Problems of Revenue Allocation in Nigeria 1. Due to dissatisfaction by the states of the federation on the issue of revenue allocation, tensions have been on the rising side. The first system which we practiced during the First Republic allowed the North to keep the proceeds from its groundnut and cotton, the West to keep the proceeds from its cocoa, and the East to keep the proceeds from coal and oil produce. The various criteria that where used at any time, would seem favourable to some and unfavourable to others. What is the Continental Shelf? Formula for distribution between the Federal and State Governments. President as the relevant authority invoked his power under the provision of section 315 Sub Sections 1 and 4 to issue the Modification Order to bring the voided provisions into conformity with the provisions of the 1999 constitution. Equality of access to development opportunities, 6.
There are several systems of government currently being practiced all over the world. Of course, there is no doubt that this problem culminated in the death of Ken Saro-winea and eight other Ogoni people. The biggest state receives the biggest piece of funds. Then we changed the system so that the Federal Government got its hands on the proceeds from on-shore and off-shore crude petroleum proceeds, and yet we don't expect the minorities in the oil-producing areas to perceive that is an injustice done to them. Akinwunmi Ambode urged the national assembly to discuss the matter of federalism in Nigeria. It leverages power and determines public policy and revenue allocation as areas with higher population are entitled to a greater share of the national resources in terms of state creation, representation and other national consideration.
Goodluck Jonathan in January, 2014. General Medicine… 3775 Words 16 Pages effectively distribute oil revenues in an equitable manner. It can also be seen as the mutual suspicion and strife arising among group of people regions or countries as a result of political activities. In the 90s the formula was reduced to one percent 1% derivation. In the 70s then, there was derivation principle that stipulated fifty percent 50% derivation. It is obvious that many factors accounts for these controversies over revenue allocation. Just look at the number of the revenue allocation commissions! However, the Commission was not granted audience to submit its recommendations to President Jonathan up to the end of his tenure in May, 2015.
The most important origin in making Nigerian poverty history is slavery. The politics of revenue allocation even in the present democratic dispensation has been so contentious that a week after, the Special Committee headed by House Leader, Abdul Ningi had to undertake Public Hearings between August 28 to30, 2006 across the six geopolitical zones. Establishment of Federation Account Allocation Committee and functions 1 There is hereby established for the Federation, a body to be known as the Federation Account Allocation Committee which shall comprise the following members, that is to say- a the Federal Minister of Finance to be chairman thereof; b the Commissioner for Finance of each State in the Federation; c two persons to be appointed by the President; and d the Accountant-General of the Federation. Nigeria is a federative country consisting of 36 states. Hence it is limited to the tension it has generated in the oil producing areas. What is the rationale behind vehement agitations for increased revenue allocations in some parts of the country, e.
Several factors were considered in arriving at this revenue sharing formula. Food Services The Hospital also has three patient care units: 1. These problems come from various issues, like social, cultural, geographical, political and economic. This has led to the establishment of various revenue allocation commissions. There was four 4 military decrees. Data can be used to account for the many dimensions of the population such as age, sex, literacy and so on.
Revenue sharing in a federal state is that each level of government receives an allocation of financial resources tailored to their specific requirements as defined by the mandate of legislature competence. The various commissions, laws and Decrees of revenue allocations had arisen because of the continuous disagreement of sections of the country, with the way national resources where divided. During the reign of Caesar Augustus, several tax reforms were carried out by the Roman government. As a result, more than 3. Oil theft in Nigeria presents a big problem. The states with the biggest amount of resources — get the biggest funds. Again, the 5th National Assembly could not conclude deliberations on that sensitive matter up to the end of the Obasanjo administration in May, 2007.
For today, the latest revenue allocation formula was adopted in 2015. Short title This Act may be cited as the Allocation of Revenue Federation Account, etc. According to the Nigerian Revenue Mobilization Allocation and Fiscal Commission, a new revenue allocation formula is in the works, but it remains to be seen if these measures are enough to remedy the problem. Agriculture, for instance, was a major source of revenue for the Western Region. This has led to the demise of the other productive sectors of the economy. All of these policy options would solve the inefficiencies in the current allocation rates. Revenue allocation is defined as the division of available resources within an organisation or company.
First, it begins with a review of alternative technologies used in both legacy and modern system. Conversely, the issue of revenue allocation in Nigerian has brought untold challenges to the socio-economic development of this nation, as most states of the federation were rendered incapacitated in meeting to their constitution responsibilities. . The organization reviews and advises the formulas and principles of allocation to adjust for changing fiscal circumstances. The advice and recommendations were promptly forwarded to the 4th National Assembly for deliberations.