Why RMAFC deserves better funding

By Kayode Oluwaseun

Revenue Mobilization Allocation and Fiscal Commission (RMAFC) is one of the Executive bodies established by the 1999 Constitution of the Federal Republic of Nigeria (As Amended).

Amongst its fundamental powers and functions are; to monitor the accruals of federally-generated revenues to the Federation Account and disburse same to the three tiers of government; review from time to time, the Revenue Allocation formulae and principles in operation to ensure conformity with changing realities, determine remuneration packages appropriate for political, public and judicial office holders as well as advise governments at all levels on the ways to improve their internally-generated revenues.

It is instructive to note that the review process of the above exercises involves extensive and in-depth research and studies in various areas of the country’s political economy, call for memoranda, consultations, sensitization workshops, collection and collation of data, studies of other similar Federations in respect of fiscal arrangements, public hearings and administration of questionnaires which involves huge expenditure.

It is worth emphasizing also that these exercises normally take the Commission to all the 36 states of the Federation and the FCT, as well as the 774 Local Council across the country to sensitize Nigerians to make input into the review process.

In the area of reducing revenue leakages and enhancing revenue generation, the Commission, has succeeded in curbing huge revenue leakages and expanding the sources of revenue to the Federation Account through the recoveries of hundreds of billions in the recent past.

The revenue generating agencies monitored by the Commission are digitalized using sophisticated revenue collection software. In contrast, the Commission that is constitutionally mandated to monitor revenue accruals from these Agencies is still operating manually due to the absence of critical Information and Communication Technology (ICT) infrastructure.

Hence, it is difficult for the Commission to track revenue generated by these agencies on a real-time online basis and report accurately to Government. In order to effectively monitor and prevent revenue leakages, the Commission needs to deploy a robust ICT infrastructure to build and link the internet portal with all Revenue Generating Agencies for online real-time monitoring.

It is gratifying to note that in order to ensure synergy in revenue generation, remittance and monitoring, the Commission also continues to engage critical stakeholders like the Federal Ministry of Industry, Trade and Investment, the Customs Service, Federal Inland Revenue Service, Nigerian National Petroleum Company (NNPC) and its subsidiaries and the Central Bank of Nigeria to strategize on how to reduce revenue loss through indiscriminate granting of waivers and tax holidays.

Given the important role, the Commission plays in the nation’s political economy through statutory allocation of revenue via an equitable revenue sharing formula to the three tiers of government and fixing remuneration for public, political and judicial office holders at all levels of government, RMAFC has enormously contributed to the democratization process, thus encouraging good governance, transparency and accountability and even development in the country.

However, in spite of its enormous responsibilities and as one of the fourteen (14) Executive Bodies recognized by the Constitution, it is lamentable that RMAFC remains one of the most poorly funded Agencies compared to other sister Constitutional bodies like Independent National Electoral Commission (INEC), National Population Commission, National Association of Secretaries of State (NASS) and others that are heavily funded from the national purse.

One of the major challenges faced by the Commission is the absence of financial autonomy and weak regulatory framework which directly hinders the effective and efficient performance of its operations with annual budgetary allocations for the financing of its activities over the years being grossly inadequate as to protect its independence and cater for its nationwide field operations. The sensitive nature of the Commission’s role in Nigeria’s Fiscal management requires a large measure of independence including financial autonomy.

In order to guarantee adequate and steady funding and proper enforcement mechanism through the amendment of legal and regulatory framework that will strengthen the effective functioning of the Commission, all critical Stakeholders must support the quick passage of the RMAFC Amendment Bill before the national assembly and the assent of Mr. President when it finally gets to his table. This is because, the existing RMAFC Act, CAP R7 LFN 2004 has become obsolete and is no longer in consonance with the economic and fiscal realities.

It would be recalled that the 9th Assembly at the twilight of the last administration had graciously and expeditiously passed the bill that was expected to give the beleaguered Commission a new lease of life. The 10th Assembly had dusted the old bill and is now giving it expeditious attention where it has gone through second reading awaiting the final stage.

The National Assembly and all major Stakeholders are of the opinion that since the RMAFC is a creation of the Constitution for the Federation, it is only logical and imperative that its funding requirements should be borne by the 3-tiers of government instead of the current envelope budgetary system by the Federal Government.

The proposed Bill calls for an act to amend the Revenue Mobilisation Allocation and Fiscal Commission Act, CAP. R7 LFN 2010 to grant the commission enforcement powers in the monitoring of accruals to and disbursement of revenue from the Federation Account and bring the Act in conformity with the provisions of the 1999 Constitution (as Amended); and for other matters related therewith.

It would be recalled that the Center for Anti-Corruption and Open Leadership (CACOL) and a coalition of civil societies had in a press statement earlier noted with dismay that, while the Commission continues to discharge its constitutional responsibilities assiduously with little resources, workers and their chief executives in the various revenue generating Agencies it supervises, luxuriate in humungous salaries and allowances driving state-of-the-art cars as official vehicles, working in spacious and well-equipped offices and attending conferences, seminars and retreat abroad all at the tax payers expenses.

CACOL Chairman, Debo Adeniran, quipped, “In all honesty, how do you expect RMAFC to effectively monitor those Agencies without being ridiculed given the impoverished working conditions of their staff, how can the Commission attract top rate graduates and experienced hands like those in the MDAs they are supposed to oversight, how can they deploy top-notch ICT infrastructure like those obtained in FIRS, Customs, and NNPCL?”

“It is maladroit to expect a poorly funded organization with ill-motivated staff to perform supervisory functions on well-funded agencies whose staff are adequately remunerated and highly motivated”.

The CACOL Statement stressed that in view of the overriding importance of RMAFC’s role in stabilizing the nation’s political and socio-economic development since inception, there is the need to adequately fund the Commission through increased budgetary allocation so as to enable it to effectively supervise revenue generating agencies such as FIRS, NNPCL, Customs as well as carry out its other constitutional duties.

It is the expectation of all and sundry that bill when eventually signed by Mr. President will reposition the Commission by giving it the needed impetus to perform optimally with the removal of financial, legal and regulatory encumbrances that hitherto made it a toothless bulldog that can only bark but not bite.

In order to expedite action for the bill to see the light of the day, it imperative on other critical stakeholders like the National Economic Council, the Nigeria Governors’ Forum, ALGON, the Media and civil society to bring their influence to bear on the Presidency to do the needful.

It is strongly believed by concerned stakeholders that the signing of the bill into law by Mr. President will translate to stoppage of leakages in revenue generation, increase more revenues into the Federation Account and generally promote transparency and accountability in the management of Nigeria’s Commonwealth in consonance with President Bola Ahmed Tinubu’s Renewed Hope mantra. A stitch in time saves nine.

Oluwaseun,Public Affairs Analyst