The House of Representatives has mandated its committee on finance to investigate the accuracy of data provided to the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) by Nigeria’s 36 states and 774 local government areas for computation of revenue allocation.
The committee, according to the leadership of the House, will ascertain the indices used for vertical and horizontal revenue allocation, including 13 percent derivation from 2012 to 2021 and the current nature of maintenance of the data.
The House further asked the committee to investigate the indices utilised by the accountant-general of the federation for revenue disbursement to the 36 states and 774 local government areas from 2012 to 2021, including details of the actual amounts disbursed to each state for this period.
It will equally ascertain the actual amounts disbursed to the 36 states and 774 local governments from 2012 to 2021 from the Central Bank of Nigeria (CBN) and the Federal Ministry of Finance.
These resolutions were sequel to the adoption of a motion moved by Mark Gbillah at plenary on Tuesday.
Moving the motion, Gbillah said paragraph 32 of part 1 of the third schedule to the 1999 constitution (as amended) and section 6 of the RMAFC, 2004 outline the powers of the commission which include “review from time to time, the revenue allocation formula and principles in operation to ensure conformity with changing realities.”
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According to him, paragraph 32(b) of part 1 to the third schedule to the 1999 constitution (as amended) further states that “provided that any revenue formula which has been accepted by an Act of 188 the National Assembly shall remain in force for not less than five years from the date of commencement of the Act.”
The lawmaker said the House was aware that: “in performing its statutory mandate, the RMAFC is responsible for the provision of a horizontal and vertical revenue allocation formula, the collection, verification, maintenance and usage of data utilised for the computation of indices for disbursement of revenue from the federation account with regards to the horizontal and vertical revenue allocation formula and indices for disbursement of 13 percent derivation funds by the accountant-general of the federation.
“This data is required to be obtained from the 36 states and 774 local government areas of the federation by RMAFC.
The lawmaker worried about Nigeria’s current utilisation of the same vertical and horizontal revenue allocation formula and allocation principles instituted during a military regime three decades ago in 1992 when six states and 185 local government areas were created, whereas Nigeria’s population has risen from 88 million in 1992, to over 200 million in 2022.
“And the current national clamour for restructuring, devolution of powers and true federalism amid the obvious changing realities of insecurity and socio-economic hardships across the country contrary to the above mentioned statutory provisions, including Section 162(2) of the 1999 Constitution (as amended).
“We are also worried that RMAFC’s new proposal to the president in April 2022 for a revenue allocation formula is for vertical revenue allocation alone and is alleged to have utilised the over 30 year-old allocation principles and recent data that is inaccurate and unverified with no consideration being made at the moment for the more contentious horizontal allocation formula which determines the actual impact on the lives of Nigerians.”
He said the last time RMAFC claimed to have undertaken a comprehensive review of the vertical and horizontal revenue allocation formula which entailed collection and verification of data from the 36 states and 774 local governments was in 2012, which exercise was fraught with speculations about the accuracy and comprehensiveness of the exercise.
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