The Federal Government has pressed the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) to develop a new revenue-sharing formula that balances national priorities with the pressing demands of states and local governments.
The call was made in Abuja by the Secretary to the Government of the Federation (SGF), Senator George Akume, during a meeting with the Commission’s leadership, led by its Chairman, Dr Mohammed Bello Shehu.
Senator Akume underscored the urgency of a comprehensive and widely acceptable framework that goes beyond routine adjustments to address Nigeria’s fiscal realities. “The Commission must ensure that its recommendations are not only workable but also reflective of the country’s security challenges and developmental needs,” he said, stressing that certain ministries, such as Defence, deserve non-negotiable budgetary guarantees owing to their critical role in maintaining peace and protecting national sovereignty.
His remarks come at a time of growing debate over Nigeria’s revenue allocation formula, which many critics argue no longer serves the country’s socioeconomic context. Currently, revenue distribution follows a formula that has not been fundamentally revised in over two decades, despite population growth, security threats, infrastructure demands and calls for greater fiscal federalism.
For its part, RMAFC assured government that progress was being made on the review. Dr Shehu disclosed that a draft of the new formula would soon be submitted to the SGF for preliminary input before being forwarded to the National Assembly for legislative approval. The proposed scheme is expected to undergo robust debates as state governors, legislators and civil society groups continue to push competing claims over Nigeria’s limited resources.
Analysts note that the allocation of federal revenue lies at the heart of Nigeria’s longstanding tensions between the centre, states and local governments. While some argue that more funds should be devolved to states to strengthen grassroots development, others insist on sustaining strong federal control, especially in funding defence, security and nationwide infrastructure.
Observers anticipate that the outcome of this latest review could serve as a litmus test for the government’s readiness to confront the structural imbalances in public finance. A revised formula, they argue, may not only boost efficiency in service delivery but also strengthen trust between citizens and state institutions at a time when economic strains remain acute.
The Commission’s proposal, once made public, is likely to attract rigorous scrutiny from multiple stakeholders. If approved by the National Assembly, it would mark Nigeria’s most significant shift in fiscal policy in decades, setting a new precedent in how oil earnings and non-oil revenues are shared across different levels of government.
