From Isaac Anumihe, Abuja
The Federal Government proposed an adjustment to its revenue sharing formula, allocating 23:73 per cent to local governments as against the previous 20:60 per cent.
Other adjustments include Federal Government, 50:65 per cent as against 52: 68 per cent; State Governments, 25; 62 per cent as against 26:72 per cent; while it retained 13 per cent derivative for the oil-producing states.
The Secretary to the Government of the Federation (SGF), Boss Mustapha, who made the mind of the Federal Government known to Nigerians during a public hearing in Abuja, said that the government considered a number of things before arriving at its conclusion.
According to Mustapha, the Federal Government considered its increasing visibility in sub-national level responsibilities due to weaknesses at the level, citing primary health care, basic primary education, increasing level of insecurity and increased remittances to state and local governments through Value Added Tax (VAT) sharing formula, where the federal government has only 15 per cent and the states and local governments share 50 per cent and 35 per cent, respectively.
‘In order to appreciate the position of the Federal Government, it is also necessary I share with us the vertical disbursement of the share of 52:68 per cent which is as follow:
‘Disbursement of the Federal Government’s share of 52:68 per cent; Consolidated Revenue Fund (CRF), 48:50 per cent; FCT, 1: 00 per cent; National Resources Development Fund, 1:68 per cent; Ecological Funds, 1:00 per cent.
‘(45 per cent to National Emergency Management Agency (NEMA), North East Development Commission (NEDC), National Agricultural Land Development Authority (NALDA) and National Agency for the Great Green Wall (NAGGW),55 per cent which addresses ecological challenges of sub-national levels),’ he said.
Mustapha noted that, for Nigerians to agree on an enduring vertical review of the present revenue allocation formula, they must first agree on the responsibilities to be carried out by the tiers of government.
Earlier, the Chairman of Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Engineer Elias Mbam, said that the review of the revenue allocation formula became necessary because the last review was in 1992 and there have been obvious changes in the nation’s socio-cultural, political and economic environments since that time.
‘As you are aware, the 1999 constitution of the Federal Republic of Nigeria (as amended) empowers the Commission to periodically review the revenue formula and principles in operation to reflect changing realities,’ he said.