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Niger state Gov. Dr. Mu’azu Babangida Aliyu calls for review of Revenue Sharing Formula


Says all States are broke.
The governor of Niger state and former chairman of Governors Forum Dr. Mu’azu Babangida Aliyu has revealed that all the state governments in Nigeria are unable to meet all their financial obligations as he called for an urgent review of the revenue sharing formula.
Dr Babangida revealed this in a question and answer interview, published by a financial magazine,Economic Confidential, on Sunday.
Responding to a question on how true it is that states in the northern part of the country are financially broke and cannot meet their statutory functions, the governor replied in the affirmative saying “it is not only states in the Northern part of the country that are not in position to meet all their financial obligations; virtually all states in the Federation apart from probably Lagos and states in the Niger Delta areas are in the same boat.”

“In a nut shell I can say categorically that we don’t have enough resources to meet all our obligations to the people that voted us into office,” he quipped.
According to the governor who is also the Chairman of Northern Governor Forum, the introduction of the N18, 000 minimum wage was the major cause of the financial meltdown.
A number of state governments kicked against the wage, citing that a large chunk of their annual budget will go to payment of civil servant’s salary.
“The situation has been compounded by the introduction of a new minimum wage for workers in all the states of the country irrespective of the fact that we are in a federation and the poor internally generated revenue base of most states after the payment of salaries.”
“Most states have little or nothing to use for other projects” he added.
The governor also claimed that the affected states have been looking for other sources of funds to enable them meet their obligations.
“Some states have gone to the capital market to get money to finance capital projects dear to the people while others recourse to loans from commercial banks” he said.
The governor made a case for the review of revenue allocation, noting that the law that established the formula stated that the sharing formula must be reviewed every decade.
“As the case is now there is too much money at the centre (federal government) so we need to change the position because it is in the states and local government areas that we have the people” explained Dr Aliyu Babangida.
“I will still want the revenue allocation formula to be reviewed if for nothing it has outstayed its usefulness especially when it is the law that it should be reviewed every 10 years” he added.
The governor in the interview also called for a close monitoring of revenue generated from the nation’s oil wealth, noting that the oil wealth is “what most of us depend on.”
“Nobody today can tell you the exact amount of money accruing to the country from oil nobody knows the barrel of oil we exporting and at what cost.”
Referring to the revelations made by the House of Representatives probe into the fuel subsidy, as an eye opener into the apparent rot in the sector, the governor called on the federal government to immediately begin the prosecution of those indicted and ensure that amount illegally got is retrieved and given to all arms of government.
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