Economic Confidential

...Akwa Ibom to pay Rivers State N10.91bn

Good News came the way of the 36 State and 774 Local Governments as the the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) said a new equitable and just revenue sharing formula will be in place by first quarter of 2012.

In the last couple of months, there have been serious agitations by state governors and local government chairmen for new revenue allocation formula to replace the existing one variously described by stakeholders as a military creation that is outdated and not in tune with the realities of today’s economic development and challenges in the country.

Similarly, the Commission said the Akwa Ibom State government is to refund the sum of 10.91 billion Naira to its River State counterpart based on the recommendations of the committee established to implement the Supreme Court judgment on disputed oil wells between the two states.

Chairman of the Commission, Engineer Elias Mbam said the new sharing formula would hopefully redress the obvious imbalances and lapses noticeable in the current formula.

Speaking when he received the Report on the implementation of the Supreme Court judgment in the case of Attorney General of Rivers State Versus Attorney General of Akwa Ibom state and Attorney General of the Federation, Engineer Elias said a new formula was desirable and long overdue.

He said on assumption of duty as chairman of the Commission, a committee was put in place to evolve ways of formulating a new revenue allocation for all three tiers of government. According to the RMAFC Chairman, the responsibility packaging a new formula was quite tasking as it involves consulting series of documents and relevant stakeholders as well as embarking on field trips to verify some of the indices being flaunted by states and local governments to back up their agitations.

Engineer Mbam promised that the Commission would keep to its 2012 first quarter deadline to present a new sharing formula, stressing the plenary session of the commission would look into the report carefully and with all due diligence in order to come up with something that would be implemented to the satisfaction of all stakeholders.

Commenting on salary and allowances for the National Assembly (NASS) members, the Chairman said remuneration due to them were already published in the Commissions website, citing that by the existing salary package, a Senator’s monthly salary currently stand at 1.06 million Naira.

He said any Senator that goes home with any amount higher than the official figure should be reported to the Clerk of the NASS as the Chamber’s accounting officer and added that the same goes for members of the House of Representatives.

Presenting the report, Chairman of the Committee, Alhaji Abdullahi Maianguwa said the body set up on April 13, 2011 relied on documents, data and technical information provided by various agencies and institutions of governments to reach conclusions and make its recommendations.

He said in carrying out the assignment, the Committee got relevant data on the controversial 86 oil wells attribution from the National Boundary Commission (NBC), in conjunction with the Office of the Surveyor General of the Federation and their respective production data from the Department of Petroleum Resources.

Alhaji Maianguwa said the Office of the Accountant General of the Federation (OAGF) also provided all documents required on the 13 per cent derivation Fund during the period under consideration by the Committee with the Central Bank of Nigeria (CBN) providing necessary information on interest rates to be applied for the purpose of the delivering on the assignment.

He said computation of the amount due to Rivers state covered the period from April 2009 to April 2011, noting that the committee discovered that Akwa Ibom state would have to refund the sum of 10.910 billion Naira to River state based on the existing indices.

The Committee boss said the amount was not inclusive of the prevailing commercial interest to be charged as they were still waiting on the CBN to come up with the rate to be charged.

It would be recalled that Chairman of State Finance Commissioners Forum, Malam Rabo Usman at the last Federation Accounts Allocation Committee (FAAC) meeting in Abuja, said it was unjust for the Federal Government to keep 52.68 per cent of the nation’s revenue while the states with all their developmental burdens go home with only 26.72 per cent of the revenue every month.

He said the personnel cost of the states put together far outweigh that of the Federal Government and the time has come for an urgent review that would see the states carting home a larger chunk of the monthly revenue in line with the realities on ground.