Leadership (Abuja)

20 February 2013

Nigeria: Senate Rejects 13 Percent Derivation for Solid Mineral Producing States

The Senate, yesterday, rejected a bid to ensure that President Goodluck Jonathan see to the immediate implementation of 13 per cent derivation formula to solid mineral producing states as it applies to the oil sector.

Also, Senators halted moves to probe the federal government's Natural Resources Development Fund. Instead, federal lawmakers detailed the Senate Committee on Solid Minerals to embark on holistic assessment of solid minerals development in the country.

The development was sequel to a motion sponsored by Senator Abu Ibrahim (Katsina/CPC) on the development of solid minerals sector as a panacea to the bankruptcy of States of the federation and creation of jobs in Nigeria.

In wide-ranging debates on the motion, Deputy Senate President, Senator Ike Ekweremadu renewed the call for introduction of fiscal federalism to allow States develop mineral resources.

Ekweremadu decried the current trend in which many states depended largely on allocations from the federal government for their survival.

"In a situation where the federal government appropriated everything to itself and then feeding the rest of the States like a baby is really not sustainable.

"So, it is important that we begin to think about how to ensure that we will run our federal system in the best way as others are running their federal system.

"It is important at this stage for us to find a way to engage on this subject in such a way that we will be able to have what is actually called a true federalism.

"This will enable every part of Nigeria to exploit the resources that God has given to them and contribute to the centre which is the standard practice in most federal," The Senate President said.

In another contribution, Sen. Ahmed Lawan (Yobe/ANPP) said the federal government has failed to account for the funds sourced through the Natural Resources Development Fund (NRDF).

Lawan said if judiciously utilised, the money would have helped to empower the sector to create jobs for the teeming population of unemployed youths n the country.

"About N873 billion was deposited in the NRDF account but sadly, nobody can account for this money. Substantial part of the amount has been used to service other sectors of the economy.

"I believe solid minerals sector can do more than oil in the provision of jobs and infrastructure. We must do something to salvage our economy." He added.

Also speaking, Senator Smart Adeyemi blamed the State Governors for paying more attention to receipt of federal allocations while they neglected the abundant mineral resources in their States.

Adeyemi urged the federal government to change its economic policies by diversifying the economy to facilitate creation of jobs.

"It's the lack of vision and commitment of State Governors who depend on federal allocations.

"We must change our economic policies and diversify to be able to create jobs, "he said.

Sen Olubunmi Adetumbi (Ekiti/ACN) said the federal government should be held responsible for abusing the funds meant for the development of solid minerals.

He said a sizable portion of the fund had been used to service budget deficits at the expense of developing the solid minerals sector to enable the States earn 13 per cent derivative like the oil producing areas.

"The agency of government responsible for development of solid minerals is responsible for the abuse of this fund. The greatest saboteur to this policy is the federal government itself.

"A huge portion of the fund has been used to service deficit budgets and not to develop the solid minerals.

"Federal government should lead by example. It must live up to its promises by accounting for the N783 billion in the last 10 years, "Adetumbi advised.

In his contribution, Sen Ayogu Eze (Enugu/ PDP) called for the return to fiscal federalism to allow the States to exploit mineral resources and pay royalty to the federal government.

The federal government should wake up to its responsibility by providing the necessary funding to enable States to exploit the solid minerals.

"If the owners of the mineral resources are allowed to explore and pay royalty to the federal government, all will be well with the States.

"It's a shame on the part of this country that we make such provisions and they are not utilised. There's a need for the federal government to become responsive to the development of solid minerals," he said.

Similarly, Senator Ita Enang (Akwa Ibom/PDP) called for the strict compliance with existing laws guiding the exploration of the solid minerals in the country.

He alleged that some State Governors deny the federal government revenue under the guise of illegal mining.

"It's time that we allowed true federalism in this country. Some States are exploring solid minerals and keeping the proceeds under the excuse that it was illegal mining," he said.

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