ABUJA, Nigeria (VOICE OF NAIJA)-The Revenue Mobilisation Allocation and Fiscal Commission has disclosed that the ongoing review of Nigeria’s revenue allocation formula is at an advanced stage, as it begins a nationwide data verification exercise to update the indices used in distributing revenue across the federation.
The development was announced in a statement issued on Thursday by the Head of Information and Public Relations Unit of the commission, Maryam Yusuf.
The Chairman of the commission, Mohammed Shehu, was quoted as saying, “The Commission is committed to ensuring that Nigeria’s revenue allocation framework reflects the realities on the ground. Accurate data is the backbone of fairness, equity, and national cohesion.
READ ALSO:Enugu Receives N230bn FAAC Allocation
This nationwide exercise represents our determination to build a more transparent and responsive revenue distribution system that serves the interests of all Nigerians.”
He explained that the exercise is designed to reassess the factors and proxies used in sharing revenue among states and local governments, with the aim of aligning allocations with current socio-economic realities.
According to him, reliable and verified data remains the foundation of a fair and sustainable revenue allocation system, noting that the verification process will strengthen fiscal federalism and enhance national development planning.
The statement added, “He (Shehu) further disclosed that the current review of the national revenue allocation formula has reached an advanced stage, making the data verification exercise a critical step in safeguarding the integrity and reliability of the indices that will underpin future allocations.”
Shehu also noted that the exercise will have far-reaching implications for fiscal management and balanced regional development, urging state governments, local authorities, traditional institutions, civil society organisations, and community leaders to cooperate fully with the commission’s teams.
The commission explained that the nationwide verification exercise will be conducted across all states and the Federal Capital Territory through a phased, region-by-region rollout, involving the collection, validation, and reconciliation of key socio-economic and infrastructural data.
It stated that the exercise will focus on critical indicators such as education and healthcare provision, internally generated revenue capacity, and infrastructure development across states and local government areas.
The commission added that stakeholder engagement sessions will be organised in each state to promote transparency, build trust, and ensure collaboration among government agencies and local communities.
Shehu said Nigeria’s revenue allocation framework is based on indices such as population, landmass, infrastructure, and other socio-economic indicators, stressing that these must be reviewed periodically to reflect changing conditions.
“Over time, Nigeria has witnessed significant socio-economic transformations marked by population growth, expansion of infrastructure, urbanisation, and widening development gaps among regions. These evolving realities necessitate the validation of existing datasets to ensure fairness, transparency, and equity in revenue sharing,” he said.
He emphasised that the data verification process is crucial to preserving the integrity of the indices that will guide future allocations.
According to him, the commission’s teams will engage extensively with Ministries, Departments and Agencies, as well as local government authorities and community stakeholders nationwide, to ensure that all data accurately reflects current realities.
The commission maintained that the exercise is both a statutory responsibility and a strategic initiative aimed at strengthening institutional credibility and supporting evidence-based policymaking.
In August 2025, the commission commenced a fresh review of Nigeria’s revenue allocation formula among the federal, state, and local governments, more than three decades after the last adjustment.
Currently, revenue is shared at 52.6 per cent for the Federal Government, 26.7 per cent for states, and 20.6 per cent for local governments, while one per cent each is allocated to the Federal Capital Territory, ecological fund, natural resources, and stabilisation fund.
About four years ago, the commission presented a report on the review of the vertical revenue allocation formula to former President Muhammadu Buhari.
In the 2022 report presented by the then Chairman of the commission, Elias Mbam, a proposed formula recommended 45.17 per cent for the Federal Government, 29.79 per cent for states, and 21.04 per cent for local governments.
However, previous efforts by the commission to revise and implement a new revenue allocation formula have yet to produce the desired outcome.