Lagos advocates 1% of FG income on “special economic status”


Lagos State Finance Commissioner Dr Rabiu Olowo on Tuesday asked for one percent of the revenues accruing to the federation’s account for its recognition of “special economic status”.

Olowo launched the appeal as a two-day public hearing on the Southwest Zone on the review of the income allocation formula by the Income Mobilization Allocation and Taxation Commission (RMAFC) , which entered the second day on Tuesday on Victoria Island, Lagos.

The Nigeria News Agency (NAN) reports that participants from the six southwestern states attended the event.

The commissioner said the federal allocation to the state should reflect the needs of the state; adding that recognition of Lagos State’s “special economic status”, muted 45 years ago, was long overdue.

“Let me reiterate that the Lagos State government, through the LSSTF, has spent over 4 billion naira on the Nigerian police (including maritime police and navy) in one year (audited accounts published by LSSTF).

“More than 200 billion in the provision of education and health care services to the population in one year and more than 200 billion in infrastructure (including rail and river transport systems).

“Lagos State is innovating to make life easier for all Nigerians.

“As we continue to increase the welfare spending of our growing population, the federal allocation to Lagos State based on hospital beds, school enrollment, etc. continues to decline every year.” , did he declare.

Olowo added: “It goes against the spirit of true federalism and the vision of our founding fathers.

“Indeed, the federal government had already promised a special status to the State of Lagos in a national program of February 3, 1976. Today, we urgently need this right.

“And we the people of Lagos are asking for 1 percent of the income accrued to the federation account as a ‘special economic status’ allowance to the state.

“Once again, we all have a collective responsibility to ensure that the true aspirations of our people are reflected in the new income allocation formula so that posterity will judge us when the long-term consequences manifest”, did he declare.

Olowo argued that all stakeholders in the public hearing had taken the same position on the need to revisit the income allocation formula that had been in place for 31 years to reflect current circumstances.

“Yesterday, virtually all stakeholders agreed that the existing income allocation formula, inherited from the military in 1992, does not correspond to social and economic reality.

“As we continue this historic process, let us keep in mind that the impact of today’s decision will remain with us for many years to come.

“In any democratic environment, it is imperative to consciously and periodically review the mechanism for allocating resources to ensure a fair, just and equitable distribution of the ‘Commonwealth’ between levels of government.

“Unfortunately, it had not been executed for over 29 years,” he lamented.
Olowo added.

“Therefore, all hands need to be on the bridge to ensure that ‘life improvement’ indices take priority over highly subjective criteria.

“Even more, there is a collective responsibility to ensure that the new income allocation formula reflects the realities on the ground.

“Today, all state and local governments make a substantial contribution to general well-being, including internal security, at a level well beyond what is envisioned in the 1999 Constitution.

“For example, all of the Lagos State Government’s MDAs as well as major facilities in several sectors are outside the national electricity grid and are currently served by Lagos State Independent Power, which provides a very constant electricity supply,” he said. he declared.

Likewise, Lagos State Chief Justice Judge Kazeem Alogba expressed full support for the revised revenue distribution.

Alogba, who was represented by Mr. Adenike Shonubi, Deputy Chief Registrar, Legal Unit, Lagos, proposed that state governments receive 45 percent, 30 percent for the federal government and 25 percent for local government.

The Chief Justice said that the rationale for the proposed review was that states had greater responsibilities in terms of items under concurrent and residual lists (Second Schedule, Part 11 of the amended 1999 Constitution).

“In addition, state governments are also responsible for the formation and execution of policies as well as the provision of infrastructure that has an impact on the socio-economic development of the population of the state.

“State and local governments are also closer to the people and are more aware of their needs.

“Therefore, there is a need for more funding to carry out all these functions,” he said.

In his recommendation, Alogba said that each state should be granted a greater percentage of value added tax (VAT) from its region.

He said that “We also recommend a percentage of 75 percent to each state while 25 percent should go to the federal government.” (NAA)

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