RMAFC boss says new revenue sharing formula ready by December

Elias Mbam, the Chairman, Revenue Mobilisation, Allocation and Fiscal
Commission, on Wednesday said the new revenue allocation formula would be ready for approval by December.
Mbam made this known in an interview with the News Agency of Nigeria in Abuja.
The chairman said that the commission would present the new plan as a
recommended formula to President Goodluck Jonathan for consideration
and afterwards it would be passed to the National Assembly to be
approved as law.
Mbam said: “We expect that by December, before the end of the year, we present to Mr. President our recommendation of the formula on revenue sharing for onward transmission to the National Assembly for further discussion.
“We have progressed much, we have done several studies of fiscal
matters, we have toured other federations to compare their fiscal
arrangements and be able to get their experiences and use the
experience as part of what we can apply in our own case.
“Also, we have sensitised the people and collected data from 774 local governments and the 36 states and also the FCT relevant data.
“And then we have done a literature review of all fiscal arrangements
that had been done before independence till date.
“So we have all the records and we are in the process of commissioning a lead consultant.
“And the next stage we are in is to carry out zonal advocacy.
“We have gone to all states to sensitise them.
“We have consulted elders.
“We have consulted opinion leaders.
“We have consulted Civil Societies.
“And so, what we are to do next after we have visited all the zones is to bring all the reports together, analyse them and then come up with a position of majority of Nigerians.”
Mbam said that the present formula needed to be reviewed because a lot had changed since it was designed 21 years ago.
He added that though President Olusegun Obasanjo’s administration
modified the formula a bit to conform to the 1999 constitution, it
needed to be further revised.
He said: “The constitution says that after five years, a commission
should look at changing realities.
“What has changed within that period, does it require a review in
terms of what was due for Mr. A, for Mr. B?
“If you look at the present formula, the last time it was reviewed
actually was 1992 and from 1992 till now, it’s almost 21 years and you can agree with me that since 1992 till now, a lot have changed.
“The population has changed.
“All the indices used in determining the formula have changed.
“So because of these changes, we need to update the record.
“We need to also know what are the main challenges of socio economy of Nigeria and now refocus the allocation formula in line with the
aspirations and desire of Nigerians.
“That is why it becomes absolutely necessary that we review to reflect the socio-economic changes in Nigeria and the desire of the Nigerian people.”
Mbam disclosed that certain factors would play an important role in
fashioning the new formula.
This would include equality of states, population, landmass and the
origin of natural resources, with not less than 13 per cent to be
considered.
Mbam added: “When we are talking about revenue allocation formula, we
are considering two levels of sharing: one is among the three tiers of government, the Federal Government, the state government and the local government.
“These three levels have percentages: the Federal Government will tak its own percentage, fortunately, it is not sharing with anybody.
“But when they give the states their own percentages, they now have to share within the states.
“Each state gets 26.7 per cent for instance.
“What per cent of that will go to Anambra, to Sokoto, to Borno?
“That sharing among those states and among the local governments,
within their own percentage allocation, is what we call horizontal
allocation.
“But among the three levels of government, the federal, state and
local government is what we call the vertical sharing, but many people are only concerned about the vertical but it is also important to look at the horizontal.”