What have the governors achieved with continual increased FAAC allocations?, by Kola Amzat

No doubt, there is a new dawn in the FAAC allocation to all the three (3) tiers of government, as allocation has increased substantially in the last 8 months at the behest of president.

But, to what use have the states government put the continual increased allocations?

To clear all the doubts, it’s important to chronicle the allocations credited to the states between March to August 2024, and make a comparison with the same periods in the preceding year.

N366.95 billion, N398.69 billion, N493.40 billion, N388.42 billion, N473.5 billion, and N422.86 billion were allocated to states in March, April, May, June, July and August 2024 respectively, all totaling N2.544 trillion in those six (6) months.

In the same vein, N236.94 billion, N232.13 billion, N290.71 billion, N299.92 billion, N295.95 billion and N319.52 billion were allocated to the states during the months of March, April, May, June, July and August 2023 respectively, all aggregating to ₦1.675.17 trillion for the six (6) months under review. 

From the above data, there was an increase of FAAC allocation between those period under review–March-August 2024 and March-August 2023 by a whopping ₦868.66 billion, representing about 52% increase just within 6 months and still counting.

For the avoidance of doubt, the sources of revenues to FAAC accounts remain VAT, Electronic Money Transfer Levies (EMTL), Exchange Difference Revenue, Solid Mineral Revenue, Oil & Gas Royalty, Petroleum Profit Tax (PPT), Import Duty, Ecological and Mining Tax and more importantly, funds that ought to have been disbursed to PETROLEUM SUBSIDY.  

Meanwhile, the significant increase in the allocation precisely from February 2024 at the instance of the president is purposed to drive developments in all the facets at the state and the local government levels.

At a difficult and very challenging time like this, the state authorities are expected to deploy the increased allocations for the following purposes:

Significantly improve the infrastructural facilities in the primary and secondary schools within their respective states with a view to making public schools competitive and more importantly, attractive to millions of parents across the country, with the resultant effect that the parents repose trust and confidence in the quality of education their children are exposed to.

Completely overhauling the states’ transportation system, with particular reference to rehabilitating the existing roads, and possibly construct new road networks, as well as acquire fleet of buses, all in the efforts to making the effects of subsidy removal pale into insignificance. 

In the states with rail and water transportation system, the governors are also expected to deploy proportional part of allocation to ensure these transport systems are face-lifted with a view to complementing the road transport.

The governors are also expected to significantly complement the efforts of federal government with respect to food security, by acquiring agricultural equipment and inputs to distribute to farmers in their respective states, as well as provide incentives for farmers, all in efforts to make the food abundant and at affordable prices for generality of Nigerians.

With the increased in FAAC allocation, the state governments are equally expected to involve hugely in providing security in their domains in order to complement the valiant efforts of federal government.

In addition, the governors are also to embark on building and construction of low and medium housing units that would provide succor for the middle class and downtrodden.

Through the increased FAAC allocation, the state governments are well expected to establish myriads of social investment interventions that would attend to the needs of all categories of Nigerians in their federating units.

But, what do we see across the land?

But, what have been the state of development and infrastructures across the states?

 It’s practically been status quo!

Nothing significant to justify the continuous increased FAAC allocation in all the states, except in FCT, where the minister is causing developmental strides in all sectors.

Majorly, it’s only the efforts of federal ministries and agencies that are been noticed across the states.

And, in a country with diverse population of more than 220 million people and with more than 300 ethnic groups, this development would amount to absolutely nothing.

This is why there is preponderance of millions of people wallowing in abject poverty across the land!

This is why there is hopelessness and despondence across the country!

This is why the teeming youths are relocating abroad in their hundreds!

This is why there is exponential increase in criminalities, in form of banditry, kidnapping, insurgence, drug-peddling, armed-robbery etc!

Of course, governors are culpable, as they’ve not justified the trust and confidence reposed on them by the president, at whose instance the new regime of FAAC allocations came manifestation!

It’s instructive to remind the governors that it’s incumbent on them to support the spirited efforts of the president who is religiously and assiduously working round the clock to reposition, re-fix and reengineer all Nigerian developmental facets.

Ours is a presidential system.

President would do his own at the federal level, while the onus is on them to collaborative with him in all gamut to ensure development and prosperity across the country.    

Kola AMZAT (FCA, FCIB)

Lagos based Financial & Management Consultants,

09077509348.