By Jide Ajani

 The Forum for Inclusive Nigerian Development (FIND), packaged a symposium with the theme, Diversifying State Economies and Creating Opportunities for All Nigerian Citizens, penultimate week.    But before now, FIND had been engaged in several processes with a view to assisting the Nigerian government and people explore fresh and progressive sources of funding for infrastructural development – all these, before the disturbing drop in the price of crude oil

It is already a bitter/sweet moment for him.    Muhammadu Buhari, that is.

Sweet because it was only at the fourth attempt that he succeeded in winning the presidential election in Nigeria.    However, the bitterness of the taste in his mouth has to do with the poisoned moment that he is mounting the saddle.    For a country that was recently making as much as $125 per barrel of crude oil, the nation’s main export commodity, it is no laughing matter that it is now selling a barrel of crude for between $50 to $60.

Yet, more than two years ago, some saw it coming.    The Consensus Building Institute, CBI, based in the United States of America, and the New Nigeria Foundation, NNF, a Nigeria-based NGO, saw it coming.

Between Professor Femi Ajibola, lead staff at NNF, and Dr. David Fairman, CBI lead staff, they saw it coming while the leadership in Nigeria was fiddling away.

Bringing together some Nigerians of integrity, the NNF and CBI midwifed what is now the Forum for Inclusive Nigeria Development, FIND – it was formerly known as Forum on Oil and Gas Revenue for Development, FOGARD.

The objective was to chart a pathway through which Nigeria’s reliance on a mono-product for financing development could be progressively short-circuited.

They achieved that.

Firstly, they made it very clear that the paradigm of Nigeria’s oil wealth was based on a fallacious foundation.    The conventional thinking in Nigeria dictates that the country “is sufficiently endowed with oil and poor economic outcomes can be resolved if oil resources are better managed.    This is a flawed paradigm.    Oil revenue, however judiciously managed, is insufficient.

FIND’s message and mission is located in the inclusive nature of the various strategies of engagement, believing that once it is able to achieve the connection of ensuring that the people buy into the agenda for inclusive development, getting them to participate more actively would be easier.

And because Nigeria is a nation where forward-thinking is usually made to engage the reverse gear, it is mostly about all motion and no movement.

In 2012, for instance, records show that Nigeria shared N5.959 trillion between the federal, state and local governments.

Therefore, penultimate week, FIND decided to, as a matter of urgency, assist the in-coming public officers explore new possibilities.

In its report after the two-day event, FIND notes that the need to diversify the Nigerian economy and generate non-oil revenues for state and national development was reaffirmed.

The symposium was organized as part of FIND’s strategy for promoting public discourse and generating ideas for states in order to achieve self-sustenance, economic growth and development. This is against the background that a lot of states depend on the federal allocation for sustenance in spite of the dwindling federal allocations occasioned by the fall in the price of crude oil. The symposium attempted to address the issue with some recommendations for the way forward.

The event held at the Orchid Hotels, Lekki on 19th  May2015 with over 30 participants from various sectors including government, non-governmental organizations (NGOs), academia, National Youth Service Corps (NYSC)and the media. The theme for the symposium was “Diversifying State Economies and Creating Opportunities for All Nigerian Citizens: What Have We Learned, And What Is the Best Way Forward Now?”  A four-man panel of discussants were invited to do justice to the issues and they included Prof. Akpan Ekpo, Director General, West African Institute for Financial and Economic Management, WEIFEM; Prof Ndubuisi Nwokoma, Head of the Department of Economics, University of Lagos; Senator Olubunmi Adetunmbi, Senator, Ekiti North Senatorial District; and Mr. Babalola Olabisi, Tax Controller, Federal Inland Revenue Service (FIRS), Lagos State. The event was moderated by Tunji Andrews, Managing Director/Chief Analyst at SBM Intel.

The symposium started with an assessment of the current status of internally generated revenues by states and the federal government. The consensus among the panellists was that almost all the states (except three) had problems with generating funds beyond federal allocations, while the federal government totally depended on oil revenues. Mr. Babalola asserted that most of the states are in trouble because they depend largely on monthly statutory allocations from the Federation Account and do not have sufficient funds to survive. Senator Adetunmbi added that “a lot of the states are unable to cope with their salary obligations, with some states owing up to six months’ salary.    He added that if we take state IGR as a proxy for staff productivity, they are generating less thanN3,000 per staff; only Lagos generates up to  N250,000 per worker; meanwhile minimum wage in Nigeria is  N18,000 salary per month”.

Prof. Akpan Ekpo noted that “some states are negotiating with staff to reduce salaries by 40%”, while Prof. Ndubuisi Nwokoma stated that “the cost of governance was too high and many of the states are not economically viable”.

On the whole, the panellists agreed that the states are performing poorly in terms of internally generated revenue and Nigeria should no longer depend on oil for revenue generation since it is not sustainable, particularly as Nigeria has no control over oil pricing. They emphasized the need for all states to look inwards for other sources of revenue and reduce their dependence on federal allocations.

The second segment of the symposium focused on challenges and opportunities for economic and internally generated revenue (IGR) development in Nigeria. The panellists highlighted various challenges including lack of state data to determine economic status of each state; over dependence on revenues from oil and federal allocations; high unemployment rates and poverty across states; poor infrastructure and lack of good governance and accountability; implementation of “white elephant projects” that do not add value to the states in terms of employment generation; neglect of resources that could be harnessed from the informal sector; state control over LG resources; and high cost of governance amongst others. Prof. Ekpo insisted that “states have to build a private sector or industry base before raising taxes; they need to provide basic public services to generate private revenue before they can tax; states have to provide services so people will be motivated to pay their taxes”.

One of the panellists, Mr. Babalola, believes that it is necessary to invest in the states internal revenue service and build their capacity to collect taxes from the informal sector’ “States need to invest more in their IRSs; so, then, they can identify the taxable people and activities, focus on areas of comparative advantage, they really have to bring informal sector on board, and build up tax authorities”.

Some of the opportunities identified included but were not limited to the great potentials of the agricultural sector to generate employment; vast untapped resources from informal sectors and motivation of citizens to pay taxes through incentives and provision of services.

Panellists and other participants had the opportunity to make recommendations and discuss the way forward in the last session of the symposium. Senator Adetunmbi suggested that each state should generate accurate data on population, economic and development indices that will provide a clear picture of the current economic status of each state and the potential sources of revenues that could be explored.

He believed that such data should be provided by the state bureau of statistics.    In his own submission, Prof. Ndubuisi said that “poverty could be addressed by growing economies, creating jobs, addressing population explosion, and getting technical people into the public workforce.”    Prof. Ekpo believed that there were limitations inherent in state dependence on taxes because of the current high rate of unemployment. He reiterated the importance of harnessing the potentials in the Agricultural sector by “modernising agriculture and making it large scale”.

He believed that this would create employment for a lot of people. Mr.Babalola on his part said that “if people are not paying taxes, they have no moral justification to demand for services”. Therefore, he suggested that all citizens should remit their taxes in order to generate income for states and then they can demand for good governance and accountability. Other participants also made recommendations which included identifying natural/mineral resources and other opportunities that can be explored to create an industrial base and generate employment. Agriculture and entertainment industries were said to have great potentials that could be harnessed.

Other suggestions included replicating successful state models, such as the Lagos State example, in other states; while other participants recommended that tax evaders should be penalized as deterrent to others. Panellists also suggested to FIND that it should identify and work with state governments that have capacity gaps and are willing to work with the Forum and also organise a meeting with the Governor’s Forum to suggest ways of partnering with them on the issues discussed.