The Nation Newspaper

Tag: formula

  • Stakeholders adopt formula for political offices  

    Leaders in Anambra East have adopted a sharing formula for political offices.

    They took the decision at a meeting at the palace of Igwe Kelly N. Nkeli (Okalakwu), the traditional ruler of Igbariam.

    The meeting was convened to entrench understanding in Anambra East.

    Nkeli said the stakeholders considered it necessary to adopt the formula so that the people would have a sense of belonging.

    He said the formula was accepted by political leaders in communities within the local government.

    The monarch listed the sharing thus-  House of Assembly (Igbariam community), Local Government Chairman (Nando community), Deputy Local Government Chairman (Nsugbe  community),  Local Government Secretary (Umueri community) and Leader of Local Government Legislative Council (Umuoba Anam community).

    Deputy Leader of Local Government Legislative Council and supervisory councillors for works, health and agriculture were zoned to the five communities in Aguleri.

    Nkeli said the leaders would ensure the implementation of the formula.

  • The Imo formula

    •Gov. Okorocha devises an ingenious means of surmounting economic woes

    In response to the challenges facing the three tiers of government, Gov Rochas Okorocha of Imo State has announced plans to cut down the number of working days per week. The governor said it had become imperative to find an unorthodox means of confronting the huge problem as all other means have failed to restore health to the state’s ailing economy.

    Almost all the 36 states of the federation have been hard hit by the nation’s dwindling economic fortunes. Twenty- seven of the states are practically insolvent, unable to meet their basic responsibilities – to workers, institutions  and the people. Twice, the Federal Government has had to give bailouts to enable states pay their workers’ salaries and streamline their finances. This has driven home the point made by economists that relying on a wasting asset like oil for more than 80% of our foreign exchange earnings is dangerous to the nation’s economy. Yet, successive governments at all levels have consistently paid lip service to diversification of the sources of income.

    Therefore, many states have nearly collapsed owing as much as six months salaries to their workers and unable to embark on new projects. This is reflective of the lazy approach to governance adopted by present and previous governments. The states have been satisfied with going to Abuja with the begging bowls every month. All that public officials are concerned about is sharing, not baking the national cake. Now that what is available for sharing is not enough, many of the governors are still slow in responding to the reality. This is why we commend the Imo State governor for thinking out of the box. He has decided to free workers for two of the working days to enable them augment whatever they get from the shrunk state coffers.

    This approach will solve two problems.  One, for doing less, they will be paid less, thus freeing resources for other purposes. Two, Nigeria is seen mainly as a consuming country, this Imo formula will boost production in the state if well executed. We commend the measure to other states, in realisation that most of the states’ public services are over-bloated. Some can be more effective with less than half of their current size, but, since downsizing would be too harsh a measure to adopt now, cutting down on the working days and the pay packets could be a more realistic option.

    Gov. Okorocha should do more by encouraging the workers to go into farming. This might involve making available to them credit facilities and organising them into cooperatives. Backed by the right machinery and extension services, the result could return the state to buoyancy and the workers to prosperity. In the first republic, states in the Eastern Region were sustained by agricultural products, with palm produce being the mainstay of the economy. It is time to replicate that feat.

    We call on labour to support the Okorocha initiative. Nigeria is in an emergency and all hands must be on deck to get her out of the woods. It is not a mark of honour or chivalry for the labour movement to oppose every measure being adopted to tackle this hydra-headed problem without suggesting alternatives. We also commend the measure to other states since the days of free money dispensed from the federation account appear gone. There is no state in Nigeria that cannot survive on agriculture. The Northern states that survived on groundnut and cotton in the first republic could revive their economy by going into massive cultivation of the same products, adding rice and wheat, among others.

    In the West, the cocoa and kolanut that served as the mainstay of the economy before the oil boom have long disappeared. It is time to return to those days. A restructuring of the national fiscal architecture is inevitable. This will enable the federating units compete positively, thus promoting national development.

    Gov. Okorocha has blazed the trail; it is incumbent on others to also think out of the box.

  • Our winning formula, by firm

    The Chief Excutive Officer (CEO), mediaReach OMD, Mr. Tolu Ogunkoya, has said his firm’s winning formula at local and international levels remains the same.

    He spoke against the backdrop of his firm’s success at the Cannes Lion Festival where the agency got 11 awards. His agency’s  global group, Omnicom Media Group (OMG), under which OMD operates, won 15 awards.

    He said: “Our global winning culture cascades into our local markets; we train our talent on an on-going basis, including regional webinars on weekly basis as a source of inspiration to be abreast of latest developments and raise the game.

    “We have many local initiatives through which we encourage our people to produce works that deliver on objectives and help overcome current business challenges of our clients. This year too, mediaReach OMD Nigeria represented Nigeria at the Cannes Young Lions Media global competition; this is our seventh time at the Cannes since 2008.”

    However, the organisers said the media agency holding company won the medals through its agencies, OMD and PHD.

    Specifically, they said OMD won 11 Media Lions, which was the highest number of awards – one gold, three silver and seven bronze medals. PHD also smiled home with four medals.

    According to the organisers, OMD from Dominican Republic won the Gold Lion for OMG for its campaign tagged: “Ending the Silence”; while the silver medals went to OMD UK and OMD Dominican Republic. OMD was also the credited partner for the Grand Prix winners in the PR, Creative Effectiveness and Mobile categories.

    The combined performance of OMD and PHD therefore propelled Omnicom Media Group to the top of the category, winning more than twice as many Media Lions as the next most awarded media holding company.

    The organisers said OMD won the awards for its work, which cuts across a broad spectrum of client categories – including Automotive, CPG, Financial Services, Media, Retail, Sports Goods and Technology – submitted by OMD agencies across the globe.

    The CEO of Omnicom Media Group Worldwide, Daryl Simm, said: “The scale and scope of Omnicom Media Group’s  win at Cannes this year proves that relentless focus on excellence, innovation and talent always achieves results not only in terms of industry recognition, but most importantly, in driving business growth for our clients.”

  • Buhari ‘ll get new revenue formula, says RMAFC

    Buhari ‘ll get new revenue formula, says RMAFC

    The draft reports of the revenue allocation formula as well as the remuneration packages for political, public and judicial office holders are being fine tuned for submission to President Muhammadu Buhari for onward transmission to the National Assembly.

    The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) in a statement endorsed by its Head, Public Relations, Ibrahim Mohammed,  yesterday explained that it concluded its own side of the bargain since 2014.

    “As the Commission was in the process of sending the draft report to former President, Dr. Goodluck Jonathan, certain intervening variables crept in to truncate the process. These included the proceedings of the Justice Kutigi-led National Conference and the Senator Ikweremadu-led Constitutional Amendments respectively which also deliberated extensively on the issue of revenue allocation formula review and lastly the 2015 general elections which saw to the emergence of the Buhari administration,” the statement added.

    Mohammed dismissed reports suggesting that the commission was about to withdraw the two sensitive reports stressing that the “RMAFC was yet to make submission of either of the said reports to Mr. President.”

  • In the cooler

    In the cooler

    •Is the Presidency seeking to wish away the revised revenue formula?

    Why has the Presidency hedged so blatantly in receiving the report of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) on the proposed revised national revenue formula? For a report which has been ready since the beginning of the year, it is either that President Goodluck Jonathan has no interest in it or that he does not understand the import of activating such a crucial national document.

    According to media reports, after two years of gruelling work which included touring all the zones of the federation and parleying with stakeholders across the country, the RMAFC had concluded work on the revised national revenue allocation since last December and has since conveyed the report to the Federal Executive Council (FEC).

    However, the commission has not been able to formally present it to the president even though it is an agency under the Presidency. Unlike the just concluded National Conference which was able to hand in its report to the president almost immediately, RMAFC has been unable to be scheduled for a presentation. A formal presentation is necessary in this part of the world because, without it, a report is practically non-existent.

    This has set observers worrying that something must be amiss. The reason is that it is a well known fact that at the heart of Nigeria’s structural and fiscal imbalance is the subsisting lopsided and inequitable federal revenue sharing formula.  Though Nigeria supposedly practises federalism in which the federating units are deemed to be equal partners, over the years, the reality has been an aberration in which the centre has become a much too dominant member.

    Though the constitution stipulates at least a five-yearly review of the revenue formula, the last exercise was 22 years ago, while two modifications were effected in 2002 and 2004 to align relevant sections of the Federation Account Act to the 1999 constitution. But the constitution, having envisaged the need for justice, equity and fairness in the distribution of the resources accruing from the federation,  entrenched the need for periodic review in order to capture any emerging economic and socio-political dynamics that may be thrown up from time to time.

    However, it is only understandable that since RMAFC is under the ambit of the Federal Government and the current formula seems quite favourable to it, it would be convenient to keep it so. This must explain why for more than two decades, what ought to be a routine constitutional obligation enshrined to keep the system fit and healthy was jettisoned by successive administrations. The Federal Government being the first tier and wielding some administrative influence over the commission had ensured that this unsavoury status-quo remained.

    There is no doubt that the current sharing formula is not sustainable. It allows 52.68 per cent of revenue for the Federal Government; 26.72 per cent to be shared by the 36 states and 20.60 for the 774 local government areas. The Federal Government, with more than half of national revenue – a hefty chunk by all standards – must have grown used to spending big and living large, thus would naturally loath to be pruned down. But the obvious result of this current state of affairs is stunted growth and warped development. One example is the fact that the Federal Government has in the last decade, consistently devoted three quarters of its annual budget to recurrent expenditure whereas the reverse is the case for most states which spend at least 60 per cent of their budget on capital expenditure.

    Though we acknowledge that the states control the local governments and this third tier has gotten the short end of the stick, all these only lend credence to the call for urgent review of the current formula. We urge the president to hasten to receive the report of the review of the revenue sharing formula and set all necessary machinery in motion for its speedy implementation in the national interest.

     

  • Raging battle over revenue sharing formula

    Raging battle over revenue sharing formula

    To pundits, the revenue sharing formula remains a hotly debated issue as opinions are divided that many states of the federation are being shortchanged by the system in the disbursement of the national cake. Ibrahim Apekhade Yusuf with agency reports examine the thorny issue

    It is anybody’s guess why revenue sharing by states of the federation has remained a very hotly debated issue.

    Reason: it’s all about politics of money: who gets what, when and how.

    Crux of the matter

    The battle for equitable revenue sharing formula has remained a recurring decimal as state governments from resource rich-states, especially oil producing states, have continued to raise their voice above the din as to why they should get the huge chunk of the pie considering the fact that they are the major revenue earner for the country.

    Interestingly, some of the states in the Niger Delta region became favoured in the scheme of things as the Federal Government succumbed to the agitation for a better deal.

    But then, this led to more agitations by other regions, especially the north, with cries of marginalisation everywhere.

    The contentious revenue sharing formula

    The contentious revenue sharing formula and derivation principle remain one thorny issue that has remained unresolved.

    Expectedly, the same controversy reared its ugly head recently at the National Conference in Abuja, with splinter groups emerging at different camps.

    Observers say that the deadlock tends to reinforce the widespread notion that the country’s leaders are more interested in sharing the national cake than in baking the cake.

    The recommendation that pitched the country’s geopolitical zones against each other was the increase of derivation percentage, payable to mineral producing states and the stabilisation, rehabilitation and reconstruction fund, proposed for areas affected by terrorism and insurgency.

    To tackle the ensuing crisis situation, the Conference’s Chairman, Justice Idris Kutigi, summoned a meeting of the chairmen of the 20 standing committees and their deputies.

    Yet, the delegates failed to conclude voting on the recommendations of the Devolution of Power Committee, led by former Gov. Victor Attah of Akwa Ibom and former Inspector-General of Police, Ibrahim Coomasie; following sharp disagreements between delegates from the northern and southern parts of the country.

    To resolve the stalemate, a committee was set up and the committee recommended the increase of the derivation percentage from 13 per cent to 18 per cent.

    The committee also proposed that 50 per cent of the proceeds from the 18-per-cent derivation must go directly to communities where the mineral resources are extracted.

    The committee, headed by Prof. Ibrahim Gambari, also recommended the establishment of a National Intervention Fund, which shall be five per cent of the annual revenue of the Federal Government, for the stabilisation, rehabilitation and reconstruction of areas affected by terrorism and insurgency.

    The fund would be used for the North-East, in the first instance, and other parts of the country eventually.

    Three out of the 37 members of the elders’ committee did not endorse the report.

    Delegates from South-South, South-East and South-West geopolitical zones kicked against the intervention fund, insisting that “if there must be a fund of that nature; it must be set up for the entire country and not for a section of the country or the North alone.”

    Coomasie, a member of the Elders’ Committee, said that the committee failed to reach a consensus on the issue.

    “I am one of the delegates from the North involved in the discussion on derivation, and I want to say that we had discussions which ended in a stalemate,” he added.

    However, Chief Olu Falae, a member of the committee, said that the committee reached a consensus, while Chief Raymond Dokpesi, another member of the committee concurred, saying that the recommendations were agreed upon on principle.

    He said that the bone of contention was whether the committee should include the North-West and North-Central geopolitical zones in the areas affected by the insurgency.

    “All the Southern leaders, North-Central leaders made sacrifices, but there are some people who never wanted this conference to succeed and these people were the ones shouting today,” Dokpesi said.

    The impasse was not resolved on Monday, Feb. 14, when the delegates resumed plenary, compelling the conference to recommend that “government should set up a technical committee to determine appropriate percentages on the three issues and advise government accordingly.”

    There were, however, mixed reactions about the inability of the national conference to resolve the issue of revenue sharing via consensus.

    Senator Anietie Okon, a delegate from Akwa Ibom, said: “We are merely postponing what will come to pass. There is no question about the fact that we are in fiscal federalism and the basic principles of fiscal federalism are that there will be resource ownership and that attribution will be to those states which own the resources.

    “We have a reverse arrangement of federalism here; states own the resources but the Federal Government collects revenue on their behalf and begins to allocate funds.

    “We have a situation where a lot of states don’t contribute anything to the Federation Account. Now, what we are trying to do is to engineer a situation where revenue contribution to the national treasury will be widespread.”

    On his part, Chief Sola Ebiseni, a delegate from Ondo State, faulted the decision of the conference to refer decision on the matter to the government, saying that it shirked its responsibility.

    “As far as I am concerned, there was no decision taken today. What we did today was simply to abdicate our responsibility by throwing the issue back at Mr President, who sent us here to assist in proffering solutions to some of our national challenges.

    “What we fully failed to appreciate about what a national conference is that it is an extra-constitutional assembly of the people convened to critically examine all the issues that were pushed to us in a federation like ours, where we have to constantly review the terms of our national engagement as a country.

    “We now come to the tail end of considering a critical issue and then, we say we couldn’t take a decision and push it back to the President. That is a crafty way of maintaining the status quo and refusing to talk about it,” Ebiseni added.

    Analysts say that the derivation principle has always been a thorny issue in the country, describing the recent development at the National Conference as a mere replication of what happened at the 1995 Constitutional Conference.

    The current 13 per cent derivation for oil producing communities was agreed upon at the 1995 Constitution Conference, after a heated debate and threats from the mineral producing areas.

    All the same, concerned citizens advise state governments to exploit other sources of revenue, instead of depending solely on monthly allocations from the Federation Account for their survival.

    They insist that the current bickering at the National Conference would have been minimised if the states have been able to boost their internal revenue generation sources.

    Commenting on the impasse at the National Conference, Mr Issa Aremu, the Vice-President of the Nigeria Labour Congress (NLC), urged the delegates to refrain from taking hard-line positions on the country’s revenue sharing formula.

    Aremu, who is also a delegate, said that the impasse could have been avoided if the delegates allowed patriotism to replace parochial sentiments, while allowing national solidarity and cooperation for development to supersede unhealthy competition.

    “Delegates must look beyond the divisive revenue sharing formula to arrive at all-inclusive revenue growing/production formulae.

    “The truth of the matter is that we must grow this economy before revenue can be shared.

    “Oil and gas, which constitute the base of the derivation principle, is weak due to oil theft and relatively low exploration.

    “The challenge for delegates, including myself, therefore, lies in not just sharing what is not enough, but in growing what will be enough to build prosperity for our people.

    “We must complement distributive approach with production component to fiscal federalism,” he noted.

    Diversification as an option

    Apparently piqued by the rigmarole over the appropriate revenue sharing formula, Chief Elias Mbam, the Chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), emphasised the need for all the states to reduce their dependence on monthly allocations from the Federation Account.

    Mbam, who spoke at a zonal workshop organised by RMAFC on “Economic Diversification and Enhanced Revenue Generation for the South-South Zone” in Asaba in 2012, also underscored the need for Nigeria to reduce its over-dependence on oil revenue.

    He stressed that the goals of development programmes such as the Vision 20-2020 and the Transformation Agenda of the Federal Government could only be attained via the adoption of effective economic diversification strategies which could provide steady, sustainable sources of revenue.

    He, nonetheless, urged the three tiers of government and the private sector to make pragmatic efforts to exploit the vast natural resources which abound in all parts of the country.

    He also noted that tangible emphasis should be placed on the development of the agriculture, manufacturing, solid minerals and tourism sectors, stressing that the sectors held the key to Nigeria’s economic prosperity.

    Besides, Mbam stressed that challenges facing the country such as poverty, unemployment and insecurity, could be effectively tackled via the diversification of the economy to expand access to extra resources for the development of basic infrastructure and provision of vital social services.

    Experts therefore urge the federal, state and local governments to adopt sound economic proposals, particularly those that would enable them to diversify their revenue sources and depend less on monthly allocations from the Federation Account.

    Recipe for a vibrant revenue portfolio

    At a public forum in Uyo, Akwa Ibom state capital, recently, Dr. Casimir Anyawu, a Commissioner at the Revenue Mobilisation and Allocation and Fiscal Commission (RMAFC) noted that “The nation’s hope to become an economic super power come 2020 will continue to be a pipe dream if infrastructural inadequacies are not urgently addressed.  A Marshall Plan must immediately be designed for power, water, roads, railway etc. The problem of the “Generator Cartel” must be squarely addressed.  A ban on further importation of gen sets must be explored, if in the national interest. Leakages and wastages in current tax revenue collections must be plugged.”

    The RMAFC, he stressed, “must pay closer attention to the operations of the FIRS and the Department of the Customs.  The law requires that this be done. Revisit the policy on the Ban on some Used Products and make the initiative work in the national interest towards increasing the revenue base. The policy on revenue generated by MDAs is woeful.  It needs total re-examination.  The current model is prone to sharp and corrupt practices.

    “RMAFC must come to the rescue of LGAs from the stranglehold of State Governments.  Rural Nigeria cannot develop to the extent that allocations meant for that purpose are high jacked by State Governments. We must return to basics.  There is urgent need for a Marshall Plan for Agriculture, Solid Minerals, Manufacturing and Tourism.

    “Nigeria must learn from the Asian Tigers.  The key to their success is massive investment in Education, Science and Technology.  We must get our priorities right. Inconsistency in policy formulation and lack of continuity of programmes have resulted in undue waste of our national wealth.  Policy summersaults should be kept to a minimum.”

  • Mark seeks review of revenue formula

    Mark seeks review of revenue formula

    Senate President David Mark called yesterday for review of the revenue allocation formula to ensure “equity and fairness” in revenue distribution.

    Mark spoke in Abuja after the Senate confirmed Mr Emmanuel Olusanyan Omirin (Osun State) and Alhaji Shettima Umar Gana (Borno State) as members of the Revenue Mobilisation Allocation and Fiscal Commission (RMAfC).

    He noted that the perennial agitation for resource control among states was the result of the lopsidedness in the revenue allocation formula.

    Mark said: “It is one thing to qualify for an appointment but the more important thing is that when they get there, they must do what is right and ensure that our revenue allocation – even our revenue formula, which needs to be reviewed – is reviewed so that we can have some level of equity and fairness in revenue distribution.

    “As you all understand, the issue of resource control is because of the way revenue is distributed in this country. I think these two gentlemen, when they meet with the others, should be able to look into the revenue formula.”

    The confirmation of Olusanyan and Gana followed the consideration and approval of the report of the Committee on National Planning, Economic Affairs and Poverty Alleviation.

    The motion for the confirmation was moved by Olufemi Lanlehin on behalf of the Chairman of the Committee, Barnabas Gemade (Benue Northeast).

    Also yesterday, Mark urged the media to support the Federal Government’s campaign for peace and unity.

    Mark spoke in Abuja when the executive members of Senate Press Corps visited him on his 66th birthday.

    The Senate president noted that peaceful coexistence was the responsibility of every state.

    He said: “We should admit that we are faced with problems and we should work together to resolve our differences. The media have been active in this regards, but we need to do more because we can only achieve development in an environment of peace.”

    The Chairman of the Senate Press Corps, Mr. Cosmos Ekpunobi, hailed Mark’s leadership virtues.

    Also yesterday, Mark spoke of the need for Nigeria to partner Turkey in industrialisation and job creation.

    He spoke in Abuja when he hosted the Turkish Ambassador to Nigeria, Mustafa Pulat and a delegation from that country, according to a statement by his Chief Press Secretary, Paul Mumeh.

    Mark noted that both nations would gain from their bilateral relations.

    The Senate president urged Nigeria to emulate Turkey as a good example of a developing nation.

    He told Pulat and his delegation that Nigeria was an ideal investors’ destination.

    Mark said the fears of insurgency should not deter anyone from investing in Nigeria, adding that the Federal Government was tackling the menace.

    According to him, Nigeria is a multi-religious state, which upholds the sanctity of freedom of worship.

    He said religious differences among the people were not a challenge.

    Pulat said he was in Nigeria to strengthen the bilateral relationship to enable both countries benefit from it.

  • Fair revenue sharing formula will end nation’s woes, says ARG

    Fair revenue sharing formula will end nation’s woes, says ARG

    •Recommends 35 per cent for Fed Govt

    The pan-Yoruba group, Afenifere Renewal Group (ARG), has said a justified revenue allocation formula will solve some of the nation’s problems.

    ARG’s National Chairman Mr. Olawale Oshun spoke in Ibadan, the Oyo State capital, at the public hearing on the proposed review of the revenue sharing formula organised by the Revenue mobilisation, Allocation and Fiscal Commission (RMAFC) for the Southwest.

    Oshun said a fair revenue sharing formula would have contained the many complaints of the people.

    He noted that RMAFC had a crucial role in rescuing the nation from the precipice by presenting a formula reflecting true federalism.

    Oshun said people’s needs could only be addressed by local administrations, saying the Federal Government should not be allowed to hold on to 52 per cent of the revenue in the Federation Account.

    “There are about 193,000-kilometre roads in Nigeria, of which only 34,000 are federal. The larger burden of road maintenance falls on states. There are about 1,000 secondary schools in Lagos State and only about 10 belong to the Federal Government. Again, the need is at the state level. The same can be said for health facilities.

    “So, the Federal Government’s allocation must be reduced and some of its responsibilities devolved to states, whose percentage allocation must be increased to allow for purposeful governance.”

    The group proposed a sharing ratio of 35:65 between the Federal Government and states, arguing that there was no need to allocate anything to local governments which are “entirely under state”.

    On how to decentralise the Federal Government’s responsibilities, “ARG, citing agriculture said states are in a better position to implement agricultural policies than the Federal Government. It recommends that the portolios of the Federal Ministry of Agriculture” should be altered to retain only their research and policy functions. Then, their allocations can be turned into a Conditional Grant Scheme for states willing to buy into the Federal Government’s policies.

    “The same approach can be applied to decentralise the delivery of major public services, such as education, health and social services. This approach stands to benefit from the efficiencies associated with local administrations while serving important national objectives.”

    The group said special funds had made impact and should be cancelled. If need for such arises, it said the Federal Government and the affected appropriate state could decide on a counterpart funding arrangement.

    ARG recommended that derivation be increased from 13 percent to 25, arguing that the derivation principle should also be applied to the sharing of taxes such as VAT, etc.

    To bridge the developmental gap among states, it suggested an equalisation fund into which states would pay an agreed percentage of their Internally Generated Revenue (IGR).

    ARG said the fund would be “accessible by poor states only as a conditional grant for developmental projects”.

    Decrying the lack of accountability in governance, the group advocated independence of the RMAFC. It urged the commission to ensure that all revenues go into the Federating Account and condemned a situation where some agencies refuse to remit the money.

     

  • ‘Fed Govt frustrating new revenue sharing formula’

    ‘Fed Govt frustrating new revenue sharing formula’

    The Federal Government has been accused of frustrating the early release of the new revenue allocation formula.

    Investigations by The Nation at the Presidency and the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) indicated that the government is wary that the proposed new revenue formula will significantly slash its portion of expected revenue thereby denying it the much- needed cash to execute capital projects and run its beaurocracy.

    A source in the Presidency, who asked that his identity be veiled, said the thinking within The Presidency is that, “if the current sharing formula is tampered with, any shocks in the global economic system, like loss of revenue from crude oil exports, will adversely affect federal government’s spending with its widespread attendant consequencies”.

    The source admitted that the government may not come out openly to speak against the proposed new revenue formula, but suggested that the Federal Government could starve the RMAFC of funds to carry out the exercise on schedule.

    Investigations by our correspondent revealed that although it had initially given a tacit endorsement to the on-going review exercise, its latest stance appears to be lukewarm, thereby leaving the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) at the crossroads on the exercise.

    The Presidency source noted that the government was in a dilemma on the issue because, “it has been contending with deficit financing for many years along with the need to finance capital projects,” adding that “allowing the new revenue formula would mean more money being given to the states and local governments.”

    He said the bickering among the states,particularly the squabble over oil wells by oil producing states, boundary issues and the distrust between the North and South, have further reinforced the Federal Government’s position of the need for a strong centre backed with adequate financial muscle.

    At the centre of the controversy is the RMAFC which has spoken very little about the new revenue formula and has changed to advising State Governors on the need to explore Internally Generated Revenue (IGR), depend less on the monthly allocation from the Federation Account Allocation Committee (FAAC) by diversifying and exploring the economic potential in their states.

    The RMAFC’s  diversification campaign for increased IGR, which had taken the body to two geo-political zones, is being relaxed for lack of funds.

    When contacted, an official of the RMAFC said the commission was being starved of funds, but that since the Federal Government did not enlarge the commission’s purse in 2013 fiscal year, the commission was prepared to fight for more funding in 2014.

    According to the RMAFC official, the commission, “will ask for more recurrent vote in 2014 fiscal year. We are not happy with the current situation where capital votes are higher than recurrent votes even for agencies like our own with little capital projects to execute in the current fiscal year,” he stated.

    Addressing reporters in Abuja last week, Chairman of RMAFC, Elias Mbam, said the success of the review of the new revenue formula would depend on funding.

    He expressed optimism that the 2013 budget will address the funding challenges to allow RMAFC go to the zones and carry out workshops and receive inputs from stakeholders on the proposed new revenue formula.