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Fashola : On True Fiscal Federalism We Stand! - Politics - Nairaland

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Fashola : On True Fiscal Federalism We Stand! by courage89(m): 6:31am On Jul 02, 2012
Although the Constitution of the Federal Republic of Nigeria, 1999 (CFRN) was preceded by a nationwide debate organised by the Constitutional Debate Coordinating Committee (inaugurated on November 11, 1998), it has never been regarded as a genuine product of the people of Nigeria. This is mainly because the Military Government had a dominant influence on its contents, whereby it endorsed many practises of the military era which were more unitary than federalist. There have therefore been persistent calls for change.

In response to these persistent calls for amendment of the Constitution, the Presidency and the National Assembly have initiated several review exercises in the past in which Lagos State government always participated actively.
On Thursday, September 15, 2011, the National Assembly again inaugurated a Committee on Constitutional Review aiming for a holistic review of the CFRN and further amendment to its provisions. This is expected to be the first major amendment that will cover several significant subjects in the Constitution. However, this exercise does not aim at a general review of the Constitution. It seeks to proceed only on the following selected areas: (1) Devolution of powers; (2) Creation of states; (3) Geo-political zones; (4) Traditional rulers; (5) Local government; (6) Land Use Act, NYSC Act and Code of Conduct; (7) Fiscal federalism; (cool Immunity clause; (9) Mayoral status for Abuja; and (10) Nigeria Police. My presentation, therefore, will be limited to these areas put up for consideration by the Senate.

Devolution of powers

The defining feature of federalism is the autonomy of each government that makes up the Federation. Our political experience and long era of military rule has, however, resulted in the Exclusive Legislative List being loaded excessively in favour of the Federal Government at the expense of the state governments. The effect is that whilst the states are precluded from performing several important constitutional responsibilities, the Federal Government is equally unable to function effectively as it holds legislative and executive powers on matters of local concern which over-stretch its administrative and supervisory abilities.

It is therefore the position of Lagos State that the principle of appropriateness (i.e., which order of government is more appropriate to deal with and effectively supervise a particular subject) should guide the sharing of powers between the federal and state governments. We therefore recommend that the items on the exclusive list be substantially reduced to reflect the principles of appropriateness and state autonomy.

In particular, state legislatures should have or share jurisdiction on subjects like police, criminal records, prisons, evidence, establishment of air and seaports, railways, electric power generation and distribution as well as the taxation of incomes, profits and capital gains.

Creation of more states

It is the position of the Lagos State government that the Nigerian federation does not at this time require the creation of additional states. This view takes into consideration the huge cost which the administrative machinery and personnel of the new state will entail. Most states are currently not sufficiently viable to justify further subdivisions.

Also, we want to draw attention to the largely untapped administrative potentials of the existing local government councils, which can easily be used to cater for local or sectional interests. Indeed, it may well be that the agitation for more inclusiveness in governance and for rapid development may be better addressed by the creation of more local governments than it can be done by the creation of more states.

Recognition of six geographical-political zones

The six geo-political zones represent an informal division of the Federal Republic of Nigeria along the lines of geography and ethnic sub-group. Though not recognised by the Constitution, the zones have become representative of a political configuration of sort. Thus, it is not uncommon to have political appointments and decisions recognising this loose arrangement. This has led to the clamour for the recognition of the zones in the CFRN.

However, we do not support the inclusion of the zones in the Constitution. Recognition of a body in a constitution presupposes that it will have a definite purpose or responsibility and its composition, leadership and administrative structure will have to be defined.

Since the geo-political zones are not intended to be regional governments, their inclusion in the Constitution may cause unnecessary confusion as to their status or significance. Section 14(3) is comprehensive enough to reflect the federal character of the country and the need to promote national unity.

Role for traditional rulers

Lagos State government recognises the institution of traditional rulership. However, traditional rulers do not derive their relevance and authority from the Constitution. Unlike the Federal Government and state governments which are created by the Constitution, and local governments which are created by laws made pursuant to the Constitution, the institution of Obaship predates constitutional governance in Nigeria. Their appointment, removal and terms of office are regulated by the traditional norms of the people which are peculiar to each town/village and cannot be uniformly regulated by the Constitution.

Also, it should be noted that the idea of federalism involves the surrender to a central authority of only those functions which are best regulated and discharged in common. It is therefore contrary to our federal intent to seek to unify diverse cultural traditional institutions in the Constitution. Subjects of local peculiarity must be kept with the sub-national entities. Each state should therefore be encouraged to use their relevant Obas and Chiefs Laws rather than make it a constitutional matter.

Local government

The Nigerian Constitution makes it compulsory that local government councils shall be the administrative organs of states. However, the duty to legislate the establishment of the councils as well as their structure, functions and finance is left to the State House of Assembly (s.7).

The Constitution also provides (schedule 4) that LGCs will participate in the socio-economic affairs of the state. Although local governments are guaranteed a share of the funds accruing to the Federation Account, their share is in fact required to be allocated to the relevant states for the benefit of the LGCs in accordance with the applicable state law (s.162(5). It is thus clear that while states are federating units of Nigeria (s.2), the LGCs are intended as administrative structures to assist the state governments in bringinggovernment closer to the people. In this context, any proposal to confer LGCs with autonomy, distribute funds directly to them, create a new legislative list and make them into federating units would be erroneous.

The use of number of LGCs in revenue allocation has also created an obvious imbalance to the disadvantage of some states. It is best to keep LGCs out of the Constitution and allow each state to create the number it considers appropriate for its local administration. It seems therefore that the proper thing to do is to leave the local governments out of the Constitution or vest the entire responsibility for them in the states and amend the Constitution accordingly by deleting or amending, as the case may be, all sections that introduce them into the Constitution such as 3(5), 7(1), 8, 167 and part of the First Schedule dealing with boundary descriptions.

Removal of certain enactments from the constitution

Currently, section 315(5) of CFRN incorporates certain enactments as part of the Constitution. These are the National Youth Service Corps Decree, the Public Complaints Commission Act, the National Security Agencies Act, and the Land Use Act. The section further provides that these enactments ‘shall not be altered or repealed except in accordance with the provisions of section 9(2) of the Constitution.’ This provision has served to freeze the affected enactments by making the process of their amendment the same as the one for amending the Constitution.

It is therefore the position of Lagos State government that the Land Use Act be separated from the Constitution and made applicable only to the FCT. Land has always been and should remain a residual matter for the State Houses of Assembly to legislate upon, hence the Land Use Act should become Land Use Law of the states. In this way, land legislation in Nigeria can be more flexible and reflective of changing practices and experiences through appropriate amendments by the state legislatures.
Also, the NYSC Act, though of significant national importance, does not merit special status above other Acts of National Assembly. However, National Youth Service should be made an exclusive legislative matter for the National Assembly to regulate.
As regards the Code of Conduct, we subscribe to the view that it should be retained in the Constitution as a minimum prescription applicable to all officials or public servants at all levels of government. Each state should, however, be free to impose higher standards on its officials through state laws or service regulations.

Fiscal federalism

Revenue allocation is central to the existence and functioning of both the Federal Government and federating states. The current revenue allocation formula by which the Federal Government takes as much as 52.68 percent of centrally-collected revenues in the Federation Account, leaving the states and local governments with 26.72 and 20.60 percent, respectively has created a glaring and unacceptable imbalance in the financial resources of the three tiers of government.

Having regard to the constitutional allocation of functions as it currently exists, the Lagos State government proposes the following for adoption as the new Revenue Allocation Formula for Nigeria: Federal Government - 35 percent; State Governments – 42 percent; Local Government Councils – 23 percent. However, if functions are moved from the Exclusive List to the Concurrent or if they are made residual, the formula should be further adjusted.

Also, if LGCs are expunged from the Constitution, the states will have to fund their councils with a proportion of their revenues as may be decided by the State House of Assembly.
In the event that local governments are removed from the Constitution as we propose, our government accepts the recommendation of the Femi Okunnu Committee and proposes a further amendment to the revenue allocation formula as follows: Federal Government – 25 percent; State Governments - 45 percent; Derivation - 25 percent; Intervention/Support Fund - 5 percent.

In addition, we take the view that derivation should not be limited to petroleum alone. It should be applicable to all resources and all revenues collected into the federal purse.
Further, the right of all Communities in the management and exploration of resources within their territories should be guaranteed by the Constitution.
Also, it is necessary to guarantee the integrity of the entire process of revenue allocation by appointing an Accountant General for the Federation to manage the Federation Account, as distinct and different from the Accountant General of the Federal Government. In fact, we think it is an anomaly for Federal Government officials to bear titles suggesting absolute nationwide jurisdiction when they are officials of the Federal Government only.

Nigerian Police

It is view of Lagos State government that the unification of the main security apparatus of the Federal Capital Territory as well as the 36 state governments and 768 local government councils has proved inefficient in a country of over 150 million persons who belong to various ethnic groups with distinctive population, language, landmass, religion and cultural attitudes. It is therefore the position of Lagos State government that the Constitution should confer power on a State House of Assembly to establish State Police with clear jurisdiction and well-articulated protocols for the regulation of its relationship with the federal force.

Judiciary

It is the position the state government that the appointment, remuneration and discipline of judges of the state High Court should be the exclusive responsibility of each state of the Federation. The functions now conferred on the National Judicial Council with respect to state High Court Judges should be part of the judicial powers of the states which ought to be carried out by the State Judicial Service Commission. We are also of the view that interlocutory appeals should terminate at the Court of Appeal, thereby reducing the time spent on litigation.

Furthermore, the scope of jurisdiction of the State High Court as provided in the 1979 Constitution should be restored. In other words, the State High Court should enjoy unlimited jurisdiction except for the jurisdiction conferred on the Federal High Court, which should be limited to Federal Government revenue, admiralty, intellectual property matter and criminal jurisdiction as may be conferred by an Act of the National Assembly.

In essence, the jurisdiction of the Federal High Court as provided in Section 230 of the 1979 Constitution should be restored. In the same vein, the jurisdiction of the National Industrial Court should be limited to matters of collective labour relations, collective bargaining and resolution of trade disputes.

Rotation of executive offices

It is the position of the Lagos State government that inclusion of provisions relating to rotation of executive offices in the Constitution is antithetical to the unity of the country, and its federal essence. Rotation of executive offices is not an antidote to the challenge of federal character unless the system of rotation will accommodate each of the over 250 ethnic groups and sub-groups in the country.

Gender and special group

Section 42 of the Constitution has already made comprehensive provisions for gender and special groups. If the essence of proposed inclusion of provisions relating to gender and special group is to ensure that discrimination is avoided, the solution should be for each state to give effect to section 42 of the Constitution through appropriate laws.

Immunity clause

It is the position of Lagos State that the immunity clause as provided in Section 308 of the 1999 Constitution should be retained in our constitution. The clause is more for the protection of the office, rather than the officeholder. It preserves the dignity and ensures the effectiveness of administration.

While it is regrettable that there may have been actions which are indicative of abuses of the privilege by some officeholders, the privilege of immunity is not for the benefit of the officeholder. It is for the benefit of the people he serves. The immunity attaches to his office, not his person, so that he will be unfettered in using that office to serve the people. The immunity is therefore appropriately limited to preventing him from being arrested or being summoned or compelled to appear in court.
If this were not the case, it is possible that the officeholder can be severely inhibited from carrying out his duties if arrest warrants or court summons are repeatedly issued and served on him.

Retention of the clause would prevent unfounded allegations of criminality against top public officials which, if allowed, would bring massive distractions. Even where the allegation that necessitates trial relates to corruption or other criminal offences, it is trite that time does not run against investigation and prosecution of offenders. What would have been achieved with the removal of the immunity clause could still be achieved at the expiration of the tenure of the serving officials.

Mayoral status for the Federal Capital Territory Administration

Lagos State is in support of the proposal to amend the Constitution to confer elective mayoral status on the Federal Capital Territory. This will give the administration a measure of autonomy and make the Mayor accountable to the people.

Special status for Lagos

Of course, there can be no better occasion to restate the case for fiscal support in the Constitution for Lagos State in her capacity as a former capital of the Federal Republic to continue to support the infrastructure that serves millions of people who choose Lagos as their home.

Being an excerpt of a position paper presented recently by the governor at a public hearing convened by the Lagos State House of Assembly on the National Assembly’s proposal to further amend the 1999 Constitution of the Federal Republic of Nigeria.

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