The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has announced plans to overhaul Nigeria’s revenue allocation formula, which was last reviewed in 1992 and no longer reflects the country’s changing economic and demographic realities.
Speaking during a high-level panel discussion in Abuja, RMAFC Chairman Dr Mohammed Bello Shehu stressed the urgency of developing a new, data-driven formula that upholds fairness, strengthens national unity, and ensures that subnational governments can effectively meet their fiscal responsibilities.
He urged all stakeholders to rise above sectional interests, noting that the revenue formula plays a vital role in the provision of essential services such as education, healthcare, and infrastructure across the federation.
“Our goal is to design a formula that empowers subnational governments to meet their constitutional obligations effectively while maintaining national cohesion and macroeconomic stability,” Dr Shehu said.
“The choices we make here will determine the capacity of governments to serve their people for years to come.”
The proposed reform coincides with amendments to the RMAFC Act, granting the Commission authority to collaborate directly with private sector entities, including oil companies, to verify and recover revenues due to the Federation.
This represents a strategic shift towards greater transparency, accountability, and enhanced revenue mobilisation—key components of Nigeria’s sustainable development goals.
Chairman of the Senate Committee on National Planning and Economic Affairs, Senator Yahaya Abdullahi, called for collective trust and transparency to ensure the success of the reform.
“No matter how brilliant the ideas or technical solutions are, without political consensus and a shared national vision, progress will remain elusive,” he said.
The Governor of Kwara State and Chairman of the Nigeria Governors’ Forum, AbdulRahman AbdulRazaq, represented by Dr Abdulateef Shittu, praised RMAFC for creating a neutral platform for dialogue between the federal and subnational governments.
He pledged the Forum’s support for a just, transparent, and workable revenue-sharing framework.
Also speaking, the Minister of Budget and Economic Planning, Senator Abubakar Atiku Bagudu, commended the Commission’s initiative, describing the review as vital for national stability.
“Our Constitution envisages cooperation among all tiers of government in advancing the welfare and security of the people. Equity must begin with revenue mobilisation, not merely allocation,” he said.
The Special Adviser to the President on Policy Coordination, Hadiza Bala Usman, urged a bold and conclusive review that aligns fiscal reforms with Nigeria’s broader development agenda.
Stakeholders at the session emphasised the need for a formula that promotes fiscal responsibility, innovation, and accountability among subnational governments. They also advocated empowering states and local councils with more resources and responsibilities to better serve their populations.
As Nigeria navigates complex economic realities, RMAFC reiterated that this initiative aims to lay a new foundation for inclusive growth, fiscal stability, and sustainable national development.