One Federation, One Fiscal standard
Returning to an old policy memorandum can be a delicate exercise. One may discover that the problems have remained exactly where they were left, only older, larger and now supported by additional committees. Occasionally, however, one finds that government has acted on some of the recommendations. That is the more encouraging discovery, and it deserves […]
The journey of fiscal reform in Nigeria has shown progress, albeit with certain challenges. The Revenue Mobilisation Allocation and Fiscal Commission Act 2025 has been a significant step forward, empowering RMAFC with stronger enforcement capacity, broader monitoring capabilities, and greater influence over fiscal policy. However, the reform journey is far from complete.
Nigeria currently has a federal institution responsible for revenue monitoring but limited enforcement reach, coupled with a statutory institution focused on enforcing fiscal responsibility within the federal sphere. These two institutions, while complementary, do not form a cohesive system that connects revenue mobilisation, allocation, expenditure responsibility, public borrowing, fiscal risk, and accountability across all three tiers of government.
A key issue lies in the lack of a unified fiscal responsibility framework. While RMAFC oversees the Federation Account and ensures its proper functioning, it does not typically oversee state budgets, internally generated revenue, personnel expenditure, and procurement. Conversely, the Fiscal Responsibility Commission has a narrower jurisdiction that mainly concerns the federal government.
This discrepancy creates an uneven landscape where fiscal risk can potentially affect the entire economy, yet the mechanisms to address it remain fragmented. One potential solution is to integrate the federal FRC into RMAFC, thereby creating a more cohesive and centralized fiscal oversight body. The National Assembly could amend or replace the Fiscal Responsibility Act, transferring the existing federal FRC's functions to a new Fiscal Responsibility and Revenue Assurance Directorate within RMAFC.
This move would strengthen Nigeria's fiscal governance structure, ensuring a more comprehensive and coordinated approach to fiscal management across the nation.
Written by urgent.news from Daily Trust's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
