ABUJA — The newly appointed members of the Revenue Mobilisation, Allocation and Fiscal Commission, RMAFC, at an emergency plenary session in Abuja has suspended the special concession granted to Bayelsa State for derivation fund from three oil wells.

According to news report by The Economic Confidential, the online economic journal, the decision to suspend the special monthly grant which has so far accrued over N15 billion into the account of Bayelsa State in the last three month was due to series of complaints and requests from other stakeholders including oil producing states.

The emergency meeting which was chaired by the new Chairman of the Commission, Engr. Elias Mbam with full attendance of other members was held on December 30, 2010 a day before another emergency meeting of the Federation Account was held where $1 billion was shared to three tiers of government.

The N15 billion, which had accrued to the Bayelsa State within the period,  was over and above what would normally have accrued to it before the concession was granted in August 30, 2010 by the Presidency.

The decision to suspend further payment of the so-called special concession and compensation was for equity, fairness and justice as various states were agitating for similar concession, claiming they  have oil well beyond the 200 metre isobaths offshore including Lagos and Ogun States.

A special committee is said to have been set up by the Commission to consider the problems and complaints from other states before any further actions could be taken.

The presidential concession granted to Bayelsa State made the state to earn derivation fund from oil wells lying beyond the 200-metre isobaths, is alleged to contravene  the Offshore/Onshore Dichotomy Abrogation Act 2004 in the application of the 13 percent derivation principle.

The Economic Confidential is reliably informed that the recommendation to the President for the special concession was engineered by some agencies of government which include the National Boundary Commission, Office of the Accountant General of the Federation and the Revenue Mobilisation Allocation and Fiscal Commission.

Following the approval of President Goodluck Jonathan on August 31, 2010 the Economic Confidential confirms that Bayelsa State is now the leading oil producer and highest recipient of derivation funds among the oil producing states.

Based on the new indices that favours the state, at the Emergency meeting of the Federation Account Allocation Committee on the eve of the new Year (December 31, 2010) where a total sum of $1 billion was shared, from the derivation component alone which did not include other factors, Bayelsa State received $40 million, followed by Akwa Ibom $30 million, Rivers $28 million, and Delta $21 million. Other recipients from derivation funds include Ondo $4 million, Abia $1.3 million, Imo $1,26 million, Edo $1.2 million and Cross River $1 million.

The RMAFC is constitutionally empowered to determine the remuneration packages of public officers as well as revenue allocation to all tiers of government including indices for the disbursement to each states and local councils in the country. The question in the mind of observers is whether the RMAFC with the suspension will ask for the refund of the revenue granted to Bayelsa State fr5om seeming illegal action.