RMAFC – Constitutional Committees

Non-Oil and Royalty Committee

The Committee generates and updates field data on all revenue collectors of the Federation Account other than revenues derived directly from sale of crude oil. Such revenues include but not limited to those collected by FIRS such PPT etc, Customs duties and Royalties etc. collected by DPR.

  1. The Committee constantly and at predetermined regular intervals monitors all customs activities and in so doing acquire, analyse and vouch for data from all:
    • Ports and Locations of Customs posts.
    • Where dutiable goods are taxed and collected.
    • All locations where chargeable rates and taxes are determined and collected including industries, and in all cases determine and advise on the efficiency of equipment and collection machinery.
  2. For purpose of Excise Duty – it acquires analyses and maintains up to date records on all industries, commercial companies that pay Excise duties.
  3. FIRS – Relate with FIRS such as to vet, verify and certify, monitor all taxes collected by IRS for the Federation Account.
  4. The Committee treats DPR in the same way it treats FIRS and the Customs establishments in respect of Crude Oil Royalties and other fees (OPL, OML Licenses fees, gas flaring taxes etc) collected by DPR.

Disbursement and Indices Committee

The Committee is involved in acquisition and generation of data, and computation of indices for revenue allocation. The data is in respect of the proxies for horizontal revenue sharing in the case of the Federation Account and both vertical and horizontal revenue sharing in respect of the 13% Derivation Funds.

It also collates field data from O & G Committee and hence generates indices for the disbursement of the derivation funds to:

  1. State Governments based on quantity of oil produced.
  2. Local Governments within each beneficiary State both vertically and horizontally.
  3. Update such indices on quarterly basis taking into account disruptions, stoppage, additional productions etc. for equity, justice and fairness to all.

The main functions of this Committee are:

  • It ensures the correct application of Approved Revenue Formula for disbursements to all beneficiaries to ensure that correct quantity of funds received by each beneficiary is in accordance with the formula.
    For this purpose, it establishes special relationship with: All Tiers of Governments, Federal Ministry of Finance, Accountant-General of the Federation and Auditor-General for the Federation.
  • It supervises monthly allocation from the Federation Account, and
  • Monitors in particular the disbursements from the Special Funds in accordance with the appropriate rules (or Act of National Assembly) for the disbursement of the funds as and when required such as to ensure transparency, equity and justice to all beneficiaries.
  • Monitors closely the State/Local Government Joint Accounts and disbursements thereof. In this respect ensure that each State Government pays its share into the Joint Account and that funds from this source only is disbursed in accordance with State Assembly laws, whereas funds from Federation Account are disbursed in accordance with the Constitution and the National Assembly Act on the Revenue Formula.

Fiscal Efficiency and Budget Committee

The Committee performs the following roles:

  1. Advise on Fiscal policies and Development plans. Diversification of economy – policies of FGN, States, Local Governments and co-ordinate their efforts where appropriate.
  2. Advise all governments on budgetary policies and budgetary implementation.
  3. Encourage governments to embark upon long term economic plans (2 years, 5 years, 10 years etc) to meet immediate, short and long terms budget plans.
  4. Internal Revenue Sources – to explore and provide innovative scope and efficiency of collection, and Expansion of revenue sources.
  5. Annually acquire, analyse and criticize budgets of governments and based on the observations advice the governments on improvements.
  6. Appropriately guide Local Governments on budget planning and execution to their maximum advantage but development and people oriented.

The Committee, therefore establishes special relationship with

  • FGN – Budget office of the Presidency: Federal Ministry of Finance, Debt Management Office, National Planning Commission etc.
  • Each State Government – Budget and Planning Office of Governor/Finance Ministry Revenue Ministries and Agencies and Ministries of Local Governments.
  • Each of the 774 Local Governments – organise seminars and workshops on fiscal matters-targeting supervisory councillors on budgets and budgeting procedures as well as short, medium and long term revenue targets.
  • Private Sector Specialists, Professional bodies who are involved or interested in Fiscal blueprints internally and worldwide and constantly involve such bodies in organizing lectures, workshops, and seminars for all tiers of governments.
  • Appropriate Committees of the National and State Assemblies as well as Local Government machinery (if any) responsible for such issues.
  • Advise on Debt Management.
  • Relate with Federal Ministry of Culture and Tourism.
  • Keep abreast of Economic Policies of successful Economies worldwide with particular attention to the up-coming Countries such as Indonesia, Malaysia, Taiwan, Brazil, and Venezuela etc.

Remuneration and Monitisation Committee

The Committee undertakes the revision of remuneration packages as may be required by the Constitution on the approval of the Commission. Before such an exercise is undertaken the Committee undertakes wide consultations with all Government’s of the Federation, the Judiciaries, the National and State Assemblies, Professional economic bodies and Nigerians in general such as to satisfy the democratic principle of governance.

The Committee is responsible for the following:

  1. Monitoring and supervision of implementation of basic salaries and allowances in accordance with the Constitutional powers of the Commission.
  2. Advising on monetization and monitoring implementation.
  3. Generating cost of living indices for revision of allowances to reflect changing realities as specified in the 1999 Constitution of the Federal Republic of Nigeria but taking into account the general wage trends in both public and private sectors of the Nigerian economy.
  4. Treating all clarifications, complaints arising therefrom.
  5. The Committee shall constantly take into account other critical macro-economic factors e.g. GDP, inflation rate, cross-wage rate (i.e. public/private sector wage structure), cost of living index, comparative factors in West Africa in particular and other countries with similar economies.
  6. The Committee shall maintain close contact with all public authorities and relevant organs of government at the Federal, State and Local Government levels – including the Salaries and Wages Commission, the Nigerian Labour Congress, Federal Office of Statistics etc.

Solid Minerals Committee

The main responsibility of this Committee is to ensure that the Federal Government of Nigeria and all its beneficiary governments get a fair deal from the foreign partners and all those involved in the exploitation of crude oil as well as solid minerals in Nigeria both onshore and offshore.

The Committee closely studies and analyses the agreements and ensures fairness to the Federation with particular reference to all, Memorandum of Understanding (MOU); Joint Operation Agreement (JOA); Production Sharing Contract (PSC) with Shell etc as well as PSC with Chevron and others; Joint Venture Cash Calls (JVCC); Sole Risk Contracts (SRC)

While it examines and certifies Profit Sharing Arrangements, it also determines the fairness and transparency of the cost items constituting the JVCC such that Nigeria does not pay for all costs incurred. It therefore examines and justifies all such Budgets that involve payments from beneficiaries of the Federation Account.

Federation Account Committee

The Committee determines:

  1. Payment terms of Export Crude and instructions on LCs for such payments i.e. which Bank Account Nos; Relationship and terms of such Banks to Federation Account; signatories to the Account. Payment terms of the lifted crude and fairness i.e. is LC payable in 90 days and is this fair and is it adhered to? Is it paid to an NNPC held foreign account or to CBN held account(s), who authorizes cross-transfers to the Federation Account etc.
  2. Payment terms on Domestic crude and instructions on LCs for such payments i.e. which Bank Account Nos; Relationship and terms of such Banks to Federation Account signatories to the Account. Payment terms and fairness. When is payment made in local or foreign currency? And the payment is into whose account (NNPC or Federation Account) who are the signatories and who authorized the signatories.
  3. Payment terms for Gas of any type that contribute to the Federation Account and instructions on LCs for such payments i.e. which Bank Account Nos; Relationship and terms of such Banks to Federation Account signatories to the Account. Payment terms and fairness?
  4. CBN Accounts meant for Federation Account; Sources of Funds i.e. from foreign export crude; local domestic crude; gas accounts, LNG accounts, PPT accounts, DPR Royalty account, DPR Licenses and fees accounts. Who controls the account and what authority? (An existing law).

The Committee demands and obtains written authorities from all account keepers meant for the Federation Account including CBN, Foreign Domestic Account with any Commercial bank such as to enable the Commission to monitor constitutionally the movement of the Funds and hence vouch for this accuracy and transparency. It also establishes co-operation with CBN, Federal Ministry of Finance, Office of the Accountant-General of the Federation particularly Federation Account Desks, NNPC Foreign crude Accounts, DPR Royalty payment etc. as may be appropriate

Gas Monitoring Committee

The Gas Monitoring Committee is saddled with the following responsibility:

  1. Generates and continuously up-dates gas operations e.g. non-associated gas fields and associated gas in oil fields, quantities of gas, gathering station and their capabilities, metering stations and their capacities;
  2. Develop a databank on gas operations and update continuously;
  3. Determine the locations of non-associated gas fields by State/Local Government Areas for Onshore;
  4. Monitor gas production quantities each field gathering station of all the JVC and various customers;
  5. Monitors the end-users of the gas and the accruing revenue there from;
  6. Follow-up gas pricing policy, which is ties to fuel oil pricing as a basis for determining accruable revenue;
  7. Study various gas sales/purchase agreements between producers, JVC and consumers like NLNG and NGC and between NGC and its customers;
  8. Inspect and ensures that metering systems are periodically calibrated for accurate monitoring of quantities supplied to customers;
  9. Monitor the production capacities of gas facilities per location i.e. State or Local Government;
  10. Liaise with NNPC division or department responsible for the Corporation’s gas activities to harmonize or reconcile any discrepancies in figures;
  11. Monitors activities of NLNG and NGC;
  12. Establish a report on gas supply JVC to NLNG and NGC and NGC’s numerous customers and the revenue there from.

Crude Oil Monitoring Committee

The Crude Oil Monitoring Committee has the following term of Reference:

  • Generate comprehensive data on oil activities;
  • Develop and maintain oil databank;
  • Carries out inspection of oil production and shipping facilities platforms and jetties;
  • Monitors metering devices for random verification of quantities of crude oil produced and shipped;
  • Monitors and report any production and shipping disruption caused by Community disturbances or any other causes;
  • Verifies the locations of oil fields, wells production flow stations and shipping jetties (State, Local government Area);
  • Liaises with NNPC and DPR to reconcile figures of production and sales of crude oil;
  • Follows daily production shipping and prices of Nigeria’s crude oil using Reuters or Plat Global Monitor as a back-up or additional information;
  • Ensures that the crude oil metering facilities are periodically calibrated for production and shipping figures accuracy by sighting and calibration certificates;
  • Participate randomly in crude oil shipping operations to experience the mode of measuring crude oil volumes in vessels;
  • Follow-up crude oil production/shipping inventory system of each JVC and the management of storage tank farm;
  • Establishes periodic reports on oil production, shipping and revenue there from.