The Senate on Tuesday initiated steps to amend the 1999 Constitution to raise the Federal Government’s share of revenue from the Federation Account, saying the current formula no longer matches the scale of responsibilities handled by the centre.
The proposed constitutional change comes amid renewed discussions on fiscal federalism, following criticism from labour unions, civil society organisations, and opposition figures who argue that higher allocations to states have not improved citizens’ welfare.
Under the existing revenue allocation formula, the Federal Government receives 52.68 percent of federation revenue, the 36 states receive 26.72 percent, while the 774 local government councils share 20.60 percent.
Despite already receiving the largest portion, the Senate, through a bill sponsored by Senator Sunday Karimi of APC, Kogi West, is pushing for an increase in the Federal Government’s allocation.
The bill passed its first reading at plenary and seeks to amend constitutional provisions governing revenue distribution among the three tiers of government.
“The proposed alteration seeks to increase federal government revenue allocation to address mounting financial obligations and national responsibilities across Nigeria.
“The current revenue sharing formula is outdated and unsustainable because it places excessive financial pressure on the federal government amid rising infrastructure decay and insecurity nationwide,” he stated.
Karimi said there was an urgent need to revise the formula to grant the Federal Government a higher share so it can effectively carry out its statutory duties.
“There is a need for adjustment in the revenue allocation coming to the Federal Government so that we can have a slight increase in what is coming to the Federal Government for it to meet its responsibilities,” he said.
He explained that limited funding has continued to hinder the maintenance of federal roads and efforts to combat banditry and terrorism nationwide.
“Responsibilities borne by the Federal Government, particularly the construction and maintenance of federal roads across the country, have become overwhelming under the existing revenue formula aside from the enormous responsibilities on internal security.
“So what is needed now is an adjustment in the revenue allocation formula to increase the federal government allocation,” he added.
Karimi expressed optimism that an increased allocation to the Federal Government would strengthen Nigeria’s ability to tackle insecurity and address infrastructure decay.
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