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RMAFC begins consultation on revenue allocation formula

Lagos State Governor, Babajide Sanwo-Olu has called on participants at the ongoing two-day public hearing by the Revenue Mobilization Allocation and Fiscal Commission, RMAFC, for the South West zone to handle the national assignment with an open mind to ensure that the right parameters are factored into the historic process.

Governor Babajide Sanwo-Olu made the call while declaring the public hearing open in Victoria Island area of the state.

Governor Sanwo-Olu told the participants that the best way to guarantee national development is by paying attention to subnational development, because the national is a summation and a reflection of the subnational.

The Governor who described the event as a welcome development, noted that the public hearing will guide the Commission in effectively discharging its constitutional mandate with ease.

He stressed the need for a new revenue sharing formula among the three tiers of government is very straightforward and self-justifying, and in no way controversial.

“Our demand is a sharing formula that is just, fair and equitable; reflecting the contribution of stakeholders to the common purse; and also one that enhances the capacity of State and Local Governments to deliver high-quality services and the full dividends of democracy to the greatest number of our people” Governor Sanwo-Olu stated.

Governor Sanwo-Olu also used the opportunity to renew the call for Lagos state to be accorded a special status in recognition of the huge financial commitments to infrastructure and provision of basic amenities for the increasing population of its residents, and its contribution to the national coffers.

“Lagos State is no doubt the nation’s commercial capital, and population center. The level of funding required to service the State’s social and public infrastructure is so significant that it will be difficult for the State to bear the burden for much longer under the present arrangement. I should say that it will actually be unfair to expect the State to bear this heavy burden on its own. It is therefore necessary to give due consideration to all the variables that support our advocacy for a Special Status” He emphasized

In a remarks, RMARC Chairman, Mr. Elias Mba said the public hearing would also be replicated in the other five geo-political zones.

Mr. Mba explained that the Commission had also placed advertisements in the media calling for memoranda on the review of the allocation formula from stakeholders and assured participants that justice would be done to their submissions

“The Commission had commenced the process of reviewing the subsisting Vertical Revenue Allocation Formula in line with changing realities. The last review was in 1992. In view of the the sensitivity and it’s Socio-economic importance, the review has become necessary to ensure fairness, justice and equity” Mr Mba stated.

In an address of welcome, the Lagos State Commissioner for Finance, Dr Rabiu Olowo, said that the current sharing formula can no longer subsist.

Mr Olowo canvassed the introduction of population density as a matrix for the revenue sharing formula.

The Commissioners for Finance from Ogun, Oyo, Osun, Ekiti and Ondo States who also made submissions highlighted the needs for a review of royalties from natural resources as well as the revenue allocation sharing formula in a way that the Federal government would take 35%, States should be allocated 40%, while Local Governments should get 25%, as well as the review of special funds for states amongst other recommendations.

The public hearing continues on Tuesday with interest groups expected to make their own submissions.

Reporting by Omolara Omosanya, Edited by Adeniyi Bakare