Plateau State Governor, Caleb Mutfwang, has pointed out that despite an increase in the monthly Federal Allocations to State Governments, the real value and purchasing power of these funds have significantly decreased due to inflation and the weakening of the naira.
In an interview on Tuesday, Governor Mutfwang explained, “It is true that in terms of amount, it has actually increased but in terms of purchasing power, in terms of real value, it has decreased very significantly.”
President Bola Tinubu, during a broadcast on Sunday addressing the #EndBadGovernance nationwide protests, mentioned that some of his reforms, including the removal of the petrol subsidy and the floating of the naira, have resulted in State and Local Governments receiving the highest allocations ever from the Federation Account.
When asked about the exact monthly allocation to Plateau State, Governor Mutfwang, a chieftain of the Peoples Democratic Party (PDP), stated that he couldn’t provide a specific figure due to the fluctuations in the monthly disbursements.
He emphasized that the costs of essential materials such as diesel, cement, and iron rods for constructing critical infrastructure have risen sharply.
“So, we shouldn’t just look at the amount, let’s look at the purchasing power of the amount that the state has so far received from the federation account,” Mutfwang added.
He further noted, “It doesn’t need any rocket science. When the last administration came in 2015, the dollar exchanged for about N180 to the naira. Today, you are telling me that money has increased but all of us know the value of the naira to the dollar. And we are still a consumer nation; many of the things we are using in governance are imported and so they are dollar-denominated.”
Currently, the Federal Government receives 52.68% of the country’s monthly revenue, states receive 26.72%, and local governments receive 20.60%, as allocated by the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), which operates under the Presidency and is disbursed by the Federation Account Allocation Committee (FAAC).
