By Lawrence Olaoye
Minister of Finance, Kemi Adeosun has said that the stalemate at the Federation Accounts Allocation Committee (FAAC) meeting which hindered the sharing of June allocations to states would result in delay of payments of June salaries by many states of the federation.
The minister who briefed newsmen after the monthly National Economic Council (NEC) meeting chaired by the Vice President, Yemi Osinbajo, yesterday, equally revealed that the nation was able to save $80.6 in the Excess Crude Accounts (ECA) making the overall balance currently stand at $1,916,742,289.60.
Delta State governor, Ifeanyi Okowa, who also briefed the newsmen said the Council approved the reports submitted to it by the National Sovereign Investments Authority (NSIA) which indicated progressive profitability.
On the stalemate in the FAAC meeting, Adeosun said, “We operate NNPC as a business. We have invested public capital in that business and we have expectations of return; and when that return falls lower than our expectations, then the owners of this business which, in this case, is the federal government and states, need to act. So, that was what caused the deadlock yesterday; and we really felt the figures the NNPC was proposing for FAAC were unacceptable. We felt that some of the costs couldn’t be justified; and so, we have decided that rather than approve the accounts, we will go back and do further work.”
The minister continued, “So, further negotiations and interactions are going on with NNPC as we speak. However, we did briefed both Mr. President and Mr. Vice President on the deadlock and asked for their support and their forbearance in this, because the consequence of this is that, salaries might well be delayed in many states as a result of this.
“But we feel that in order to get to the accurate figures that we need, we have asked for forbearance; and the governors and the federal government are all in agreement that we need to get to the bottom of those figures.”
On the savings made in the ECA, Adeosun said, “In particular, now that the oil price is now $76 per barrel in the spot market, which means that bonny light is about $78, we want to be aggressively putting money away into the excess crude account. So we are very very conscious that this period, this window of relatively high oil price might not last, and we will like to be able to save. If we cannot get into the federation account, the sort of revenues we are expecting then we will not be able to save.”
She disclosed that the balance Stabilization Accounts was N18,892,864,216.65 while that of Natural Resources Accounts stood at N133,715,427,387.37 respectively.
On the NSIA, Delta State governor, Ifeanyi Okowa said, “At the meeting today, we did take the annual reports and accounts of National Sovereign Investment Authority (NSIA) for the year ended 2016 and an update on 2017 activities.
“The main issue was the NSIA report on five years so far of profitability in all forms with core profits of about N26.28 billion, which is about $88 million in 2016. NSIA also reported that the total profit on that management was about $1.25 billion for most part of the year; but they had received an extra of $250 million that was received in the third quarter of 2017.
“It also did report that the returns on assets were up to 6.6 percent in dollar terms, which we considered to be quite good in terms of returns. It is actually shifting its focus now to infrastructure and direct investment locally in the country, which is of great benefit to us as a nation.”