Senate Moves to Amend Constitution, Increase Federal Government’s Share of Revenue

The Nigerian Senate has initiated a process to amend the 1999 Constitution to increase the federal government’s share of national revenue. A bill sponsored by Senator Sunday Karimi (Kogi West) passed its first reading, proposing an upward review of the current formula which allocates 52.68% to the federal government, 26.72% to states, and 20.60% to local governments.

Karimi argued that the existing arrangement is “outdated and unsustainable,” leaving the federal government with insufficient funds to address mounting infrastructure decay, nationwide insecurity, and other national responsibilities. He cited the costs of maintaining federal roads and combating terrorism and banditry as primary justifications for the need for more central funds.

Key Points:

The proposed amendment would significantly alter Nigeria’s fiscal federalism, centralizing more financial power at the federal level.
It reflects the persistent strain on federal finances despite its majority share, highlighting issues of expenditure efficiency and revenue generation.
If passed, the change could reduce the financial autonomy of states and local governments, potentially impacting grassroots development and service delivery.
The rationale underscores the enormous financial burden of national security and infrastructure maintenance, which currently falls disproportionately on the federal purse.
The move is likely to spark intense debate between federal and sub-national authorities over resource control and the principles of fiscal decentralization.

This legislative effort marks the beginning of a contentious debate over Nigeria’s revenue architecture, balancing the federal government’s expansive duties against the financial needs and autonomy of state and local tiers.

Sources: Daily Post