane crash with 10 other military officers while on an official trip to Kaduna State, last month.
Until his appointment, Yayaha was the Theatre Commander of Operation Hadin Kai, the counter-insurgency operation in the North-East.
Meanwhile, at the House, the downpour delayed legislative activities as several committees which had scheduled the meetings and hearings for the morning were forced to delay the events, as several workers and guests were said to have been trapped in their vehicles.
For instance, the House Committee on Disabilities, which was to begin an investigative hearing on ‘The Need to Investigate the Alleged Violation of the Discrimination Against Persons with Disabilities (Prohibition) Act by the Federal Airport Authority of Nigeria and Private Airline Operators’ at 11am had to commence the event at about 12:15pm.
Also, the House Committees on Communications; Justice; Information and Culture; and National Security and Intelligence, which were to hold an investigative hearing on the recent ban placed on Twitter by the Federal Government shifted the event from 10am to 1pm.

By: Nneka Amaechi-Nnadi, Abuja

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