The federal government Tuesday said it’s once again considering a review of the federation allocation sharing formula for Federal, States and Local Governments due to the present economic realities.
Chairman Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) Elias Mbam said this after receiving an award of excellence from the Nigeria Civil Service Union (NCSU) in Abuja.
Currently, the country is operating on a revenue allocation formula of; federal government; 52.68 per cent, States; 26.72 per cent and Local Governments 20.60 per cent.
Also, 13 per cent of the oil and gas federally collected revenue is returned to the oil producing states and communities as derivation revenue to compensate for ecological risks of oil production.
This formula was designed during the President Olusegun Obasanjo administration.
However, the RMAFC in 2013 saw the need to still review this formula for balanced development of the country, hence it went on a nationwide consultation to the 36 states and also met with notable figures.
By December 2014, the commission had come out with a proposed new revenue formula but for some reasons, the content never saw the light of day.
Now five years later, the RMAFC chairman said the commission plans to constitute a standing committee by next week to start work once again on the review of the nation’s revenue sharing formula.
Mbam said the commission would also make case for the diversification of the nation’s revenue for a more sustainable growth and economic development.
“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 includes 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 said.
