11 November 2012

Nigeria: Resource Control - Resolving a Constitutional Controversy


Perceived gaps in the 1999 Constitution has provoked significant dissonance in the polity and continuing debate. One of such issues is that of resource control. CHIBUZO UKAIBE looks at some grey areas relating to this critical component of true federalism as a major factor that could impact the Nigerian project.

The resource control debate in Nigeria has remained a passionate arena. Not without good reason. When some state governors in early 2000 considerably scaled up the campaign to constitutionalise the issue, it was seen as a rebellion against the federal government; the struggle was quashed by the powers that called the shots.

Many failed to throw their weight behind the struggle because it was perceived as a movement by a segment of the country from a particular geographical zone. The media and non-governmental organisations apparently did not give the struggle the desired attention, eventually it died like a premature baby.

The reality of resource control as an integral part of true federalism is now glaring as Nigerians are agitating for true federalism and want it to be included in the proposed constitution amendment process for equity, justice and fairness. It is against this background that the idea of empowering the states to explore, exploit and utilize their mineral and natural resources to address their development challenges, but to be accountable to the federal government.

Central to the struggle for resource control is the right of the states and communities most directly concerned (that is the producing states and communities) to have a direct and decisive role in the exploration for, the exploitation and disposal of, including sales of the 'harvested' resources.

Some emerging consensus hold that it is those who live with the devastating consequences of reckless and irresponsible exploitation practices and procedures, who must control the mode and management of commercial production in order to ensure an environmentally friendly production process, elimination of pollution, protection of the lands, forest, rivers and atmosphere. It is they who will insist on planned and controlled production to ensure the progressive replacement of the non-renewable resource, by a renewable product that is free of pollution and other environmental hazards.

Today, many Nigerians are suffering because there are insufficient resources at the state level to provide for their social and economic welfare. Therefore, it has led to massive migration of people from the states to Abuja and other economic viable cities, whereby stretching the available infrastructures in these places.

The inadequate resources from the federal government to the state governments to tackle developmental challenges, the issue of unemployment is now at a precipitous height, poverty is cruelly ruling over most homes, unprecedented increase in infant and maternal mortality rates, terrifying terrorism, kidnapping, economic sabotage and soaring height for unbridled corruption.

Nigeria's flawed federalism has worsened its affliction with the "Dutch disease" - a condition in which a country that is rich resource-wise has continued to be lazy and imprudent. Many see the granting of right to control resources to the constituent units as a move towards ensuring economic viability of most of the units under the two lower tiers.

In the nation's history when it was Tin, Cotton, Cocoa, Groundnut, Oil palm and Rubber, today it is crude oil. Granting control of resources to the constituent units will mean encouraging each unit to exploit and develop the resources in each area. The emerging consensus is that if this is granted it will drastically tackle the sad straits the country has found itself over four decades.

According to Mr. Ashwe Chiichii, in one of his papers on resource control, "The present intergovernmental fiscal relations, otherwise known as fiscal federalism, have always been in favour of the federal government, especially since 1970 when Decree Number 13 was promulgated."

In other words, the lower tiers of government have been experiencing both vertical and horizontal fiscal imbalances as well as fiscal mismatch between their expenditure responsibilities and their revenue raising capabilities.

These combined together, have been threatening the economic viability of the state and local governments which only decentralised right to control resources can solve; whereby the present arrangement makes the two lower account unhealthy.

This is apart from the fact that what they even received from the said federation levels of government are almost depending only on the revenue allocated to them from the Federation Account is grossly inadequate to match their constitutionally assigned responsibilities.

This is the reason why it has been difficult to arrive at an acceptable revenue sharing formula. To date, nineteen attempts have been made in the history of Nigeria to evolve a formula acceptable to all but to no avail more so that the Federal Government has, especially from 1970, always been placing enormous resources at its disposal under the guise of national unity.

As Dunmoye Ayo noted, there is no gainsaying the fact that the oil producing states have the constitutional right to demand for resource control. It is a political as well as a constitutional issue, he added. It is also a kind of situation whereby the Nigerian fragile federation is finding itself in a level field for re-examination. Since that 1966, the kind of federalism we have been practising in Nigeria has been unitary in nature; with the federal government holding other units as mere vassals with virtually no power for self-determination.

The growth of the activities of ethnic militants and ethnic conflicts is no news in the history of Nigeria today. The growth is traceable to their disaffection with the practice of federalism and its corollary fiscal federalism in Nigeria. Now, terrorism is growing tremendously, and more people are indulging in frightening criminal activities.

This is more so that the federal government is increasingly sees as having failed as a state in addressing infrastructural development in Nigeria. In the political sphere, the stability of our political entity called Nigeria is being threatened because of the centre that is too powerful politically and economically.

The agitation for resource control is a response to the failure of the state or federal government in providing and developing social infrastructures. The state should wake up to its legitimate social roles by embarking on infrastructural development (fairly distributed) and people-oriented policies and programmes.

Over 13 years, Abuja has become a major attraction of Nigerians as they flock to the territory in large numbers from the states and local government areas for survival. This has therefore over stretched the available facilities provided. Unfortunately, there is not enough provision made by the government to accommodate every Nigerian in Abuja, whereby they have made personal effort to build their houses and establish businesses in places designated for other purposes.

As a result, they have become vulnerable and victims of demolition exercises by successive administrations in the FCT. Recently, 19 towns the FCT were listed for another devastating round of demolition exercise by the FCTA without any alternative for those to be displaced.

According to Dr. Otive Igbuzor, activist and public affairs analyst, "There is no doubt that majority of Nigerians agree that federalism is the most suited system for governance in Nigeria. However, the history and operation of constitution in Nigeria shows that it negates all federalist principles and practice. In any case, it is clear that control/allocation of resources is a constitutional issue.

Meanwhile, the struggle for resource control in Nigeria has not given sufficient attention to constitutional reform. There is therefore the need to place emphasis on constitutional reform in the on-going struggle for resource control in Nigeria. It is clear that there are progressive elements from all parts of the country that support the struggle for resource control."

He recommended that the states should be made to pay taxes to the federal government but with the consent of the states. "The federating units should have control and ownership of the resources in their area. They should however pay taxes to the Federal government. The rate of such taxes would need to be determined in consultation with the states.

The rate may, however, not be more than 50%, considering that states would take on more spending responsibilities under true federalism. The taxes so collected should go into the federation Account. Allocation from the federation Account shall be to the federal Government, Equalisation Fund, and the Local governments.

Allocation from the Equalisation Fund to states shall be based on agreed criteria. These would, however, include state income shortfall from the national average income, population, and land mass and terrain. Section 44, (1) (3) should be amended to vest ownership of resources in states."

Igbuzor concluded by calling on well-meaning Nigerians to throw their weight behind the struggle for resource control, "We must therefore network and build alliances across every geopolitical zone in the country to ensure the success of the struggle. The struggle for resource control in Nigeria is a just struggle. The ruling class may postpone its realization. They may put obstacles to its realization but they are destined to fail. The struggle for resource control must be won for Nigeria to remain as one nation."

The emerging consensus now is that the issue of resources control is an agitation by a segment of the country, rather it is a national issue that cuts across the entire states of the federation because it affects the entire system. It can be recalled that most Nigerians aggressively protested against the New Year pronouncement of fuel subsidy removal by the federal government, and their agitation paid-off as the pump-price of petrol was reversed from N141 to N97 per litre.

But they are yet to realise that the current predicament of strangulating poverty and violence across the land could be solved when resource control is entrenched in the constitution, whose benefits are enormous to all Nigerians born and unborn.

Resource control will provide sufficient resources at the State and local government levels which will metamorphose into unprecedented job creation for the teeming population; this current glut in the labour market and unnecessary brain drain will be curtailed to the barest minimum.

When the constitution accommodates resource control every state of the federation will experience huge attraction of foreign direct investment, because the various states and local government areas are heavily endowed with mineral and natural resources that can transform the lives of its citizens, and it will fast-track the development process, and then poverty will be a thing of the past.

Some public issue analysts hold that empowering the states through resource control will drastically reduce the 'mad rush' to the cities, especially Abuja. This group further hold that it will make people from the different states to stay home to contribute to the development of their states. Perhaps, most importantly, it will shrink the issue of settlers-indigenes debacle as currently being experienced in some states.

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