The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has raised the alarm that the Federation Account is over stressed.
By Nduka Chiejina
This RMAFC said is coming from the demands made on the account by the three tiers of government.
To reduce the stress on the Federation Account, the Chairman of the RMAFC Engr. Elias Mbam has called on state governments to develop strategies to boost their internal revenues.
Engr Elias Mbam made the call while receiving an Annual States Viability Index (ASVI) from the Editor-in-Chief of the Economic Confidential, Mr. Yushau A. Shuaib in his office in Abuja.
According to the RMAFC boss, the Federation Account Allocation is overstressed by the over-dependence of the tiers of government and hence the need for state governments to develop strategies to boost their internal revenues”.
The over-dependence in the monthly Federation Account Allocation, Engr Mbam said has made it imperative “for state governments to boost their internally generated revenues (IGR)”.
He said: “the annual ASVI report apart from providing a good source of information to the general public also has been identified as a source of information that would drive RMAFC on its mandate to encourage states of the federation to improve their Internally Generated Revenue.
“I have come to realize that Economic Confidential has become a household name and its reports that are factual and authoritative should be useful, especially in guiding states whose revenues keep dwindling so that they can improve.”
Speaking on the report, the Editor-in-Chief of the Economic Confidential, Mr. Yushau Shuaib said the ASVI report assessed and ranked States by their annual IGR in comparison to their receipts from the Federation Account Allocation.
He said the report has shown that “without the monthly disbursement from the Federation Account, many states cannot survive as the indices showed that seven (7) States are insolvent due to very poor IGR that were far below 10% of their receipts from the Federation Account”.
Mr. Shuaib stated that apart from Lagos and Ogun States that ranked high in the revenue generation in 2019, more states have recorded impressive and encouraging IGR in 2019 compared to 2018.
The report shows that only Rivers, Kaduna, Enugu, Kwara and Zamfara States did well with regards to impressive revenue generation in 2019 compared to their IGR in the previous year 2018 by improving more than 10%.