Senate Moves to Increase FG’s Revenue Allocation

The Senate has commenced moves to amend the 1999 Constitution to increase the Federal Government’s share of revenue from the Federation Account, arguing that the current allocation formula no longer reflects the scope of responsibilities borne by the centre.

The proposed constitutional alteration was introduced at plenary on Tuesday, where lawmakers expressed concern that the existing revenue-sharing arrangement has become inadequate in the face of rising national obligations, particularly in the areas of security, infrastructure and governance. Under the current formula, revenue from the Federation Account is shared among the Federal Government, the 36 states and the 774 local government councils. Senators backing the amendment contend that while the Federal Government is responsible for funding national defence, internal security, foreign affairs, major infrastructure and other nationwide obligations, its revenue share has remained largely unchanged over the years. Leading the argument, proponents of the amendment said the imbalance has placed increasing financial pressure on the centre, limiting its capacity to effectively respond to security challenges, maintain federal roads and deliver critical national services. The move marks the beginning of what is expected to be a rigorous constitutional amendment process. The bill will undergo further legislative scrutiny, including debate at second reading, committee consideration and possible public hearings before a final decision is taken by the National Assembly. If passed by the Senate and the House of Representatives, the proposed amendment would also require approval by at least two-thirds of state houses of assembly to become law, in line with constitutional provisions. The development has already sparked renewed debate over fiscal federalism, with analysts predicting strong reactions from state governments concerned about the potential impact on their revenue allocations.