Bayelsa State has alleged the Federal Government of illegally deducting four per cent as fuel subsidy from its monthly allocation amounting to over N450bn in the last 13 years.
The Commissioner for Finance, Mr. Maxwell Ebibai, who spoke in Yenagoa, the state capital, during the transparency briefing for August 2019, said other states suffered the same fate.
Ebibai said the deduction, which started in 2006 following the debt relief granted to the Paris Club, was made without the approval of the Council of States.
He explained that the fuel subsidy was being deducted from the 13 per cent derivation with adverse effects on the economy of the states in the South South region.
Ebibai said that the Federal Government made withdrawals from the Excess Crude Account to fund petroleum subsidy, arms purchase and other activities, which had no direct bearing to the oil-producing states.
The Finance boss, who said there was an improvement in the state’s allocation for the month of August as against that of July 2019, however noted that the Governors Forum and the Council of States would deliberate on the matter.
He said: “We noticed that there was a bit of improvement with the derivation figure for August compared to July.
“It is important that we highlight that for a long time, under the pretext that we are saving for the rainy day, the Federal Government used monies in the Excess Crude Account for activities such as petroleum subsidy, arms purchase and others.
“Some states are contributing unfairly to those activities where we use that money for things like petroleum subsidy and other so-called critical government expenses that do not relate to the states.
“So that battle has been on. We have managed to reach some consensus as regards that. But if we want to save money in the excess crude account, let the 13 per cent due to the states be given to them.
“So we know we are contributing at par with our colleagues based on what is received.
“By recent calculations, from the 13 per cent derivation money that has passed through the excess crude account that the people of Bayelsa have not enjoyed the benefits amount to about N450b. That is what in the name of one nation we are subsiding.
“This does not affect Bayelsa alone but almost all the oil producing states. We have been on this engagement and have some positive results in the month of August.
“The issue of backlogs is going to be handled as a nation because the monies taken from the account is humongous.
“So the Governors Forum and Council of States will look at the total liability of what has been taken from the excess crude account, the beneficiaries and what they are entitled to and what the federal government is going to do about it.
“It will not happen the same way where the deductions were remitted to the NDDC and it was the Niger Delta states that had to suffer.
“The Finance Commissioners in the Niger Delta states are on one page on this and beyond just getting what should come to us, the battle is for the governors to take up.”
Presenting the financial statement for the month of August, Ebibai said the total inflow from the federation account was N14.5bn, comprising statutory allocation of N3.5bn, derivation N8.6bn among others.
He also announced that the total deductions from the federation account stood at N1.1bn while the net receipts for the month of August were N13.4bn.
He said other receipts for August include IGR of N882million, refund from other sources N1.5bn and local government bailout funds of N16.3million, bringing the total receipts for August to N15.7bn.
Ebibai explained that the state government made a total payment of N7.4bn leaving a net balance of N8.3bn.
He added that out of the amount, N2.6bn was spent on recurrent expenditure while capital payments gulped N5.5bn leaving a balance of N401million.