The Chairman, Fiscal Responsibility Commission (FRC), Mr. Victor Muruako, has explained reasons why state governments should enact Fiscal Responsibility Laws and set up related Commissions, saying macro-economic stability for the country cannot be achieved by the federal government alone.
Mr. Muruako also commended the Governor of Benue State, Samuel Ortom, for setting the Fiscal Responsibility Commission in addition to having an enabling law in place and urged other state governors to tow similar paths for the sake of national economic growth and development.
Muruako said these during the opening of a five-day capacity-building session for the chairman and members of the Benue State Fiscal Responsibility Commission, held Monday in Abuja.
He said the FRC is “committed to partnering with States and Local Governments towards strengthening the fiscal responsibility ecosystem in Nigeria as a nation has one macro-economy and its components such as States and Local Governments, in the case of Nigeria, are indispensable in achieving positive outcomes in key indices of economic development, including macroeconomic stability, debt sustainability, accountability, transparency and sustainability, amongst others.”
The FRC chairman stressed that “it will be near futile to faithfully implement the Fiscal Responsibility Act at the federal level” without instilling fiscal discipline in the state given that the revenue allocation formula places 48% of the federation revenue with the Federal Government while 52% goes to States and Local Governments.”
“When macroeconomic management is mentioned, people tend to think of it as the sole responsibility of the Federal Government, with the Federal Minister of Finance as the arrowhead. While that is not altogether false, it needs to be seen and acknowledged that the collective fiscal activities of states and local governments outweigh those of the Federal Government. Hence, to work hard at controlling unemployment, inflation, security, transparency, accountability, sustainability, macroeconomic stability, etc without a commensurate commitment of states (in particular) and local governments is like mopping the floor with the tap running.”
