Commission moves for new revenue sharing formula
Five years after talks stalked on a sustainable sharing formula for revenues accruing to the federation among the three tiers of government, the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) is to reopen the contentious issue.
Consequently, the commission has hinted of its determination to constitute a standing committee next week to begin work on the matter.
The extant sharing formula of 52.68 per cent for the Federal Government; 26.72 per cent for the states and the local councils’ tally of 20.60 per cent came into existence in 2000 via a fiscal circular by former President Olusegun Obasanjo.
Efforts to enthrone a wholly consensus and more equitable method by the erstwhile President Goodluck administration in 2014 ended in a fiasco.
The Bayelsan-born ex-leader reportedly got a bash for allegedly reviewing the formula in favour of the states, hence it was rejected and could not be forwarded to the National Assembly for legislative action.
But the RMAFC chairman, Elias Mbam, yesterday hinted that all of this is to change soon, as the Federal Government was considering a review of allocation owing to the prevailing economic realities.
He spoke in Abuja after receiving an award of excellence from the Nigeria Civil Service Union.
Mbam said the commission would also pursue the diversification of the nation’s revenue for a more sustainable growth and economic development.
His words: “My agenda is to expand the sources of revenue for the federation. I will like to expand the cake that we are sharing so that people will get reasonable quantity.
“I intend to do this through diversification in areas outside oil and gas, and that include solid minerals, agriculture and manufacturing.”
“So, we will encourage states and let them know what is available outside oil and gas so they can develop this aspect of the economy to their own benefit.”
He also sought a revisit of financial autonomy for the council areas to enable the bulk of Nigerians at the grassroots get the best out of democracy.
Apart from the votes from the Federal Account Allocation Committee (FAAC), 13 per cent of the oil and gas federally collected revenue is returned to the host states and communities as derivation revenue to compensate for the devastation of their areas on account of exploration and production of the black gold.
Poised to right the alleged lopsidedness of the sharing formula for even development of the country, the RMAFC had consulted widely in 2013 and came up with a new one in December 2014, but for some reasons, the content never saw the light of day.