The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has completed its comprehensive review of Nigeria’s Revenue Allocation Formula, clearing the way for a revised framework for distributing revenues among the federal, state and local governments.
Chairman Dr Mohammed Bello Shehu disclosed this on Saturday during an interactive session with members of the Nigerian Guild of Editors in Lagos. He said the exercise involved extensive consultations with the three tiers of government, technical stakeholders and relevant institutions. It assessed fiscal responsibilities, revenue trends and comparative federal systems, producing a harmonised report and legislative proposals now ready for transmission to the appropriate authorities.
The objective, Shehu said, is a more equitable and sustainable revenue-sharing system that reflects current economic and governance realities.
He also announced that the commission has concluded the review of remuneration for judicial office holders, resulting in the enactment of the Judicial Office Holders (Salaries and Allowances) Act, 2025. The parallel review covering executive and legislative office holders is at an advanced stage, with an executive bill for the Political and Public Office Holders (Salaries and Allowances) Act, 2026 expected to be sent to the National Assembly.
“Remuneration reforms must be matched with accountability and performance. Improved pay should translate into improved service delivery,” Shehu stated.
Beyond the formula and pay reviews, the chairman said RMAFC has stepped up monitoring of oil and gas production data to ensure accurate application of the 13 per cent derivation principle. The commission has used verification exercises, geospatial mapping and inter-agency collaboration to resolve discrepancies in oil-well attribution.
A key intervention involved the reallocation of 17 oil wells from Imo State to Rivers State in line with a Supreme Court judgment. Similar actions have been taken in Cross River, Akwa Ibom, Imo and Anambra states, while improved gas production reporting has enabled Enugu and Kogi states to benefit from derivation revenues.
RMAFC has strengthened partnerships with the Nigerian Upstream Petroleum Regulatory Commission, NNPC Limited, the Nigerian Midstream and Downstream Petroleum Regulatory Authority, the National Boundary Commission and the Office of the Surveyor-General of the Federation. It is also engaging the Ministry of Defence on crude oil theft, pipeline vandalism and production losses.
Looking beyond petroleum, the commission is exploring collaborations with the Federal Airports Authority of Nigeria and the National Space Research and Development Agency, including the use of satellite and geospatial technologies to identify new revenue opportunities.
Shehu added that RMAFC has improved its institutional infrastructure through facility rehabilitation, enhanced security and ongoing headquarters renovation, while expanding staff training and healthcare support.
The engagement with editors, he said, forms part of efforts to increase transparency around the commission’s constitutional mandate of monitoring Federation Account revenues, reviewing the allocation formula and determining appropriate remuneration for public office holders.
The completed formula review comes amid ongoing pressure on Nigeria’s fiscal structure from rising expenditure, uneven revenue generation and demands by states and local governments for greater fiscal capacity. It now positions the Federal Government and National Assembly to consider possible changes to the distribution of federally collected revenues.
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