The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has announced the commencement of the process of reviewing the Revenue Allocation Formula (RAF) for the federal, state, and local governments.
Chairman of the Commission, Mr. Mohammed Shehu, who announced this at a media briefing in Abuja, said the review has become necessary as a result of the current economic realities.
The RMAFC specifically said that recent constitutional amendments have devolved certain responsibilities to the States, thereby placing new financial burden on them.
Shehu assured that the review would be inclusive, data-driven, and transparent, adding that it will involve broad-based consultations with critical stakeholders, including the Presidency, National Assembly, State Governors, ALGON, the judiciary, MDAS, Civil Society Organisations (CSOo), traditional rulers, the organised private sector, and development partners.
Shehu noted that the last review was in 1992, saying that under the current formula, the Federal Government receives a 52.6% share, state governments take a share of 26.7% while the local governments get 20.6%.
The chairman of the RMAFC explained that the review aimed to create a fair and equitable revenue-sharing formula that reflects the current responsibilities of all three tiers of government.
Shehu said that the 1999 Constitution mandates the RMAFC to review, from time to time, the revenue allocation formulae and principles in operation to ensure conformity with changing realities.
In the words of Shehu; “In line with this constitutional responsibility and in response to the evolving socio-economic, political, and fiscal realities of our nation, the commission has resolved to initiate the process of reviewing the revenue allocation formula to reflect emerging socio-economic realities.
“The commission is also committed to integrating cutting-edge research, empirical data, and international best practices in its analysis,” he assured.
