New Revenue Sharing Formula Clamour by the Nigerian State Governors: Propelling Factors and Matters Arising

Abstract

The Niger State Governor Mu'azu Babangida Aliyu recently blamed the existing revenue sharing formula among the tiers of government for the growing imbalance in development strides in the Northern states compared with the rest of the states. In his words, the relative poverty of the (Northern) region was attributable to the country's system of revenue allocation, which, he said, unduly favoured the littoral states that get additional 13 per cent from the Federation Account on the basis of the derivation principle. Embitteredly, he complained that the Niger Delta states also get the 13 per cent derivation from offshore exploration which ought to belong equally to all the constituent units of the federation. He however lambasted the current revenue sharing formula which gives the federal government 52.8 per cent and described it as abnormal, because both the states and the local governments share only 47.2 percent. Expectedly, this has generated a heated debate as one of the touchy issues in the country's acrimonious geopolitics with its characteristic finger-pointing, grandstanding, stereotyping and ethnic/regional posturing to the extent that the Governors forum, led  by the Lagos state Governor, Babatunde Fashola have thus proposed a new revenue allocation formula that will checkmate the excessiveness of the federal government in terms of their allocation, fiscally and otherwise and then empower the states to function viably and pacify the northerners who also have problem with the current revenue sharing formula. The possibility of this clamour succeeding is the thrust of this paper.

Keywords: federalism, fiscal federalism, resource control, revenue allocation, sharing formula