The Excess Crude Account, Nigeria's local reserve for the rainy day, may be exhausted in the next two years if the Federal Government, 36 States and the Federal Capital Territory (FCT) continue to fall back on it to augment the nation's dwindling oil revenue.
The nation's dwindling fortunes are the result of the global economic meltdown, the shortfalls in the non-oil revenue sector, massive shut down of oil production as a result of the Niger Delta crisis as well as the production limitations of the Organisation of Petroleum Exporting Countries (OPEC).
Minister of Finance, Dr. Mansur Muhtar, raised the alert yesterday at an interactive session with the House of Representatives Committee on Legislative Compliance. Muhtar explained that given the current revenue constraints on several fronts, the Federal Government had for several months relied on the funds that accrued to the said account, more so when there was an existing Memorandum of Understanding (MoU) between it and the State Governors to do so.
He disclosed that apart from the dwindling oil revenue, the Nigeria Customs and Excise and the Federal Inland Revenue Service (FIRS), two major agencies from which Nigeria derived the bulk of non-oil revenue had also suffered dwindling revenue .
In the current year, he said, Nigeria Customs Service has so far recorded a revenue shortfall of 48.5 per cent while revenue accruing to the Federal Government through the FIRS had witnessed a crash of about 30 per cent.
The Minister of Finance however allayed the fears of the Legislature on preparations for next year's budget, assuring that the process of preparing the Medium Term Expenditure Framework(MTEF) in readiness for the 2010 Appropriation Bill had reached an advanced stage.
Chairman of the House Committee on Legislative Compliance, Honourable Daemi Akpanah, had in the course of the interaction sought to know if the Federal Government was managing the Excess Crude Account in line with the stipulations of the Fiscal Responsibility Act. The House Committee was also probing the seeming delay by the Ministry of Finance to comply with critical provisions of the Fiscal Responsibility Act which requires the Minister to present a MTEF to the Federal Executive Council and the National Assembly before the end of the second quarter of any given year.
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