LONG OVERDUE: Reps order RMAFC to produce new revenue allocation formula
Published:8 Nov, 2012
The House of Representatives on Wednesday asked the Revenue Mobilisation, Allocation and Fiscal Commission to table a new revenue sharing formula for the three tiers of government before President Goodluck Jonathan within two weeks.
The President, in turn, is to lay the proposal before the National Assembly in line with Section 162 (2) and Part 1, Paragraph 32(b) of the Third Schedule of the 1999 Constitution (as amended).
The current formula in use is skewed in favour of the Federal Government, which takes 52.68 per cent of allocation from the Federation Account.
The 36 states have a combined share of 26.72 per cent, while the 774 local government areas in the country take 20.6 per cent.
Oil-producing states share 13 per cent in accordance with the principle of derivation.
However, of late, there have been clamours for a review of the statistics by cutting the Federal Government’s share to make more funds available to states and local governments.
State governors, through the Governors’ Forum, have led the clamour, claiming that development in their domain was being stifled due to inadequate funds.
In January, the governors had demanded a new revenue formula as a condition for backing the Federal Government’s bid to remove subsidy on petrol.
The House had in July called for a review of the present formula.
On Wednesday, it gave RMAFC two weeks to comply with its resolution on the issue, following the debate on a motion by a member from Kano State, Mr. Aliyu Madaki.
The lawmakers were of the opinion that the Constitution had been “observed more in breach” since 1999, with regard to revenue sharing among the three tiers of government.
The Speaker of the House of Representative, Mr. Aminu Tambuwal, said the legislature would investigate why it had been difficult for RMAFC to comply with the Constitution over the years.
“RMAFC must come before the House Committee on Finance to explain why it has been unable to pass the (new) revenue formula to Mr. President,” he said.
Tambuwal added that in a bid to address the apparent inability of the commission to forward the proposal to the President, as required by law, the House would amend the Constitution to require RMAFC to send the formula directly to the National Assembly.
The Deputy House Leader, Mr. Leo Ogor, recalled that the power of the National Assembly to approve a new revenue formula for the country was usurped in 2002 by former President Olusegun Obasanjo through a presidential fiat.
He said the current formula was imposed on the nation by the former President without the input of the legislature as required by law.
Besides, Ogor told the House that the financial realities in the states and local governments at present had made the need to review the formula very urgent.
“The present revenue formula is not realistic. It is the responsibility of the National Assembly to bring it in line with the present realities,” he added.