RMAFC Act 2025: A transformative shift

By Nathaniel Adojutelegan

THE enactment of the Revenue Mobilisation, Allocation and Fiscal Commission Act, 2025 (“the 2025 Act”) marks a transformative shift in Nigeria’s fiscal governance framework. By repealing the Revenue Mobilisation, Allocation and Fiscal Commission Act, 2004 (“the 2004 Act”), the 2025 Act introduces crucial reforms aimed at enhancing the operational autonomy, enforcement capacity, and financial sustainability of the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC). This paper critically examines the key provisions of the 2025 Act and discusses the potential impact on revenue-generating agencies in Nigeria. The Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) is a constitutionally established body. The 2004 Act had long been criticised for limiting the Commission’s effectiveness. The 2025 Act, signed into law on 2 April 2025, repeals and replaces the 2004 Act, offering a reformed legal framework that strengthens the Commission’s constitutional mandate. This article explores the key provisions of the 2025 Act and analyses their practical and institutional implications.

Institutional and financial autonomy: First-Line charge funding: One of the most significant changes introduced by the 2025 Act is the shift in the Commission’s funding structure. Section 14 establishes that the RMAFC’s funds shall now constitute a first-line charge on the Consolidated Revenue Fund of the Federation. This contrasts sharply with the 2004 Act, which relied on periodic appropriations by the federal government, often leading to underfunding. By guaranteeing direct access to funding, the 2025 Act reinforces the Commission’s independence as stipulated in Section 7, which states that “the Commission shall be an independent and autonomous body.” This development is pivotal to ensuring operational stability and the depoliticisation of the Commission’s work.

Expansion of funding sources: The 2025 Act deals with the funds of the commission and how it should be maintained. Section 14(2) provides: “The Commission shall also establish and maintain a Fund into which shall be paid: all sums of money accruing to the Commission by Way of grants-in-aid, gifts, endowments and contributions from any donor agency; such money as may be granted to the Commission by the Federal, State or Local Government for the effective performance of its functions under this Act; and all other money- that may accrue to the Commission including the disposal, lease :hire of or any other activities. such as sęminars, workshops or any dealing with any property vested in or acquired by the Commission. Section 14(2) of the Act broadens the scope of permissible funding sources. These include grants-in-aid, gifts, endowments, and donations from donor agencies, as well as income derived from the Commission’s own activities—such as seminars, property rentals, and workshops. This provision promotes financial self-reliance and diversifying funding streams.

Revenue allocation mandate: The 2025 Act revises the Commission’s role in determining revenue allocation formulas. Under Section 6(1)(b), the Commission is empowered to “review the revenue allocation formulae and principles in operation to ensure conformity with changing realities,” and provides that any revenue formula determined by the Commission which, upon enactment by the National Assembly, shall remain effective for a minimum of five years. This provision addresses the ambiguities of the 2004 Act, which merely empowered the Commission to “make recommendations and submit its finding by a report thereto to the government of the Federation or of the State, as the case may be, regarding the formula for the distribution of the Federation Accounts and the Local Government Account.” The new approach introduces a fixed duration for revenue allocation frameworks, providing predictability and policy continuity in fiscal management.

Enhanced investigative powers: Request for information: Section 6(1)(e) significantly enhances the Commission’s oversight capabilities by empowering it to demand and obtain information from not only government agencies but also private companies and individuals. The scope of permissible documentation has also been expanded to include “books” and “documents” in addition to information, data and returns. Crucially, these documents must relate to the “remittance of accruals into or disbursement of revenue from the Federation Account,” thereby clarifying the boundaries of oversight and ensuring targeted information requests. Monitoring receipts and returns: Section 6(1)(f) further augments the Commission’s functions by granting it the power to monitor any receipt or return arising from: Operations under any law, property held by the Federal Government, dividends or interest on government-held shares or loans. This provision ensures comprehensive tracking of public funds and state-owned investments, promoting transparency and accountability. Statutory membership in development commissions: In a bid to strengthen regional monitoring, Section 6(2)(a)(vi) designates the RMAFC as a statutory member of all regional development commissions established by an Act of the National Assembly. This allows the Commission to oversee disbursements made to such entities from the Federation Account and to assess their impact on regional development.

Budgetary accountability: The 2025 Act imposes strict accountability obligations on the Commission. Section 15(1) requires the submission of annual income and expenditure estimates to the National Assembly by 30 June. Section 16 mandates annual reporting to the President, inclusive of audited accounts and the auditor’s report, with copies also sent to the National Assembly. These measures enhance financial discipline and legislative oversight.

Tenure and removal of the secretary: Unlike the 2004 Act, the 2025 Act provides for a defined tenure for the Commission’s Secretary. Under Section 9(2)(g), the Secretary shall serve a term of four years, renewable once. Section 9(4) outlines grounds for removal, including misconduct, incapacity, tenure expiration, or voluntary resignation—ensuring administrative stability and due process.

Staffing and secondment reforms: The 2025 Act liberalises the Commission’s staffing policy. Section 11(1) permits the RMAFC to appoint staff directly or by secondment, without prior approval from federal or state governments. While the Act removes formal application procedures, practical intergovernmental cooperation will still be required. Moreover, Section 11(2) eliminates the requirement for presidential approval when appointing persons not in the public service, thereby reducing executive interference in recruitment processes.

Criminalisation of Fiscal Misconduct

A groundbreaking feature of the 2025 Act is the introduction of specific offences and penalties for fiscal violations. Under Section 17: It is an offence for any board member or officer of a revenue-generating agency to fail, delay, or divert remittances due to the Federation Account (Section 17(2)(a)). Penalties include a fine of not less than ₦1,000,000, a minimum of five years’ imprisonment, or both. The submission of false financial statements is also penalised (Section 17(2)(b)), with a similar fine and a minimum of one year’s imprisonment. Fraudulent appropriation or diversion of revenue attracts the repayment of 110% of the diverted amount and a minimum prison term of 10 years (Section 17(3)). These provisions establish a clear legal deterrent against revenue mismanagement and institutional corruption.

The Revenue Mobilisation, Allocation and Fiscal Commission Act, 2025 represents a pivotal advancement in Nigeria’s fiscal architecture. By reinforcing the Commission’s independence, widening its enforcement powers, and institutionalising accountability mechanisms, the Act addresses long-standing legal and operational deficiencies. It provides a framework that not only empowers the RMAFC to fulfil its constitutional mandate but also strengthens the broader fiscal system in Nigeria. This legislation will promote efficient revenue mobilization, equitable

•Adojutelegan, PhD, is the Federal Commissioner representing Ondo State in RMFAC.

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