FG Orders Urgent Review of Revenue Allocation Formula
By Patience Ikpeme
The federal government has issued a directive to the Revenue Mobilization Allocation and Fiscal Commission (RMAFC), demanding an expedited review of the nation’s revenue allocation formula, which has remained unchanged for over two decades.
This order was delivered by the Secretary to the Government of the Federation (SGF), Senator George Akume, during the inaugural plenary session following the swearing-in of newly appointed Federal Commissioners in Abuja on Tuesday.
Senator Akume emphasized the urgency of the situation, stating, “The existing formula has not been reviewed in over two decades. A new equitable formula is critical for national economic stability and development.” He then proceeded to outline specific deliverables expected from the RMAFC, stressing the government’s commitment to fiscal reform.
Akume categorically instructed the commissioners to prioritize strengthening revenue monitoring and accountability, ensuring strict compliance from all revenue-generating agencies with collection and remittance laws. He stressed the necessity of blocking revenue leakages and imposing sanctions on defaulters. Furthermore, he tasked the commission with enhancing non-oil revenue mobilization, focusing on sectors such as solid minerals and taxation to reduce the nation’s over-reliance on crude oil earnings.
The SGF underscored the importance of aligning RMAFC’s strategies with the administration’s economic transformation agenda, demanding that the commission support the government’s fiscal policies to create a robust and self-sustaining revenue framework. Akume also urged the commission to foster collaboration with key stakeholders, including the National Assembly, Ministry of Finance, Federal Inland Revenue Service (FIRS), Nigerian National Petroleum Company Limited (NNPCL), National Union of Public Corporations Employees (NUPRIC), Central Bank of Nigeria (CBN), and sub-national governments, to ensure a harmonized approach to revenue generation.
Addressing the commissioners directly, Senator Akume affirmed, “Your work here will shape the financial future of Nigeria. The task ahead is daunting, but with integrity, commitment, and patriotic dedication, we will succeed. The nation expects results, and I am confident that this group of dedicated citizens will fulfill their responsibilities with diligence and excellence.”
Akume reiterated the Tinubu administration’s commitment to implementing bold fiscal reforms, driving revenue diversification, and enacting economic policies that will reposition Nigeria’s economy for sustainable growth. He quoted President Bola Ahmed Tinubu, saying, “As President Bola Ahmed Tinubu has consistently emphasised, we must expand revenue sources, curb revenue leakages, and ensure that every naira due to the Federation Account is accounted for.”
The SGF acknowledged the current economic realities, emphasizing the need for urgency, innovation, and resilience in revenue administration. He highlighted the removal of fuel subsidies, exchange rate unification, and ongoing tax reforms as strategic moves to ensure fiscal stability, but stressed that these policies would only succeed if institutions like RMAFC effectively executed their mandates.
Senator Akume assured the commissioners of the government’s unwavering support, stating, “The government remains fully committed to providing the necessary support for the Commission to achieve its constitutional mandate. In the same vein, President Bola Ahmed Tinubu has consistently emphasized the need for institutional independence, accountability, and operational efficiency.”
Earlier in the session, RMAFC Chairman Dr. Mohammed Bello Shehu acknowledged the commission’s pivotal role in Nigeria’s economic governance, emphasizing its responsibility to ensure fair and transparent revenue allocation among the three tiers of government. He stated, “As a constitutional body, the Commission plays a pivotal role in the nation’s economic governance by ensuring the fair and transparent allocation of revenue among the three tiers of government. We are also actively engaged in developing frameworks that enhance revenue generation, fiscal sustainability, and equitable distribution, in line with national development priorities.”
Dr. Shehu expressed his appreciation for the SGF’s visit, noting its importance in strengthening the synergy between RMAFC and the Office of the SGF. He stated, “This visit provides an avenue for us to share insights into the Commission’s ongoing initiatives, challenges, and strategic direction. We recognize the critical role of the Office of the SGF in coordinating government policies, and we look forward to your guidance and support in ensuring that RMAFC effectively discharges its constitutional responsibilities.”
He concluded, “We are confident that today’s engagement will further strengthen the synergy between RMAFC and the Office of the SGF in pursuit of our collective goal of national development.”
