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Obasanjo advises RMAFC on revenue allocation formula review

By on September 4, 2013

A former President Olusegun Obasanjo on Monday in Abeokuta said the sharing of the nation’s revenue among the three tiers of government must be proportionate to the responsibilities they discharge.

Obasanjo said it had become imperative that   the responsibilities of each of the tiers of government were quantified in order to ensure a fair and equitable revenue sharing formula.

He said these when members of the Revenue Mobilisation Allocation and Fiscal Commission paid him a visit as part of the advocacy campaign on the proposed review of the current revenue sharing formula.

According to him, the items listed on the exclusive and the concurrent list of the Constitution must be quantified to determine how much of the nation’s resources should be allocated to each of the three tiers of government.

“We must be able to determine how much security, education or health cost and then determine how much should be allocated to each tier of government,” Obasanjo said.

He added that although the review of the current revenue sharing formula could be a herculean task, the exercise had become necessary in order to avoid a lopsided or disproportionate revenue sharing formula.

The former President noted that the review of the current formula would require the services of experts, urging the RMAFC to ensure that it engaged the services of consultants.

Obasanjo expressed concern at the previous failure by the commission to pay adequate attention to fund mobilisation.

He, however, reminded members of the commission that the RMAFC must not jettison the mobilisation aspect of its responsibility.

Obasanjo said, “I always want to emphasise the nomenclature of your commission and to stress that mobilisation comes before allocation.

“Please note that it is very important that you do not only concentrate on revenue allocation, but you must also seek to find out what the local governments, states and the Federal Government are doing to mobilise revenue.”

Obasanjo, who also commented on local government autonomy, noted that the third tier of government was first allocated funds directly from the centre in 1976 by the military administration under his leadership.

He stressed that the idea should neither be misconstrued as a mistake nor an accident, adding that the local governments were meant to operate as “governments” in the real sense of the word since they were the closest to the people.

According to him, the local government reforms of 1976 took into consideration criteria such as population, space and contiguity for the creation of local government councils.

He, however, regretted that successive military governments failed to take seriously such important factors in the creation of local governments.

Speaking earlier, the Chairman, RMAFC, Mr. Elias Mbam, said the commission members were in Abeokuta to consult with Obasanjo ahead of the review of the existing revenue sharing formula.

Mbam added that the commission would soon embark on public hearings in different zones on the matter.

He said, “We feel that we need to consult with you on such a sensitive national issue so as to tap from your wealth of experience.

“We have been meeting with other national leaders and critical stakeholders across the nation so as to come out with an acceptable formula.”

 

 

 

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