The Federation Account is over stressed, the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has warned.
The commission said the stress is as a result of the over-dependence of the three tiers of government on the account.
The chairman of the commission, Elias Mbam, disclosed this while receiving an Annual States Viability Index (ASVI) from the editor-in-chief of the Economic Confidential, Yushau Shuaib, in his office in Abuja.
Mr Elias urged state governments to develop strategies to boost their internal revenue.
“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 (IGR).
“I have come to realize 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.” he said.
Speaking on the report, Mr Shuaib said the ASVI report assessed and ranked states by their annual IGR in comparison to their receipts from the Federation Account Allocation.
He said the report has shown that, “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% of their receipts from the Federation Account”.
Mr Shuaib however said that, just like Lagos and Ogun states, more states have been recording impressive and improving IGR in 2019 as compared to 2018.
The states are Rivers, Kaduna, Enugu, Kwara and Zamfara State, who all increased their revenue by more than 10 percent in 2019 when compared to the previous year.
Some states were assessed to be insolvent according to the report based on their poor IGR performance. The states are Katsina, Kebbi, Borno, Bayelsa and Taraba states.