Lagos State government through the commissioner for finance, Rabiu Olowo, has again reiterated its demand for a more equitable revenue sharing formula, as the Revenue Mobilization Allocation and Fiscal Commission (RMAFC), set to review the current revenue allocation. “In every democratic environment, it is imperative to consciously and periodically review the mechanism of Resource Allocation to ensure Fair, Just and Equitable distribution of ‘Commonwealth’ among the tiers of Government. Unfortunately, this had not been executed for more than 29years”.
Olowo stated this at the recently concluded 2-day Southwest stakeholder’ public hearing on the revenue allocation formula, organised by the RMAFC, disclosing that all stakeholders from the Southwest region held a common ground that the existing revenue allocation formula that was inherited from the Military in 1992 is not in tandem with both social and economy reality. Hence, all hands must be on deck to ensure that ‘life-enhancing’ indices are given priority over highly subjective criteria.
According to the Lagos commissioner for finance, every state and local governments are contributing substantially to the general welfare including the internal security at a level far beyond what the 1999 Constitution envisaged. “As we continue this historic process today, let us bear in mind that the impact of today’s decision will live with us for many years to come. More so, there is collective responsibility to ensure that the new revenue allocation formula mirrors the realities on ground,” said Olowo.
For instance, he posits that all Lagos State Government MDAs as well as major Facilities across several sectors are off-the national electricity grid and are currently being served by Lagos State Independent Power, which provides a very consistent electricity supply. “Lagos State is breaking new grounds to make life easy for all Nigerians but as we continue to increase expenditure on welfare of our growing population, the Federal allocation to Lagos State on the basis of hospital bed spaces, school enrolments and others, continue to reduce every year,” Olowo said.
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Elias Mbam, Chairman, Revenue Mobilization Allocation and Fiscal Commission (RMAFC), said the commission is empowered to review from time to time the revenue allocation formula and principles in operation to ensure conformity with changing realities.
According to Mbam, since the last review in 1992, there have been a lot of socio-economic changes that necessitated the need for a sharing formula that reflects changing realities. “In view of the sensitivity and its socio-economic importance, the review has become necessary to ensure fairness, justice and equity,” he said.
Mbam further said that the RMAFC will replicate the public hearing in the other five (5) geopolitical zones of the country. He equally disclosed that the needed data has been collected from relevant government agencies to aid its review.
Other Southwest governors were represented by their commissioner for finance. Seyi Makinde of Oyo State represented by Akinola Ojo, the state commissioner for finance, posits that the present formula will not take Nigeria to her promised land, hence, a higher responsibility should be given to states with higher resources.
“Oyo State will support any review that will allow each state and local government to have better resources to meet the needs of its people,” said Ojo.
Dapo Abiodun who was represented by Dapo Okubadejo, Ogun State commissioner for finance, said the review should also allow state control of the resources in their domain. Accordingly, he posits that a 50 percent royalty generated from natural resources should be paid to the state where it is extracted from. “Population density should be the basis of revenue sharing,” he said.
