Engr. Elias N. Mbam, FNSE, Chairman, RMAFC

Reasons states sit on gold but abandon it for Federal allocations —RMAFC

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Nigeria’s Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) has been headlines in the news recently for ostensibly saying it will increase the remuneration of the nation’s political office holders and judicial officers respectively. In this interaction, Engr. Elias N. Mbam, FNSE, Chairman of the Commission, submits that considerable stakeholders will determine whether such remunerations will be slashed or increased after a thorough review is done. The Ebonyi State-born RMAFC Chief also speaks on revenue allocations, why states with gold in their backyards yet look for silver somewhere else in terms of seeking monthly allocations, the need for them to exploit opportunities they have at home, and join the diversification train of the Federal Government. Excerpts:

Could you give an update on Nigeria’s new revenue formula?

In my first tenure, we commenced the process for the review of the revenue allocation formula in line with relevant laws. We progressed to the point that the Commission arrived at a formula that it felt was appropriate for the three tiers of government and in line with provisions of the relevant laws, that we would make a presentation of our advice to the President for onward transmission to the National Assembly.

RMAFC finished its own part but that was the point that I left. It was inconclusive but it wasn’t rejected and when I came this time around I said well this inconclusiveness, we have to conclude it but if you look at what obtained in 2014 and now, a lot has changed: security consideration is not the same, environmental challenges are not the same.

There are so many issues, which need to be considered in addition to what it was. As such we felt that we needed to constitute another committee that would look at all the variables, all the issues that were taken into consideration in the review and let us bring up a new advice to the President, and that is exactly what we have done.

Last year, I inaugurated a new committee to review the revenue allocation formula, it is a timely wish of most Nigerians and it is one of our primary responsibilities. The committee has been constituted and has commenced work. In this process, so many things may not be seen until they get to an advanced level.

The preliminary works they are doing now may not be noticed from outside because they have to do some studies on fiscal matters and areas that will be considered in arriving at the appropriate revenue sharing formula. Apart from this study, they need to do a literature review including what we did in 2014.

I had answered that question on why was it inconclusive. These were part of what they would do in the preliminaries. It is after these preliminaries that they will come out with invitation for memorandum and progress to the point where they will require the inputs of relevant stakeholders.

President Muhammadu Buhari (r) swearing-in Engr. Elias N. Mbam, as the Chairman, RMAFC, alongside 29 others as Commissioners at the Presidential Villa, Abuja, FCT, June 27, 2019.

The Federal Government’s input, state government’s input, National Assembly’s input, the Judiciary, local governments and civil societies, among others. We can then hold a public hearing on it.

So, this is the situation now it may be difficult to give a time frame because so many variables are not within your control. There are so many variables that will determine the time that is not within our control but we will do our best to get it done within a reasonable time.

What exactly do you mean by input in this regard?

The first one is that we will place an advert inviting people, we will write to institutions, we will write the Executive through the Secretary to the Government of the Federation (SGF), the National Assembly through the Clerk, we will write the head of the Judiciary, we will write ALGON, Governors Forum, write to local governments and state governments to make inputs as institutions because they are also bearing the brunt.

I have seen some complaints from some governors about their problems of paying some salaries and allowances. This is the time for everybody to make inputs and after that; there will be public hearing where we will all have an opportunity to make inputs.

Every Nigerian is free to make input. So, it is going to be an open process and I can assure you that whatever inputs people make will be considered. The only prayer is nobody should expect that his own suggestions must be the one to prevail because it is the input of majority of Nigerians that will prevail.

Your past efforts at fashioning a new revenue formula, why it was rejected, and is there any time frame for Nigerians to expect a new revenue formula will be out soon?

I am not in the position to know exactly why. I think those that were supposed to take the next step will be in the position to give you a reason. Unfortunately, they are not in government now. It is part of our consideration, the timing of the review. That is why it started immediately after the inauguration of the 9th National Assembly.

Now, we still have three-and-a-half years. If we cannot finish this early enough for them to consider within the three years, then something must have been difficult or unusual. We expect that we will be able to finish in time and will be concluded by this present National Assembly.

RMAFC has long advocated that states increase their internally generated revenue (IGR) and depend less on Federation Account. How far has this worked?

It hasn’t worked as well as we expected, but if you go to the states, ask for their internal revenue generation (IGR) as of 2012 and what it is today. We have started receiving money from solid minerals into the Federation Account, it wasn’t there. So, many states are holding advocacies and enlightenment on how to make the environment better for solid minerals sector to progress.

Lagos State Governor Babajide Sanwo-Olu (l) welcoming Engr. Elias N. Mbam, FNSE, to Lagos during the latter’s visit.

You know the quantity of rice that is being produced now. Was it the same? There are other areas of diversification, too. The awareness is there, we are making progress but we are not yet there and we hope that with all of us, including you in the print media, are in the vanguard to assist us to drive this thing home.

We should be able to let the states know that they have gold in their backyards, and they are looking for silver somewhere else. There is no state in this country that doesn’t have one form of mineral resource or the other; there is no state that doesn’t have enough arable land.

I remember when we were young; they used to collect bicycle tax. If you look at the exclusive list and the concurrent list, the tax area where local government can collect, there are so many areas they don’t collect their taxes. And because they come here (Abuja) every month to collect money, some of them are not exploiting the opportunities they have at home.

I’m happy that several states have started to key into this area and they are making impact. Go and check for the record just for your record, you will see some states have doubled their internal revenue generation between that time and now. So, we are making progress but we want to appeal to everybody to come into this and help us to let our people know the need to diversify.

Oil will finish one day. In fact, if we develop the solid minerals sector properly, I can assure you it is going to contribute more than what the oil and gas are contributing now; and it is more sustainable.

In agriculture, we are blessed with vast arable land. Why can’t we make the best use of it? We should go and learn what other people did, and diversify and the government is more committed than ever in this process, we are not there but we are making progress.

There have been controversies over remittances by the NNPC into the Federation Account. Has the Corporation been complying with appropriate remittances into the Federation Account?

When you use the word appropriate I become weak because I don’t know what is appropriate but I am aware that FAAC has a standing committee called postmortem where all collecting agencies, all issues about remittance from FAAC deliberations are digested and all the agencies come into that subcommittee meeting to present their papers and I am aware they have sometimes established shortfalls in some of the agencies, and when it is established the agency will refund.

So if you want to get details of that, you need to go to FAAC’s file. I don’t have the details, but I am aware that this is a routine thing that goes on every time and it has been happening.

There have been agitations over the planned review of the remuneration of public office holders by the Commission. Why do you think that is necessary now, and do you think it will happen? Do you have the backing of the President because he canvassed for downward review of the remuneration of public office holders as a result of dwindling financial resources?

First and foremost, we are established by law.  The law in this case is the constitution, which clearly spells out our responsibility and those responsibilities are very clear. One of them is to determine the remuneration appropriate for public and judicial office holders. So it is our job.

We can’t go to get permission to do our job and in that respect you will believe with me, including yourself all of you here have made one comment or the other about the salaries of public office holders.

People are really anxious that it should be reviewed, and it is part of our responsibility and President charged us on the day he inaugurated us to do everything to increase the size of the cake, block leakages and reduce the cost of governance. So, we are following the law establishing us and I don’t want to be pessimistic.

I want you to make contribution to ensure that it succeeds. We are the ones that will determine it particularly you. You know the press determines how things flow, the press has a great role to play in supporting us, in molding opinions of Nigerians but I can tell you the much I know and read: an average Nigerian wants it reviewed but what they have been asking me and I don’t want to say or to give an answer before we arrive is: is it going to be up or down?

In fact, some even reported it has been a recurrent issue that I said it would be up. Some attacked me, some took their time to read details of what I said, but the paper wanted to attract attention but they were careful they didn’t say I said it will go up but it might be up. What I have always said is that this is a process and at the end of the process, we will determine what it will be so; don’t ask me whether it will be down or up. I won’t say but let the process flow and in the end the result will come out.

How do you assess the policy of monetisation introduced by the Revenue Mobilisation, Allocation and Fiscal Commission?

Now let’s not preempt what will come out. I said that we intend to invite memoranda to give inputs. Those inputs include what should happen to the current practices: should they be continued? What aspect of it should be removed? These are inputs that will come from you and others because it is not my own decision. It is the law and what Nigerians want that will come to pass.

However, the question will be: what was the intention of having that policy in place? If you now establish the intention, how far has it satisfied the intention? If it is the intention of reducing the expenditure of public office holders, one will say if you look at the cost, it has reduced.

The thing is if there is any abuse that is a different thing because if you read the monetisation law, you will find that part of what was intended is to reduce cost because one public officer used to have over 20 official vehicles.

I was one of those that lost in that I didn’t benefit from the old system. When I came to Abuja as a minister, I thought my day was made at least for vehicles. I came here without a vehicle but I was allocated no vehicle. So, I had to go back to the village to pick my old vehicle to start working here. I used my private vehicle.

So ideally, you should drive your private vehicle to the office. Then, for official duties you should use the government vehicle, and at the end of the day it will drive you home while the driver will return the official vehicle to the office.

Then about maintenance of government quarters, if you look at the record of how much Ministers budget and spend as maintenance of their residences, that doesn’t hold now. So, let us look at what is the aim and objective and how each of these objectives is being realized. You will find out that some were met, some were not, and some were abused.

Does every state in Nigeria now have a representative in the Commission?

No! We have 29 states represented now. So, we are still expecting eight. The President appoints them subject to the confirmation of the Senate. (Nigerian Tribune)

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