On Monday August 24th, the Federal Government raised the alarm, over low level of Internally Generated Revenue (IGR), by state governments. In this warning, the Federal Government declared Katsina, Kebbi, Borno, Bayelsa and Taraba states, as insolvent, after the collection of IGR turned out “extremely poor”.
Mr. Elias Mbam, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) Chairman, noted that the Federation Account was currently over stressed, due to unending demands of the three tiers of government, which urged states to evolve creative ways of increasing their IGR. This will then lessen the strain on the federal purse.
Receiving the Annual States Viability Index (ASVI) from the Editor-in-Chief of the Economic Confidential, Mr. Yushau A. Shuaib in his office in Abuja, Mbam restated the need for the various tiers of government to endeavour to develop alternative sources of revenue in view of the Federal Government’s declining incomes.
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According to the index, Rivers, Kaduna, Enugu, Kwara and Zamfara posted impressive IGR in 2019.
Mbam said: “the annual ASVI report apart from providing a good source of information to the general public also has been identified as a source of information that would drive RMAFC on its mandate to encourage states of the federation to improve their Internally Generated Revenue.
“I have come to realise that Economic Confidential has become a household name and its reports that are factual and authoritative should be useful, especially in guiding states whose revenues keep dwindling so that they can improve.”
Mr. Shuaib spoke on the report, saying the ASVI assessed and ranked states by their annual IGR, in comparison to their receipts from the Federation Accounts allocation.
In addition to this he said: “without the monthly disbursement from the Federation Account, many states cannot survive as the indices showed that seven states are insolvent due to very poor IGR that were far below 10 per cent of their receipts from the Federation Account”.
According to Mr. Shuaib, apart from Lagos and Ogun states, which ranked highly in the revenue generation in 2019, more states have recorded an impressive IGR in 2019. compared to 2018.
