Nigeria’s Revenue Allocation Formula Review: Gov. Namadi Calls for Fairness as RMAFC Begins Nationwide Data Verification

By Ali Baba-Inuwa, Expert Editorial Review

In a significant step toward reshaping how Nigeria distributes its national wealth, Governor Umar Namadi of Jigawa State has expressed strong hope that the ongoing review of the country’s revenue allocation formula by the Revenue Mobilization Allocation and Fiscal Commission (RMAFC) will be anchored on the principles of fairness, equity, and justice for all states and stakeholders. The Governor’s remarks came during a meeting with a delegation from the Commission, led by Barrister Imo Effiong Akpan, the Federal Commissioner representing Akwa Ibom State, at the Government House in Dutse.

Why This Revenue Formula Review Matters

Nigeria’s revenue allocation formula determines how funds collected from sources like oil, taxes, and customs duties are shared among the federal government, state governments, and local government councils. The current formula—often criticized for being outdated—has been a source of tension between states, especially as population growth, infrastructure demands, and economic disparities have shifted dramatically since the last major review. For example, states with rapidly growing urban centers like Lagos or Kano argue for a larger share based on population, while rural states like Jigawa emphasize the need for equity to address underdevelopment.

The RMAFC’s Nationwide Data Verification Exercise, which the delegation was in Jigawa to formally commence, is a critical component of this review. It aims to collect and verify current data on population, infrastructure, and developmental realities across all 36 states and the Federal Capital Territory. Without accurate, up-to-date data, any revenue formula risks perpetuating historical inequities—such as over-relying on outdated census figures from 2006, which many experts argue no longer reflect Nigeria’s demographic landscape.

Governor Namadi’s Call for Fairness and Historical Context

Governor Namadi described the exercise as “timely and necessary,” given the changing socioeconomic realities across the country. He commended the Commission for initiating the process, noting that previous attempts to review the revenue allocation formula had failed to achieve desired outcomes. “The bold attempt by the Commission to review the revenue allocation formula is something to be appreciated because several attempts were made in the past without success,” he stated. “But with the determination demonstrated by the current leadership, we are optimistic that this exercise will succeed, Insha’Allah.”

This optimism is rooted in the recognition that past reviews—such as those attempted in 2001, 2008, and 2013—stalled due to political disagreements, lack of political will, or insufficient data. For instance, the 2013 attempt by the RMAFC to increase the share of local governments from 20.6% to 23% was met with resistance from state governors who feared losing control over funds. Namadi’s endorsement signals a potential shift in state-level cooperation, which is essential for any reform to pass through the National Assembly.

Practical Example: How Data Verification Could Change Allocation

Consider a state like Jigawa, which relies heavily on agriculture but has limited industrial output. Under the current formula, the state receives a fixed percentage based on population (about 40% of the allocation), equality (30%), and other factors like landmass and social development (30%). However, if the data verification reveals that Jigawa’s population has grown faster than previously recorded—or that its infrastructure deficit is more severe—the state could argue for a larger share of the “social development” component. Conversely, a state like Rivers, which produces oil, might see its share reduced if the formula shifts toward need-based criteria rather than derivation (the principle that resource-producing states get a larger cut).

RMAFC’s Commitment to Transparency and Best Practices

Earlier, Barrister Imo Effiong Akpan explained that the Nationwide Data Verification Exercise is designed to ensure that the data used for revenue allocation accurately reflects current realities across the federation. He highlighted that changing population dynamics, infrastructure expansion, and developmental realities across states make periodic review and verification necessary to guarantee fairness and equity in the sharing of national resources. “We are committed to conducting this exercise with professionalism, transparency, and objectivity in line with best practices,” Akpan assured the Governor.

This commitment is crucial because past data collection efforts have been plagued by allegations of manipulation or incomplete coverage. For example, during the 2006 census, some states accused the National Population Commission of inflating figures to favor certain regions. To avoid such controversies, the RMAFC has pledged to use a combination of satellite imagery, ground surveys, and cross-referencing with state government records. The Commission is also expected to publish preliminary findings for public scrutiny before finalizing the formula.

What This Means for Nigerians

For the average citizen, the outcome of this review could directly impact the quality of public services. If states receive more funds based on verified needs—such as the number of schools, hospitals, or roads—they may be better equipped to address local challenges. For instance, a state with a high number of out-of-school children could receive additional resources for education, while a state facing an infrastructure deficit could prioritize road construction. However, critics warn that without strong accountability mechanisms, increased allocations could be mismanaged, as seen in past cases of corruption at the state level.

Looking Ahead: Challenges and Opportunities

While Governor Namadi’s support is a positive sign, the road ahead is fraught with challenges. The RMAFC must navigate political pressures from powerful states that benefit from the status quo. Additionally, the Commission needs to complete the data verification across all 774 local government areas within a tight timeline—a logistical nightmare given Nigeria’s poor road networks and security concerns in some regions. Yet, if successful, this review could set a precedent for more transparent and equitable resource sharing, potentially reducing regional tensions and fostering national unity.

Governor Namadi concluded by assuring the Commission of the Jigawa State Government’s full support and cooperation throughout the exercise. “We are confident that there will be fairness in this exercise. We believe everybody will be treated fairly according to the standards expected,” he said.

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