Tag federation accounts allocation committee faac

The Federation Accounts Allocation Committee (FAAC) is a committee established by the Nigerian government to allocate revenue generated from the federation account among the three tiers of government in Nigeria, namely the Federal Government, State Governments, and Local Governments.

The FAAC is responsible for distributing the revenue generated from the federation account, which includes revenue from oil and gas production, customs duties, and other sources. The committee is chaired by the Accountant-General of the Federation and has representatives from the Federal Ministry of Finance, Budget and National Planning, the Central Bank of Nigeria, and the National Planning Commission.

The FAAC has the following functions:

  1. To allocate revenue from the federation account among the three tiers of government.
  2. To ensure that the revenue allocated is used for the purposes intended.
  3. To monitor and evaluate the performance of the three tiers of government in the management of the revenue allocated to them.
  4. To identify areas of inefficiency and make recommendations for improvement.

The FAAC has the following accounts:

  1. Federation Account: This account receives revenue from the federation account, which includes revenue from oil and gas production, customs duties, and other sources.
  2. Excess Crude Account: This account receives excess revenue from oil and gas production, which is used to stabilize the economy and provide a buffer against fluctuations in oil prices.
  3. Stabilization Account: This account receives revenue from the federation account and is used to stabilize the economy and provide a buffer against fluctuations in oil prices.
  4. Derivation Account: This account receives revenue from the federation account and is used to fund the development of the oil-producing states.

The FAAC has the following allocation formula:

  1. Federal Government: 52.68%
  2. State Governments: 26.72%
  3. Local Governments: 20.6%

The FAAC also has a committee on the allocation of revenue from the federation account, which is responsible for reviewing and approving the allocation of revenue from the federation account. The committee is composed of representatives from the Federal Ministry of Finance, Budget and National Planning, the Central Bank of Nigeria, and the National Planning Commission.

In conclusion, the Federation Accounts Allocation Committee (FAAC) is a critical committee in Nigeria that is responsible for allocating revenue generated from the federation account among the three tiers of government. The committee plays a crucial role in ensuring that the revenue allocated is used for the purposes intended and that the three tiers of government are able to fund their activities effectively.