The Policies And Politics Of Excess Crude Oil Fund

For more than a month, the media has been awash with a brewing constitutional showdown
Over the legality and morality of the withholding by the FG of funds held in the excess crude oil revenue
Account of the federation.

What is the excess crude oil account?

The 1999 CFRN created a consolidated revenue account for the Federation of Nigeria. This account is to be funded from
budgetary allocation as approved by the National assembly or by means of any law enacted for the same purpose by
any act of the National assembly. Therefore every year, the National assembly enacts an appropriation Act which the
uninitiated call the budget. This act sets the benchmark prices for the primary source of government income for every year.
In setting this benchmark, the presidency and the N. Assembly are generally conservative and cautious, so the price is usually off the previous year’s highest price by as much as 50 dollars a barrel.

As a contingency net, the NA created the excess crude oil account and directed that all revenue from crude oil above
the budgetary benchmark should be paid into that account. Meanwhile all disbursements to the tiers of government continues to be effected through the consolidated revenue fund of the federation.
For more reading, visit http://www.effikoland.com/blogs/index.php?blog=2  or get a copy of the constitution of the 1999 constitution. See also AG federation Vs AG Abia and ors

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