The Akwa Ibom State Government is expected to receive in 2024 fiscal year the sum of N51 billion from the federation account as arrears of 13 per cent oil derivation fund.
The figure, which is contained in the state’s 2024 budget, is one of the projected revenue sources for the funding of the budget.
Other funding sources for the budget as projected by the state government include N55 billion from statutory revenue from the federation account and N280 billion from oil derivation fund.
Governor Eno last month signed into law the N849 billion budget. Of the figure, N490 billion is for capital expenditure while N359 billion is for recurrent expenditure.
PREMIUM TIMES’s review of the Akwa Ibom budgets for the past two years – 2023 and 2022 – revealed that this is the first time that arrears of 13 per cent derivation owed the state is clearly reflected in the budget.
The oil derivation arrears was only reflected in the state’s 2021 budget – N61 billion was initially captured but was later increased to N193 billion in the revised 2021 budget.
A further review of the 2023 and 2022 budgets of the state revealed the oil derivation arrears may have been lumped up with other revenue sources under a sub-head called “Other statutory allocation.”
Governors in Nigeria’s Niger Delta region came under pressure in November 2022 after the then Governor of Rivers State, Nyesom Wike, disclosed that his administration was using his state’s share of the oil derivation fund arrears paid by President Muhammadu Buhari-led federal government to implement several multi-billion naira projects in the oil-rich state.
After much criticism and pressure from the public, other states in the region, including Akwa Ibom, Delta, Bayelsa and Edo, confirmed the receipt of the money from the federal government.
The Akwa Ibom State Government through its Commissioner for Finance, Linus Nkan admitted the receipt of N186 billion as arrears of the oil money between 2021 and third quarter of 2022, this newspaper reported.
The finance commissioner had in a press briefing in Uyo, said the state government received N160 billion as derivation arrears in 2021 alone.
Mr Nkan, who is still occupying the same office under the present administration, had said that N41.1 billion and N100 billion were estimated as derivation arrears in the 2022 and 2023 budgets respectively.
But findings by this newspaper shows no such sub-head – “derivation arrears” – exists in the said budgets, except in the 2024 budget.
The N51 billion as captured in Akwa Ibom State 2024 budget is a refund of arrears of the 13 per cent oil derivation fund from the federation account.
The refunds, which accumulated from 1999 to 2021, were paid to the nine oil-producing states of Abia, Akwa Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo and Rivers.
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Budget 2024: Akwa Ibom Govt To Receive N51 Billion As Arrears Of Oil Derivation Fund
