By Wale Sokunbi (08056180228
walesokunbi2003@yahoo.co.uk) Wednesday February 29, 2012 Once again, there is raging controversy
on the formula for sharing of national
revenue. This age-long controversy that
had been rested for some years following
the allocation of 13% derivation to oil
producing states in 1999, is firmly back on the front burner of public discourse.
And, we have none other than the
Governor of the Central Bank, Sanusi
Lamido Sanusi, to thank for it. Sanusi, in a recent interview with
Financial Times of London, kicked off the
argument that Boko Haram, poverty and
the general unrest in the Northern part
of the country is a result of the lower
sums they get from the Federation Account compared with the oil producing
states. According to him, “there is clearly
a direct link between the very uneven
nature of distribution of resources and
the rising level of violence.” The Northern Governors Forum chaired
by Niger State Governor, Babangida
Aliyu, took the argument up from there
last week when it unequivocally
demanded more funds for the Northern
States. Aliyu, speaking for governors of the
Northern States, last Thursday, called for
a review of the revenue sharing formula
to “reflect current realities.”
The North, apparently, is beginning to
see the extra funds allocated to oil producing states under the 13 per cent
derivation allocation as an injustice that
ought to be redressed, and a direct
cause of the Boko Haram onslaught.
Governors in the region believe sharing of
oil receipts on the basis of equality of all states will make more money available to
non-oil producing states, especially those
in the Northern part of the country. The South South is unimpressed with
this position. Governors in the region
have rejected this clamour for more
funds by Northern States, outright.
State governors in the South have lined
up arguments against the position of the Northern governors. Rivers State says
every state has resources such as
agriculture which proceeds are not
shared among states. Abia hinges its
argument on the fact that it is the oil
producing states that bear the brunt of oil production through environmental
degradation, while Ondo State says 13
per cent derivation is the oil producing
states’ statutory right. Akwa Ibom agrees with Rivers that oil
producing states are the goose that lays
the Nigerian golden egg, hence there is
no basis for equal sharing of oil revenue
with non-oil producing states, because
the producing region does not share degradation of its environment with
them.
One clear message that runs through the
responses from the South South state
governments is that the Northern States
that contribute nothing to oil revenue generation should not be talking about
injustice in the sharing of revenue that
accrues therefrom. Many hinged their argument on the fact
that the oil actually belongs to the oil
producing areas, which should be
commended for accepting only 13 per
cent derivation approved for them only in
1999, when the revenue sharing formula in the country before the intervention of
the military in governance in 1966, was
50 per cent to the region that generates
it, and 50 per cent to the Federal
Government.
The arguments, both for and against allocation of more revenue to the
Northern and other non-producing areas
of the country, are compelling. On face value, on one hand, it is very
easy to regard Sanusi and the Northern
governors who want a greater share of
the revenue from oil for the North, as
greedy and insensitive. It may be okay to
ask some questions. Why, for instance, should a section of a country which
contributes little or nothing to national
revenue be demanding for more funds
from the centre? Why can’t states in
such areas generate more revenue
internally, instead of sitting, hands down, waiting for financial handouts from
Abuja? Why can’t they harness the
potentials of their areas, be it agriculture,
solid minerals or industry, and earn
enough to support their population? On the other hand, it may be easy to
query, also, the seeming injustice of one
single state, such as Rivers, receiving
N1.053 trillion (a billion in a thousand
places) between 1999 and 2008 from
the Federation Account while two states in the North-East, Yobe and Borno,
received N388 billion only, within the
same period. Well meaning people may
ask if this is not a great injustice that
needs to be urgently redressed,
especially in a country that claims to be united. The two arguments above may, indeed,
be valid, but they do not go to the heart
of Nigeria’s problem on revenue allocation
and utilization.
The nation’s major problem with revenue
allocation formula is not so much the amount that goes to the individual
states, as the disproportionate huge
chunk that goes to the Federal
Government, and the way it is utilized.
Under the present formula, the Federal
Government gets 52.68 per cent (more than a half) of all national revenue. The
36 states share N26.32 per cent (a little
over a quarter), while local councils that
are notorious for not doing much to
improve the fortunes of their areas, get
20.6 per cent. Oil producing states began getting 13
percent derivation in 1999 to redress the
neglect of the region by succeeding
governments over the years.
This distribution formula is unduly
lopsided in favour of the Federal Government, while the states, which
bear the greater brunt of responsibility
for the people, take only a quarter, and
mostly indolent local governments take a
whole 20% of national revenue! This sharing formula is inexpedient to the
quest for even development of the
country. This is even more so as much of
the funds are not committed to projects
that have direct bearing on the welfare
of the people. It is also likely partly responsible for the jumbo pay of political
office holders at the national level.
Again, the linking of Boko Haram attacks
to poverty occasioned by a revenue
allocation formula that is skewed against
the North, is tendentious. For one, Boko Haram operatives have at no time left
anyone in doubt of their agenda – which
is to institute Sharia and Islamic rule,
initially in some states in North, but, as it
would seem now, throughout the
country. At no time has the sect said anything
about poverty. Where then did Sanusi
get his poverty + Northern Nigeria =
Boko Haram theory? Moreover, a number
of persons identified to be involved in
the Boko Haram terror campaign are not poor. President Jonathan, himself, has
said they can be found in the military,
the police, judiciary, legislature and,
indeed, every area of government. Is it
poverty that pushed such ones into
sympathy for the sect? That is certainly not so! The Christmas Day underwear bomber,
AbudulMuttalab, who was recently jailed
in the United States for attempting to
detonate an explosive device on an
American airliner, is the son of a notable,
well-educated and rich Nigeria. Is it poverty that drove him to the terrorist
adventure?
While many states in the country can
very well do with increased revenue,
increased funding from the Federal purse
is not the solution to the Boko Haram problem, unless the campaign of the sect
is just another pressure tool in the hands
of Northern leaders. Let all state governments seek ways to
increase Internally Generated Revenue
(IGR). Let them stop being appendages
of the government. Let a higher
percentage of federal revenue go the
states. Let there be greater accountability from local governments for
the 20 per cent of national funds that
they collect. Also, let the huge financial
gulf between oil producing states and
their non-oil producing counterparts be
redressed. But then, we should not turn poverty and Boko Haram hinto bedfellows. Poverty is a global, social phenomenon
that is as serious in the North as it is in
some of the states in the oil producing
part of the country. The Boko Haram
onslaught is the result of skewed
thinking and reasoning fired by misguided religious fervor. More money to the
states may help address the peculiar
Nigerian poverty debacle. It will not
resolve the Boko Haram call
www.sunnewsonline.com/webpages/opinion/2012/feb/29/opinion-29-02-2012-001.html