The House of Representatives yesterday declared Nigeria’s excess crude account illegal and in clear breach of the constitution that provides for all government’s funds to be remitted to the country’s consolidated federation account.
Also, the House declared its intention to reduce the recurrent expenditure and increase the capital expenditure contained in the recently presented 2013 budget estimates.
“We are looking at the recurrent expenditure that is higher than the capital expenditure; it might not allow the budget to work well,” said House spokesman Zakari Mohammed. “We will begin to look at the reversal of that because a working budget should be more of capital projects to be executed as against the recurrent that have little impact in the infrastructural development of the country.”
The House disclosed that it will take advantage of the ongoing constitution amendment process to scrap the account which, it insists, is in violation of Section 80 (1,2,3) of the 1999 Constitution (as amended).
Hon. Zakari Mohammed spoke while briefing newsmen on the state of affairs of the House in view of the faceoff between the legislature and the executive on the oil benchmark for the 2013 budget.
The minister of state for finance, Yerima Lawan Ngama, last week disclosed that the excess crude account had risen to about $8.4 billion. The account, used to save oil revenues above a base amount derived from a defined benchmark price, was established in 2004 and its objective is primarily to protect planned budgets against shortfalls due to volatile crude oil prices.
Mohammed said:”For us, the benchmark should be $80 per barrel and it is simple. Our calculation is why make it $75 and bring in money to the excess crude account which is illegal and share to the three tiers of government?
“Most of the time, the excess crude has not been properly applied. Why keep money for certain people to misapply? We are saying, at $80 per barrel, whatever is the difference or $5 can be used to service domestic debt. In the last two years, how has the account bettered our lot?
“It is a constitutional provision that all revenues accruable to the federal government should go to the consolidated account. I think the excess crude account is ‘bring the money let us share it’. Because somebody somewhere is profiteering from that arrangement, they will not want it to die. For us we will be focused and we will keep fighting it. We will take advantage of the amendment of the constitution to take care of some of these grey areas.”