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By: Ifeanyi Izeze
It has become a routine ritual that every month, the Federation
AccountAllocation Committee (FAAC) must end with fighting over shortfalls
inremittance of accrued revenue into the central coffer. This year alone,
we have recordedseven deadlocks in FAAC meetings. It ended inconclusive in
February for Januaryallocation, March for February allocation, April for
March allocation, also on3th June for May allocation and two times in July
for June allocation
By the way, what is FAAC in the first instance? Isit not the forumwhere
money is shared as allocations among the Federal, States and
LocalGovernments? This meeting is chaired by the Minister of Finance and
Commissionersof finance from the 36 states of the federation and FCT every
month, as well asrepresentatives of revenue generating agencies.
How long can wecontinue like this? For somemonths now, it has been the
federating states as usual accusing the FederalGovernment and the Nigerian
National Petroleum Corporation (NNPC) of failing toremit tens of billions
of Naira of the monthly accrued revenue into theFederation Account.
Curiously, our usual reactions have always been to rush to berate theNNPC
and other revenue generating agencies of the federal government but
wefailed to see or rather honestly acknowledge that there is something
seriouslywrong with the way our federal system is structured. We should
ask ourselves:is this how federal system of government works in other
climes where it ispracticed such as the United States of America whose
model we claimed to havecopied?
It has become an indisputablefact that today’s Nigerian states essentially
have been reduced to parastatalsof the Federal Government and have become
dangerously addicted to the monthly“handouts” (allocation) they receive
from Abuja? This is a result of decades of dodging harddecisions on the
negatively skewed relationship between the federal on one handand the
state and local governments on the other.
How do you reconcile that the combined Internally Generated Revenue
(IGR)from all the 36 states came up to less than one percent of Nigeria’s
nominal GrossDomestic Product (GDP)? Internally generated revenue is far
less than what thestates require to run their administrations and many
state and localgovernments survive by consuming more resources than they
can generateinternally – thanks to the generous handouts from the
federation accounts andthe “spirit of fighting” that goes with it.
With these every-month quarrels over sharing of free money by
thethree-tiers of government, it should have dawned on us that we have
promoted, orrather tolerated a defective political economic structure.
We politicized the creation of states and local governments over theyears
and ended up having states and local governments that are too weak tomeet
their constitutional responsibilities to their people. Consequently
theFederal Government emasculated them and took away those
responsibilities thatshould actually be handled by the states and local
governments.
As aconsequence, the Federal Government appropriates, along with
theseresponsibilities, huge resources to itself and leaving little or
nothing to thelocal and state governments. For example, in the allocation
of revenue from theFederation Account, the Federal Government is unduly
favoured at the expense ofthe States and Local Governments. Out of every
Naira in the Federation Account,56 kobo will go to the Federal Government!
This is neither efficient norequitable.
If we accept thewisdom behind calls for a restructuring of the polity, we
must be ready tobuild a foundation for its success: we must, in other
words also restructure andstrengthen the economies of the sub-national
units (the states) by making moremoney available to them for grassroot
development.
Former VicePresident and presidential hopeful on the platform of the
Peoples DemocraticParty (PDP), Atiku Abubakar, in his recent speech at the
London’s RoyalInstitute of International Affairs (Chatham House),
frontally challenged thispresent arrangement and suggested some cogent
policy roadmaps that if taken,may redress some of the problems of our
negatively skewed federal system.
Though political opponents including the ruling party, APC, may take itas
subtle campaign for the PDP presidential ticket, there are some
takeawaysfrom the Atiku’s speech at the Chatham House London that deserve
to beseriously considered if we actually want to help the states
strengthen theireconomies and free them from the present cap-in-hand
situation.
Atiku on “TheImportance of Strengthening the Economic Management System of
the FederatingStates in Nigeria,” said “There is nothing as addictive as
states that are dependent on theirmonthly share of revenue from crude oil
sales and the only way to get them tomanage their economies in an
economically viable way is to cure them off thataddiction.”
The need to reverse the current sharing formula and allocate more moneyto
the local, states and federal governments in that order, cannot
beoveremphasized. This will make the centre less attractive and drive
developmentto the grassroot through the activities of local governments in
addition towhatever the state governments will also add to improve the
quality of thelives of the ordinary Nigerians. We must commit to a new
development agenda withfocus on wealth creation by the states, rather than
wealth distribution fromAbuja to state and local government headquarters.
God bless Nigeria!
(IFEANYI IZEZE: iizeze@yahoo.com;234-8033043009)