Revenue allocation formula outdated, needs urgent review – Osita Okechukwu
A foundation member of the All Progressives Congress (APC), Mr. Osita Okechukwu, has thrown his weight behind the planned review of Nigeria’s Revenue Allocation Formula, describing it as long overdue.
Okechukwu, a former Director-General of the Voice of Nigeria (VON), spoke with journalists on Tuesday shortly after the Chairman of the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), Mohammed Bello Shehu, announced plans to revisit the existing sharing structure.
He described the proposed review as a “win-win balanced federalism via fiscal restructuring,” stressing that it was particularly timely as Nigeria undertakes constitutional alterations.
According to him, the current formula, which allocates 52.68 percent of federally collected revenues to the Federal Government, 26.72 percent to states, 20.60 percent to local governments, and small fractions to special funds, has outlived its usefulness after 33 years. He argued that it promotes centralisation and fuels political tension.
“My observation over the last decades is that the political banditry, ultra-nepotism and tension-soaked presidential elections in our dear fatherland are largely due to unbalanced federalism,” he said. “The struggle over who presides over the huge oil revenue at the over-centralised federal government has been a do-or-die affair.”
Okechukwu therefore recommended a new formula of 40 percent for the Federal Government, 40 percent for states, and 10 percent each for local governments and other special funds. He explained that local governments deserved less than the current 20.60 percent due to persistent failures to secure their autonomy from what he described as the “stranglehold of emperor governors.”
He acknowledged that past efforts at revenue allocation reviews had been mired in controversy and divisive rhetoric, urging Nigerians to set aside ethno-religious sentiments and focus on tackling poverty, unemployment, inequality, and insecurity, which he said affect all geopolitical zones.
The APC chieftain appealed to President Bola Tinubu, state governors, and lawmakers at both federal and state levels to support the review, saying it was necessary to entrench balanced federalism and strengthen grassroots democracy.
