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Expectations From New Revenue Formula
Thursday, April 7, 2022, the Chairman of Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), Elias Mbam, presented the report of the proposed new revenue allocation formula for Nigeria to President Muhammadu Buhari. This is coming 30 years after the last exercise was carried out in 1992, during the military regime of Ibrahim Babangida.
Highlighting the key recommendations in the report, Mbam said the proposed vertical revenue distribution formula suggested 45.17 per cent for the Federal Government, 29.79 per cent for state governments and 21.04 per cent for local governments. Under the current sharing arrangement, the Federal Government receives 52.68 per cent of the revenue share, the states get 26.72 per cent and the local governments 20.60 per cent.
Under the special fund, the commission’s report recommended 1.0 per cent for ecology, 0.5 per cent for stabilisation, 1.3 per cent for natural resource development and 1.2 per cent for the Federal Capital Territory (FCT). According to him, the new sharing formula was reached after extensive consultations with key stakeholders, public hearings across the country, administering of questionnaires, and a study of several other countries with similar fiscal structures to draw useful lessons from.
The commission also visited the 36 states, the FCT, and all the local government areas including the six area councils in Abuja to sensitise and obtain inputs from stakeholders, according to the RMAFC chairman. The chairman added that literature reviews were conducted on the revenue allocation formula in Nigeria dating back to the pre-independence duration.
Memos were reportedly received from the public sector, individuals and private institutions across the country. Mbam further noted that the country’s political structure had altered since the last review in 1992, with the addition of six more states in 1996, bringing the number of states to 36. At the same time, the number of local government councils also increased from 589 to 774.
The revenue allocation formula is the fraction of resources accruing to the federation that goes to each component of the nation. It also specifies the resources conserved in the areas where they are produced, as well as the proportions of the revenue accruing to the collecting agencies of government. The lack of justice and fairness in the distribution of the resources often results in tension and controversies in the polity.
President Buhari’s reaction to the new income distribution formula is commendable. In particular, he said he would await the outcome of the constitutional review process before submitting the report to the National Assembly. He assured the commission’s members that the Federal Government would conduct an internal review and approval process for the report shortly.
Buhari said, ‘‘Considering the changing dynamics of our political-economy, such as privatisation, deregulation, funding arrangement of primary education, primary health care and the growing clamour for decentralisation, among others, we must take another look at our revenue sharing formula, especially the vertical aspects that relate to the tiers of government.”
If the new revenue-sharing procedure gets approval, the Federal Government will have its allocation reduced by 3.33 per cent. However, the most important issue with Nigeria is not how revenue is shared, but the revenue itself. Nigeria’s revenue to Gross Domestic Product (GDP) is about 8 perc ent while the average for Africa is 18 perc ent. Hence, it is more productive to concentrate efforts on improving revenue generation across the board than the fixation on sharing. We have a huge revenue problem.
The National Assembly should step up efforts to amend the relevant section of the Constitution for quick implementation of the new revenue formula. The Federal Government must immediately subject the report to its review and approval processes. We hail RMAFC for the meticulous work in carrying out its constitutional tasks. Nigerians, particularly state and local governments, are applauded for contributing to this development through the extensive stakeholder engagement processes.
At the height of the negotiating process of the current minimum wage of N30,000, the states (under the aegis of the Nigeria Governors’ Forum), proposed a fresh formulation to give them more resources. Governors cited their inability to pay. However, most of the governors have been reckless with the allocations they have been receiving, resulting in several states owing workers’ salaries and pension arrears. While state and local governments deserve to get more, the derivation on natural resources should also be jacked up with legally binding provisions on regular upward adjustments.
Nevertheless, the new sharing format is not the universal remedy for Nigeria’s stunted economic outlook. For now, Nigeria is a poor country. The World Bank estimates its Gross Domestic Product at $375.8 billion, the largest in Africa, but it is a deceptive narrative. At 200 million, its population far outstrips that of any other country on the continent. Our nation has been described by the World Poverty Clock as the global poverty capital, where 93 million people live below the $1.90 per day threshold.
The continuous sharing of oil resources currently generated will not be of significant help. The three tiers of government will permanently be bogged down in a financial crisis, primarily because Nigeria’s current structure is a dangerous aberration. For the nation to be progressive and dynamic, equity and justice have to be promoted in our federal system. Also, the retrogressive culture of entitlement to oil revenue should end. Ideally, the states should strive to become centres of development.
Across Nigeria today, the consensus is that there is an urgent need to devolve more financial resources from the centre to the states and local governments. This is to ensure that the tiers of government can carry out their functions and improve economic growth and development. While we endorse that agitation, we strongly believe that Nigeria could only attain its dream of development by operating true fiscal federalism, where every tier of government generates its revenue and controls the bulk of it, just as it was in the First Republic.
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Benin Heads To Polls After Foiled Coup Attempt
Beninese voters headed to the polls yesterday in crucial parliamentary and local elections, just one month after a failed coup plot shook the West African country.
President Patrice Talon’s ruling coalition is expected to strengthen its already powerful hand in the ballots, with the main opposition Democrats party barred from the local polls.
The elections come at a fraught moment for Benin, still reeling from a deadly coup attempt by army mutineers on December 7, which was put down in a matter of hours by the military, with support from Nigeria and France.
The streets of economic capital Cotonou were calm yesterday as polling stations opened at 7:00 am local time (0600 GMT), AFP reporters said.
“I’m coming to vote early so I don’t have to deal with the midday crowds after church,” said restaurateur Adeline Sonon, 32, after casting her ballot.
The single-round legislative polls will elect the 109 seats in the National Assembly, where Talon’s three-party bloc hopes to strengthen its majority.
The Democrats, only running in the parliamentary races, risk ceding ground to the ruling coalition, which currently holds 81 seats.
Some observers say the opposition may lose all 28 seats, given the current electoral law requiring parties to gather support from 20 per cent of registered voters in each of the country’s 24 voting districts to stand for parliament.
The campaign unfolded without large rallies, with most parties opting for grassroots strategies like door-to-door canvassing.
“All measures have been taken to guarantee a free, transparent, and secure vote. No political ambition can justify violence or endanger national unity,” head of the electoral commission (CENA), Sacca Lafia, said on Saturday.
The legislative elections are set to define the political landscape ahead of April’s presidential polls, with the opposition struck off the ballot.
While Talon, 67, who is nearing the end of his second five-year term, is barred from running in April’s elections, his hand-picked successor, Finance Minister Romuald Wadagni, is a strong favourite to win.
Talon has presided over strong economic development across his nearly a decade in power, but critics accuse him of restricting political opposition and basic rights.
As of the time of filing this report, results of the polls have not been announced by the Benin electoral commission.
News
2026 Budget: FG Allocates N12.78bn For Census, NPC Vehicles
The Federal Government has allocated N12.78bn to the National Population Commission (NPC) in its proposed 2026 budget for census activities, construction of permanent office buildings, and vehicle procurement.
This is contained in the 2026 Appropriation Bill released by the Budget Office of the Federation.
President Bola Tinubu had on December 19, 2025, presented the budget estimate totalling N58.18tn to a joint session of the National Assembly.
According to the budget estimates, N770m is allocated for the ongoing National Population and Housing Census project, while N8.4bn is earmarked for the construction of permanent office buildings for the commission.
The purchase of official vehicles for federal commissioners is allocated N2.8bn.
The development of the National Population Data Bank, the Nigerian Population Database Management System, and the hosting of the population geo-portal and web portal are to receive N54.6m.
Preparation of the Enumeration Area Demarcation concept manual will cost N1.89m, while N17.5m is planned for the conduct of a second pretest.
Stakeholder conferences to present the 2018 census instruments are budgeted at N7m, while upskilling staff in data collection and interviewing techniques will cost N14m.
Census in schools is allocated N7m, while the development of a small-area lor enumeration-area-level database for spatial analysis and dissemination is set to receive N1.82m.
Field demarcation in 774 local government areas is budgeted at N1.4m.
Inter-censal population activities—including population projections, sentinel surveys, and the Nigerian Demographic and Health Survey—as well as the development of small-area-level databases for analysis, have been allocated N12.39m.
Census publicity and advocacy, including information campaigns through print and electronic media, are budgeted at N173.11m.
Monitoring and evaluation of commission projects will cost N28m, while research, documentation, and archiving—including studies on special populations such as herdsmen, fishermen, homeless persons, and migrant farmers—are also budgeted at N28m.
Cartographic consumables for the enumeration area demarcation exercise are allocated N1.61m.
Amendment of the NPC Act and prosecution of objections to the 2006 census results will cost N49m.
Expansion of registration centres and the registration of births and deaths are allocated N245m, while the generation of statistics on internal and international migration is budgeted at N24.5m. Population activity coordination in line with presidential directives will also cost N24.5m.
Additionally, specialised studies in demography, establishment of an e-library, and an annual population lecture series are budgeted at N35m, while the commemoration of World Population Day and the Annual Population Census Day is allocated N63m.
Budget preparation, verification of fixed assets, and the updating of financial documentation in line with IPSAS accrual accounting standards will cost N35m.
Nigeria last conducted a national census in November 2006, recording a population of 140,431,790.
Nearly 20 years later, the country is still struggling to complete preparations for a new count.
The planned census faced several setbacks under former President Muhammadu Buhari, including funding shortages, insecurity, and disruptions caused by the COVID-19 pandemic.
Despite moves by the NPC to deploy digital mapping and biometric systems to improve accuracy, the exercise was repeatedly postponed.
The 2023 census was eventually shelved due to financial constraints and the transition to a new administration, leaving much of the groundwork incomplete as Buhari exited office.
Under President Bola Tinubu, renewed attempts to revive the project have faced further challenges.
There is still no clear roadmap on the timing, methodology, or how to enumerate Nigeria’s large mobile populations, including internally displaced persons.
During a meeting with NPC officials on February 24, 2025, Tinubu expressed displeasure over the prolonged delays.
“This stop-and-go activity on the census cannot work with me. So we’d better have a definite path,” he said.
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FG Vows To Stop Striking Health Workers’ Salaries
The Federal Ministry of Health and Social Welfare has directed the stoppage of salaries of members of the Joint Health Sector Unions and the Assembly of Health Care Professionals following the commencement of their strike on November 14, 2025.
In a circular addressed to all Chief Medical Directors and Medical Directors of federal health institutions and dated January 8, the ministry said the directive was in line with the Federal Government’s “No work, no pay” policy and would take effect from January 2026.
The memo, signed by the Director of Hospital Services, Dr Abisola Adegoke, on behalf of the Coordinating Minister, instructed hospital managements to strictly enforce the policy against all striking JOHESU members and any other staff who might join the industrial action.
It partly read, “I am directed to convey to you the position of the Federal Ministry of Health and Social Welfare on the current strike by the Joint Health Sector Unions & Assembly of Health Care Professionals, which commenced on Friday, 14th November, 2025.
“You are to ensure that you provide critical services like accident and emergency, labour, Intensive Care Unit, amongst others by all legal means, including employment of locum staff.
“You may recall that the Federal Government law on ‘No work, no pay’ subsists in this regard. Therefore, you are directed to ensure strict enforcement of this policy on striking JOHESU members commencing from January 2026 and any group of employed staff in your institution who may wish to embark on strike.”
The ministry also ordered hospital heads to ensure that critical services such as accident and emergency care, labour wards and intensive care units continued to operate during the strike.
“You are also directed to ensure security of lives and property of everyone, including patients and staff. All members of staff who are willing to continue with their work must be allowed to go about their various duties unhindered and unmolested.
“You are to provide regular updates on the strike as it affects your institution,” the circular added.
The JOHESU strike, which began on November 14, 2025, involves health workers across federal health facilities and has affected the delivery of some medical services nationwide.
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