a. Principles that guide revenue allocation in Nigeria:

1. Equity: Revenue allocation should be fair and just, ensuring that resources are distributed according to the needs of different regions and populations.
2. Efficiency: The allocation of revenue should encourage economic efficiency, promoting growth and optimal use of resources without waste.
3. Transparency: The process of revenue allocation should be open and transparent, allowing citizens to understand how funds are distributed and used.
4. Stability: Revenue allocation should provide a stable source of funding for government operations and public services, minimizing fluctuations that could disrupt service delivery.
5. Accountability: Government bodies involved in revenue allocation must be accountable for their decisions, ensuring that funds are used appropriately and effectively.

b. Factors that led to controversies surrounding revenue sharing in Nigeria:

1. Ethnic and Regional Tensions: Nigeria’s diverse ethnic groups often have conflicting interests, leading to disputes over how resources are shared among different regions.
2. Disparities in Resource Endowment: Regions rich in natural resources, such as oil, often feel they do not receive a fair share of revenue compared to less endowed areas, causing resentment.
3. Political Interference: Political considerations can influence revenue allocation decisions, leading to accusations of favoritism and lack of adherence to established guidelines.
4. Lack of Clarity in Guidelines: Ambiguous revenue-sharing formulas and guidelines can lead to misunderstandings and disputes among different levels of government.
5. Corruption and Mismanagement: Instances of corruption and mismanagement within revenue allocation processes can exacerbate tensions and lead to public distrust in the system.