The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) says the revenue allocation formula currently in operation is legal.
The commission’s Spokesperson, Mr Ibrahim Mohammed said this in a statement on Monday in Abuja.
He said that there had been allegations that the current revenue allocation formula was illegal on the grounds that it was never submitted to the National Assembly by former President Olusegun Obasanjo.
The Commission recalled that the first Revenue Allocation Formula duly passed by the National Assembly was in 1982, during the Second Republic of former President Shehu Shagari.
“After the military take-over, the Act was amended by Decree No 106 of 1992 which continued to operate up to 1999.
“It is instructive to note that with the return of democratic rule in 1999, all laws were considered as existing laws as provided for by Section 313 of the 1999 Constitution and, therefore, Acts of National Assembly which apply to the extent that they conform to the provisions of the Constitution.”
He said that following the Supreme Court ruling in Attorney-General of the Federation vs Abia and 36 others, which voided some of the provisions of CAP 16 as (amended), Mr President as the relevant authority invoked his power under the provision of Section 315 Sub Sections one and four.
He said this was to issue the modification order to bring the voided provisions into conformity with the provisions of the 1999 constitution.
“Consequently, the president and the governors met and resolved some grey areas in the provision of the modification order, hence the implementation directives released by the Minister of Finance, Dr Ngozi Okonjo-Iweala on Jan. 15, 2004, which is the formula currently in operation.
“Furthermore, the commission had in August, 2001, reviewed the revenue allocation formula and submitted its report and recommendations to President Olusegun Obasanjo.
“The advice and recommendations were promptly forwarded to the fourth National Assembly for deliberations.”
Mohammed said the commission had cause to withdraw its recommendations to make some necessary adjustments because the Supreme Court Judgment of April 5, 2002 had actually affected some of the recommendations as proposed by the commission in its 2001 report.
He said that after the review, the report was subsequently re-submitted to President Obasanjo in Dec. 2002, and then forwarded to the fourth National Assembly.
“Unfortunately, the fourth National assembly could not conclude deliberations on the matter up to the end of the first tenure of President Obasanjo in May, 2003.
“Again, the fifth National Assembly could not conclude deliberations on that sensitive matter up to the end of the Obasanjo administration in May, 2007.
“When the sixth National Assembly came, the commission was informed that all bills including that of the revenue allocation formula not passed by the fifth National Assembly have lapsed and therefore, should be re-submitted.”
Mohammed said that following the development, the commission prepared another revenue allocation formula report in Dec. 2013, which was duly communicated to former President Goodluck Jonathan in Jan. 2014.
He, however, said that the commission was not granted audience to submit its recommendations to President Jonathan up to the end of his tenure in May 2015.
“The current administration had also been informed of this development,’’ he added.
Under the current sharing formula, the Federal Government is allocated 52.68 per cent of revenue from the Federation Account, while states are allocated 26.72 per cent and the 774 local governments 20.60 per cent.
An Ad Hoc Committee of the House of Representatives had described the current revenue sharing formula as illegal on the basis that there was no evidence that it received approval from the National Assembly. (NAN)
