By: Maureen Ikpeama
A three-day retreat of the Federation Account Allocation Committee (FAAC) Post-Mortem Sub-Committee has ended in Enugu with a strong call for sweeping reforms to curb revenue leakages and enhance transparency in the management of the Federation Account.
The retreat, held at the International Conference Centre, Enugu, brought together key stakeholders from federal and state revenue-generating agencies, oversight institutions, and fiscal policy experts. Themed “Assessing Fiscal and Sectoral Policies for Revenue Leakages in the Federation Account,” the high-level gathering concluded with a nine-point communiqué outlining practical steps to strengthen fiscal discipline and accountability.
In the communiqué read on Wednesday in Enugu, participants resolved that all Federation revenues must be remitted in full into the Federation Account before any deductions are made, in strict compliance with constitutional provisions. They described the move as fundamental to restoring transparency and accountability in the management of public funds.
The participants recommended the establishment of a unified, real-time revenue data architecture accessible to FAAC members.
According to the communiqué, such a system should be supported by periodic independent reconciliations involving the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), the Central Bank of Nigeria (CBN), and other relevant agencies to ensure accuracy and integrity of revenue figures.
To address inefficiencies in revenue collection, participants urged that arrangements be tied to measurable efficiency and performance benchmarks. They further proposed strict caps on both operational and capital expenditures by revenue-generating agencies to prevent excessive deductions from Federation revenues.
On crude oil-backed borrowing, the committee called for legislative approval, full disclosure, and independent audits of all such arrangements. Existing agreements, they said, should be reviewed to ensure alignment with the Petroleum Industry Act (PIA) and to safeguard the financial interests of the Federation.
The communiqué recommended intensified engagement between RMAFC and the Nigerian National Petroleum Company (NNPC) Limited to obtain full documentation on joint venture asset transfers, compute net revenues due to the Federation, and pursue recovery actions where necessary.
Participants also underscored the need to strengthen the independence and capacity of the Office of the Auditor-General for the Federation through guaranteed funding, stronger legal backing, and unrestricted access to relevant financial data.
In the area of tax administration, the retreat emphasised accelerated digitalisation, adoption of VAT e-invoicing, enhanced taxpayer education, and a systematic review of tax incentives to strike a balance between development objectives and revenue sustainability.
The Communique additionally called for the strict enforcement of FAAC operational rules, including clear accountability mechanisms, enforceable sanctions, and mandatory disclosure requirements to boost public trust and transparency.
Concluding, the retreat affirmed that revenue leakages in the Federation Account are neither inevitable nor irreversible. Participants maintained that with firm political will, institutional collaboration, constitutional compliance, and robust oversight, Nigeria can significantly strengthen its Federation revenues and improve fiscal resilience.
They reaffirmed their commitment to working collectively to safeguard the integrity of the Federation Account in the national interest.
