The Capital Market Academics of Nigeria has commended President Bola Tinubu’s Executive Order for direct remittance of oil and gas revenue to the Federation Account.
CMAN’s president, Uche Uwaleke, said this in a statement on Thursday. Mr Uwaleke described the decision as one of the most courageous reforms of Tinubu’s administration.
He said the move was a step towards strengthening fiscal transparency and achieving equitable revenue distribution, ensuring that all tiers of government benefited equitably from the country’s oil and gas wealth.
Mr Uwaleke described the development as a victory for the Federation Accounts Allocation Committee and for fiscal justice in the country.
According to him, it will significantly boost revenues available to all tiers of government, thereby enhancing their capacity to deliver services to the people, generate economic activities and boost the capital markets.
”Since 2021, when the Petroleum Industry Act was implemented, the Federation Account shared by the federal, state, and local governments has received only 40 per cent of these proceeds.
”While the Nigerian National Petroleum Company Ltd retained 60 per cent through the Frontier Exploration Fund (30 per cent) under their expenditure oversight and a management fee of 30 per cent.
”This imbalance undermined the principle of collective ownership of national resources. By correcting this anomaly, the president has ensured that all tiers of government benefit equitably from the nation’s oil and gas wealth,” he said.
Mr Uwaleke suggested that the reform process must continue, particularly with regard to the joint venture assets, noting that it should also be returned to the Federation Account.
He called on all stakeholders to support the president’s reform agenda.
Mr Uwaleke said the association remained committed to advocating for policies that strengthened transparency, accountability, and fairness in the management of the country’s resources.
He restated the importance of including the chairman of the Revenue Mobilisation, Allocation and Fiscal Commission on the Committee overseeing the implementation of the order to ensure transparency and accountability.
Mr Tinubu on Wednesday issued the Executive Order to safeguard and enhance revenues, curb wasteful spending, and eliminate duplicative structures in the sector.
The president said the directive sought to restore the constitutional revenue entitlements of the three tiers of government, which were removed in 2021 by the Petroleum Industry Act.
He said the PIA created structural and legal channels through which substantial Federation revenues were lost through deductions, charges and fees.
Under the current PIA framework, NNPCL retains 30 per cent of the federation’s oil revenues as a management fee on profit oil and profit gas. The president said the company also retained 20 per cent of its profits to cover working capital and future investments.
Mr Tinubu noted that the order introduced immediate measures to curb leakages, enhance transparency, and reposition NNPCL as a strictly commercial enterprise.
He said the reforms were urgent given their implications for national budgeting, debt sustainability and economic stability.
Mr Tinubu said his administration would also undertake a comprehensive review of the PIA in consultation with stakeholders.
(NAN)