States and local governments may receive 109.74 per cent more money from the federal government in 2024, or N14.04 trillion.
The Punch reported that the Federal Government’s revised 2024–2026 Medium-Term Fiscal Framework contains revenue projections.
Payments to state and local governments are expected to rise from N6.69 trillion in 2023 to N14.04 trillion in 2024, according to these projections.
It is anticipated that the amount of revenue available in the Federation Account will rise from N11.86tn in 2023 to N26.61tn in 2024, a rise of 124.43 percent. Increased oil production forecasts, the elimination of subsidies, and exchange rate effects are all expected to contribute to this anticipated increase in revenue.
January through September of 2023 saw N7.48 trillion in revenue available in the federation account. States and local governments have gotten N2.00 trillion and N1.54 trillion of this, respectively.
“We are currently reviewing our tax and fiscal policies,” President Bola Tinubu said in reference to revenue during his presentation of the 2024 budget to a joint session of the National Assembly. “Our objective is to raise the revenue to GDP ratio during this administration from less than 10 percent to 18 percent. The government will work to stop financial leaks even more by putting important public financial management reforms into practice.”
The Minister of Finance and Budget Planning, Abubakar Bagudu, noted that revenue generation continues to be the main fiscal barrier to the country’s fiscal viability while outlining the breakdown of the 2024 budget.
Additionally, he said that in an effort to increase revenue generation, the government was reviewing its current fiscal and tax policies.
At a recent Federal Account Allocation Committee meeting in Delta, the Minister of Finance, Mr. Wale Edun, made the observation that state allocations have improved from an average of N650 billion per month prior to subsidies to over N1 trillion per month after subsidies. Mr. Edun was represented by the ministry’s Permanent Secretary, Mr. Okokon Udo.
“The administration’s economic reforms since taking office in May 2023 have outlined the proper steps to transformation of the country’s economy,” he declared.
“We have seen the introduction of significant reforms in less than six months of the administration, including the removal of fuel subsidies and changes to the fiscal and monetary policies intended to do away with multiple taxation, among other things.
“Since the subsidy was removed, revenue into the Federation Account in particular has increased, rising from an average of N650 billion per month to over N1 trillion over the last four months.”
He stated that the federal government was prepared to increase tax revenue, encourage budgetary balance, and practice prudent spending management.
The anticipated increase in federal funding to state and local governments, which is primarily dependent on these monies, is anticipated to quicken the rate of development in the subnational.
