…RMAFC reveals why revenue allocation wasn’t reviewed for 29 years
Governors of North Western region have demanded the lion shares of Revenue Allocation for both States and Local Government Areas in the country above that of the federal government, saying the two arms of government should take 60%, leaving 40% for federal government.
The region which consists of Kaduna, Kano, Katsina, Sokoto, Jigawa, Kebbi and Zamfara made this demand in their respective presentations at the zonal public hearing on the review of the current Revenue Allocation Formula, held in Kaduna on Monday.
In support of their demand, the states’ representatives argued that the second tier of government is burdened with the funding of security apparatus which is the sole responsibility of the federal government.
In his presentation on behalf of Kano State, Secretary to the State Government, Alhaji Usman Alhaji, complained that the federal government was taking too much of the revenue than the states and local government areas and said “federal government should take 41%, states 34%, LGAs 24% and we need an independent one percent for Kano state because it is a mini Nigeria”.
Similarly, Katsina state while expressing displeasure over the current sharing formula, recommended 35% for states, 25% for local government and 40 percent for federal government.
According to the State Commissioner for budget and economic planning, Alhaji Farouk Jobe, “the revenue allocation was long overdue and its review is timely because it is getting to 30 years that the allocation was reviewed.”
Jigawa State Commissioner for Finance and Budget, Alhaji Ibrahim Babangida Umar said in their presentation that states and local governments should take lion shares of the allocation for rapid development, proposing 44% for federal, 34% for states and 22% for local government.
Kaduna state government was represented by the Permanent Secretary, Ministry of Finance, Mohammed Shuaibu. In their presentation, he said, “certain percentage be sent aside for poverty/insecurity ridden States, and 13 percent derivation should remain, but extend to mineral resources also”.
Earlier in his Keynote address at the event, Kaduna state governor, Nasir El-Rufai, who was represented by his deputy, Dr. Hadiza Balarabe remarked, “Our reality is that the Federal Government has since the late 1960s acquired powers and resources similar to those exercised by the sovereign in unitary systems. Most of the 36 states rely on the revenues from the Federation Accounts Allocation Committee (FAAC).
“The Federal Government retains the largest chunk of federation resources. It does too much but is too stretched and so does little well. Yet, the things that really matter to citizens are state and local government functions. For instance, basic and secondary education, primary health care and agriculture are subnational responsibilities. But the way things are, many states have to support the federal security agencies deployed within their jurisdictions, despite the fact that security is a federal responsibility.
“Therefore, the argument for a significant review, in favour of states, of the vertical revenue allocation formula is compelling. The Federal Government has to consolidate its focus around security, foreign affairs and monetary and fiscal policy. It should allow the states and the local governments to get more revenues to deliver better governance at the grassroots.
“The APC True Federalism Committee, which I chaired, had recommended a review of the revenue allocation formula in favour of the states. In my view, this is the most efficient way to adjustment the finances of the federation while transiting to a wider devolution of powers and responsibilities”.
Speaking further, he went on: “I do not wish to preempt the submissions that the states in this zone will be making at this event. But I will state that the progress and development of our country depends on well-functioning states. The revenue allocation formula is critical to that”.
Meanwhile, in his opening remarks, the Chairman, Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Engineer Elias Mbam gave reasons why revenue allocation remained unreviewed for 29 years contrary to Constitutional provisions of every five year review.
Mbam disclosed that due to socio-economic and political changes in the country, the allocation was last reviewed in 1992.
“As you may all be aware, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) by virtue of paragraph 32 (b), part 1 of the Third Schedule to the 1999 Constitution of the Federal Republic of Nigeria ( As Amended) is empowered, “to review from time to time the Revenue Allocation Formula and principles in operation to ensure conformity with changing realities, provided that any Revenue Formula which had been accepted by an Act of the National Assembly shall remain in force for a period of not less than five years from the date of commencement of the Act”
“In line with the above constitutional provision and the fact that there had been several socio-economic and political changes in the country since the last review in 1992, the Commission has commenced the process of reviewing the subsisting revenue allocation formula to reflect these changing realities.
“Accordingly, the Commission has designed processes and guidelines to ensure adequate participation of Nigerians. In this regard, the Commission has undertaken sensitization visits to all the States and Local Governments to make sure that the generality of Nigerians participate in the process”. The RMAFC boss said.
