Salary review for political officeholders underway, says RMAFC Chairman

Dr Mohammed Bello Shehu, the Chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), in this interview with JOSEPH CHIBUEZE, explains why the popular demand for resource control by many Nigerians may not be the best for the country now as well as the misconceptions about salaries of public officeholders.

There is a perception that RMAFC gives political officeholders jumbo salaries. To what extent is this true?
Contrary to popular perception, political officeholders do not receive jumbo salaries. In reality, the monthly salary of a minister is less than N1 million and the chairman of a commission earns a similar amount. In dollar terms, N1 million is currently less than $1,000. When these salaries were initially set, the naira was stronger. As a commission, we are actively working on reviewing these figures.

In 2024, we successfully concluded the review of judicial officers’ salaries, and it has now become law. The next focus is on adjusting the salaries of other political officeholders, including governors, legislators and heads of ministries, departments, and agencies (MDAs).

I believe that no public sector worker should earn more than the President. But how much is the President’s salary? If we proposed an increase to N5 million or N10 million, there would be a public outcry. Yet, some public officials are already earning more than that. If you examine the salaries in certain high-profile agencies, without mentioning names, you will see the disparity.

Do you consult anybody before fixing the salaries?
We conduct public hearings and engage with various stakeholders, including civil society organisations. We also consult the Nigeria Labour Congress (NLC), state governors and the Presidency before finalising salaries.

Also, we consider economic data from the National Bureau of Statistics (NBS), analysing factors such as the inflation rate and the responsibilities of each officeholder. All these elements are carefully evaluated to determine an appropriate salary structure.

Why has the commission been unable to review the revenue-sharing formula for over 30 years?
We have been actively working on it. The 1999 Constitution mandates the Commission to develop a revenue allocation formula for the three tiers of government and review it every five years, if necessary, based on relevant economic indicators.

The current revenue-sharing formula was inherited from the military government. When President Olusegun Obasanjo assumed office, he realised that the 1999 Constitution did not recognise the Federal Capital Territory (FCT) as a state. Since the Constitution stipulated that only the three tiers of government could receive a share of the federation’s revenue, we had to find a creative way to fund the FCT. This led to an amendment to the Revenue Allocation Act.

In recent years, the Commission has made multiple attempts to review the formula. We completed a review during President Goodluck Jonathan’s administration and submitted our recommendations, but for some reason, he did not transmit it to the National Assembly.

Under former President Muhammadu Buhari, between 2021 and 2022, the Commission travelled across the country to collect data and engage stakeholders, including civil society organisations, professional bodies, governors, legislators, local government chairmen and subject experts.

After thorough analysis, we developed a new revenue-sharing formula and presented it to the President. However, Buhari noted that the National Assembly was in the process of reviewing the 1999 Constitution, particularly the concurrent and exclusive legislative lists, and decided to wait for the outcome before acting. Unfortunately, due to time constraints, the proposal was not transmitted to the National Assembly.

Recently, when the Secretary to the Government of the Federation (SGF) inaugurated the newly sworn-in members of the Commission, he emphasised the need to develop a new revenue allocation formula. Even the President has on multiple occasions, suggested the same.

I want to assure Nigerians that the RMAFC has been diligently fulfilling its mandate and will continue to do so. We have already begun the process of designing a new vertical revenue allocation formula.

Committees have been formed and we are reviewing the constitutional amendments made during Buhari’s tenure. Given the current state of the economy, the previous proposal has been overtaken by events, and a fresh formula is now necessary.

Are we in any way, getting it right in terms of fiscal federalism?
Prosperous governments primarily focus on setting frameworks, regulations and operational guidelines, whether for businesses, schools, hospitals or factories. The days when states directly established factories are over. Today, such initiatives are primarily driven by the private sector.

Nigeria has made significant strides in creating a regulatory framework that allows businesses to thrive. However, what we need now is a stronger commitment to building infrastructure across the country, whether in rail, roads or a comprehensive transportation system. This would facilitate the free movement of goods and people, fostering an environment where young Nigerians, with their technological skills and creativity, can innovate, express themselves and become self-sufficient.

This administration is making efforts to harness the talents of young people in sectors such as the digital economy, marine economy and entertainment industry. As we work towards proper fiscal federalism, sometimes referred to as true federalism, it is important to recognise that federalism is not a one-size-fits-all system.

What works for Nigeria may not be the same as what works in Ghana or elsewhere. Each country must tailor its governance structure to its unique realities.

Progress is evident in ongoing discussions about state policing. Before independence, Nigeria had regional police forces, the Northern Police, Eastern Police, and Western Police. Now, there is growing acceptance at both the state and federal levels that states should eventually have their police forces.

In my view, what Nigeria needs most is more dedicated political leadership at all levels. States should learn from one another. For example, if Lagos is successfully diversifying its economy and achieving results, Kano should study and adapt those strategies. Similarly, Borno state is making significant progress in agriculture and ranching, other states should adopt and improve upon such initiatives. What is missing is a sense of healthy competition among states.

With the revenue they receive from the Federation Account Allocation Committee (FAAC) and their internally generated revenue (IGR), states have the potential to achieve much more. For those struggling, the Federal Government can step in to provide support and create an enabling environment that attracts investment and fosters economic growth.

What is your take on the call for resource control by states?
The Constitution is clear; just because a mineral resource is located within a state does not mean it belongs to the state. Resources such as oil, gold, silver, copper, tin and lithium are classified as federation resources.

If states were to claim full ownership of the resources within their territories, where would that leave the Federal Government, which is responsible for national defence, security, foreign policy and numerous other critical interventions? The current system ensures a balanced approach to resource management and national development.

Rather than focusing on exclusive resource control, states should compete through creativity and innovation in governance and economic development. It is not the right time to argue that simply because a state has gold, it should retain all revenue from it and only contribute a small portion to the Federal Government.

Historically, even under the Northern and Southern protectorates, tax revenues and income from one region were sometimes used to supplement another due to economic disparities. For instance, since education was more developed in the South, funds from the Northern protectorate were occasionally used to support schools there. This principle of shared national development has long existed.

While we can continue refining our federal structure, the current system allows the Federal Government to invest in underdeveloped areas to ensure balanced growth. There may come a time when constitutional provisions on resource control are revisited, but in my view, now is not the right time for such a shift.

Why are we asking for more money for states when there is evidence that many have not effectively used what they currently receive to serve the people?
States and local governments should be the primary drivers of development. While it is true that some states have not effectively utilised their resources, that should not prevent the nation from mobilising support to strengthen them.

Even the President has expressed the belief that states and local governments should receive more funding to fulfil their responsibilities.

It is also important to recognise that not all states are underperforming, several have demonstrated strong leadership, innovation and economic development. If a governor is not delivering results, the democratic process allows the people to vote them out after four years and elect better leadership.

Some states, both in the South and the North, have consistently had competent governors who have driven progress through innovation and revenue generation. Rather than withholding funds, we should focus on holding underperforming states accountable and pushing them to improve.