Akwa Ibom State

Why Akwa Ibom State Govt. Must Come Clean On 2021 Exceptional Income — Policy Alert

UYOUYO, NIGERIA — Policy Alert, a Civil Society Organisation promoting fiscal and ecological justice in the Niger Delta, has called on the Akwa Ibom State Government to provide details on where the state government got N171.2 billion and N12.18 billion it received as exceptional income during the third quarter and fourth quarter of 2021.

The call was made by the organisation’s Executive Director, Tijah Bolton-Akpan, on the heels of Governor Udom Emmanuel’s denial, weekend, that the State had received any payments from the federal government in 2021 as refunds of 13 percent derivation.

Responding to questions during the media interaction “The Governor Speaks”, Governor Emmanuel had said, “From 2018, there has not been any further refund from the Federal Government. I don’t know if people are counting the court judgment on the 13 percent derivation arrears which has not yet been implemented. Even then, people need to ask how much we were earning as 13 percent derivation as of then. When the issue was brought to the Federal Executive Council, they said they will pay it in five years.”

It could be recalled that on November 1, 2021, Policy Alert had issued a statement that the Akwa Ibom State Government had received N171.2 billion as thirteen percent derivation arrears during the third quarter of the year, linking the payment to a series of court judgments in favour of four Niger Delta states on arrears of derivation payments from Production Sharing Contracts. Weeks later, the organisation also called on the benefiting states to resist the temptation of using the refund judgment as a guarantee for commercial bank loans.

According to Policy Alert’s Executive Director, the denial by the governor is surprising as financial documents published by the state government confirmed the payments as stated.

Bolton-Akpan said, “We stand by our earlier position that the state government had received such payments as 13 percent derivation. This was confirmed in the 2021 third-quarter budget appraisal report published by the Akwa Ibom State Government which clearly indicates that the state received N171.2 billion under ‘Other exceptional income: 13 percent derivation revenue arrears’.

“We also use this opportunity to inform the public that in the fourth-quarter, the state received a further N12.81 billion refund as derivation arrears, bringing exceptional income received under this heading in 2021 to a total of N184.05 billion.

“It was apparently in expectation of these payments that the state revised its expected revenue on this budget item from N61.10 billion to N193 billion in September 2021.”

He added, “It is therefore not just curious but potentially misleading to publicly deny that the state has received these funds despite documentary evidence to the contrary. This is indeed a red flag and suggests that something is amiss. Fiscal openness goes beyond publishing what we spend public funds on.

“We must also be transparent and accountable on the sources of these funds. It is expedient for the State Government to come clean on the true source of the N184.05 billion exceptional income in 2021 if it is not derivation refunds as captured in the state’s fiscal documents.”

He called on accountability institutions especially the Office of the Auditor-General and the State House of Assembly to further investigate the issue.