The total monthly payout by the Federation Account Allocation Committee (FAAC) to the three tiers of government decreased by N90bn to N420bn (US$1.38bn) in October (from September revenues). It therefore falls back below the forecast pro rata monthly average of N477bn per the 2016 budget, which projects the net distribution from the federation account and the VAT pool combined at N5.72trn, for the first time in four months. We note a trend of substantial data revisions once they appear on official websites.
The three previous distributions were boosted by the impact of the devaluation on 20 June. Both petroleum receipts based upon the US dollar price and customs revenues benefited from the adjustment.
The federal finance minister, Kemi Adeosun, was quoted after the latest FAAC meeting as highlighting the state of force majeure at the Bonny terminal and the “subsisting” force majeure at the Forcados terminal. Non-mineral revenue also disappointed in September.
Adeosun put the excess crude account (ECA) balance at US$2.45bn. This compromises part of official reserves, which amounted to US$23.91bn as at 21 October.
The statutory distribution of N251bn was supplemented by excess petroleum tax payments of N63bn, an exchange-rate gain of N41bn, the regular NNPC “refund” of N6bn and VAT.
We have taken the data for the two latest payouts from the local media and caution that there may be some inconsistencies between different accounts. The federal finance ministry provides the revenue numbers up to July, distributed in August.