Plateau State Governor Caleb Muftwang has argued that despite an increase in monthly federal allocations to state governments, the purchasing power and real value of the funds have “decreased significantly” due to inflation and the weakened naira.
Governor Muftwang’s remarks came in response to President Bola Tinubu’s Sunday broadcast, where Tinubu claimed that money saved from the removal of the fuel subsidy was used to augment state allocations to alleviate current hardships.
In an interview on Channels Television’s Sunrise Daily, Muftwang said, “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.”
When asked about the monthly allocation to Plateau State, Muftwang admitted he “can’t give an exact figure” due to fluctuations in the amounts received.
He emphasized that the cost of diesel, cement, iron rods, and other construction materials had surged, affecting infrastructure projects.
“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,” Muftwang said. He added, “It doesn’t need any rocket science. When the last administration came in 2015, the dollar exchanged to 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.”
Muftwang pointed out that Nigeria remains a consumer nation, with many governance essentials being imported and thus dollar-denominated.
Currently, the federal government receives 52.68% of the country’s monthly revenue, states get 26.72%, and local governments receive 20.60%.
These allocations are managed by the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) and disbursed by the Federation Account Allocation Committee (FAAC).
Nationwide protesters have persistently demanded the reinstatement of the fuel subsidy, blaming its removal for the sharp rise in inflation, which now stands at over 34%, with food inflation exceeding 40%.
