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The anatomy of restructuring (2)

By Douglas Anele

Aside from the inherent ambiguity in President Muhammadu Buhari’s usage of the word ‘process,’ he seems not to realise that in every geopolitical domain or entity there is an intimate and unseverable dialectical relationship between processes and the geopolitical framework within which such processes (whatever they might be) are set in motion and actualised. In otherwords, processes give life to the political cum administrative structural frameworks put in place for governance.

Processes with respect to governance practices at both the micro and macro levels are fundamentally influenced by the kind of geopolitical power relations and institutions within which they unfold such that there is reciprocal causal connection between the two, although the latter supervene over the former. That is why, despite the daunting challenges regarding the construction of an appropriate federal system that caters for the peculiarities of a given geopolitical environment, all over the world culturally complex and diverse countries tend to adopt it as the best way to balance both the centrifugal and centripetal forces that are always at play in such circumstances.

Every attentive student of politics and political philosophy knows that both at the conceptual and practical levels federalism is extraordinarily difficult to operate. What serious leaders of federations do, whether it is instituted through agreement by the federating components (United States) or largely imposed (as in Nigeria), is to work out an acceptable compromise so that a minimum level of development across the federating units can be guaranteed, or at least ensure that none is permanently disadvantaged.

In our own case, starting from the colonial period and worsened by northern military heads of state, Nigeria appears to have been designed to keep the south at a permanent disadvantage with respect to the north. This is the root of the problems that have weighed down the country since amalgamation in 1914.

British colonial administrators pretended that northern Nigeria is more monolithic than it actually was, and divided the country disproportionately into three regions, two in the south and one in the north. Geographically and territorially, the north constitutes two-thirds of Nigeria’s land mass. Again, based on the controversial census figures of 1953 and 1963 which purport to show that northern Nigeria had a bigger population than the south – a demographic anomaly given that generally all over the world forested areas tend to be much more populated than arid and semi-arid regions – more parliamentary seats were allocated to the region than the two southern regions combined, and the situation did not change even after the creation of mid-western region in June 1963.

The lopsided federal legislature meant that the north would dominate and control Nigeria’s politics for an indefinite long period of time and that no meaningful governmental decision affecting the country can be taken without the consent of northern political leaders. It also entailed that the federal government led by Alhaji Abubakar Tafawa Balewa can use the north’s parliamentary superiority to implement policies and programmes more favourable to the northern region than to the two (later three) southern regions.

Let us take a brief look at the evolution of fiscal federalism in Nigeria in order to debunk the assumption that process not geopolitical structure is at the core of our problems. Beginning from the Macpherson constitution of 1951 when regionalisation was consolidated, regional parliaments exercised concurrent and residual powers whereas the central legislature exercised exclusive and concurrent powers. Autonomous revenue and tax jurisdictions to the regional governments were introduced in addition to the principle of derivation in sharing federally collected revenue, with 50% going to the region where the revenue was collected. The Lyttleton constitution of 1954 strengthened the regional structure and set the stage for rapid development across the regions.

While the central administration was in charge of defence, foreign affairs, the police, railway, energy, customs and immigration, banking, transport and communications, the regions handled education up to the secondary school level, agriculture, public health and local government. The judiciary, public service commission and marketing boards were also regionalised.

It must be noted that the main task of the early fiscal commissions, from the Phillipson commission to the one headed by Sir Louis Chicks of 1954, was limited to allocating equitably to the regions revenues derived mostly from import and export duties, together with excise and company taxes, as determined by the central government. But the financial flow to the regions both from the central government in Lagos and their own internally generated revenue allowed them to embark on developmental projects that encouraged healthy competition among the regions.

Although the perennial issue of constructing a federation that ensures fairness, justice and balanced national development remained, and became more problematic as independence approached because political leaders from different parts of the country competed amongst themselves to occupy the commanding heights of political power after the British colonial administrators might have departed, Nigeria witnessed unprecedented development in the years before and shortly after 1960 due to the relative autonomy of the federating units which gave politicians genuinely interested in providing good governance the opportunity to implement their policies and programmes.

Therefore, without the degree of fiscal decentralisation that made it possible for Dr. Nnamdi Azikiwe, Chief Obafemi Awolowo, Dr. Michael Okpara and Alhaji Ahmadu Bello to operate or function without the overbearing influence of an overbloated central government, the impressive achievements of these iconic politicians would not have materialised.

One of the key issues hammered out during the London constitutional conference of 1957 was the revenue sharing formula to be adopted after independence. The result was the Raisman-Tress Commission mandated to work out vertical and horizontal fiscal relations between the regions and the centre. The Commission created the Distributable Pool Account (DPA) to facilitate the sharing of some federally collected revenues among the regions. Each major revenue source was divided into a portion to be paid to the regions based on 50% derivation, another to the central government, and the remaining went into the DPA for sharing among the federating units.

This enhanced the financial capacity of the regions and enabled them achieve remarkable development milestones before the crises that engulfed the country in 1966. After independence in 1960, payments to the different regions from the DPA were as follows: northern region 40%, eastern region 31%, western region 24% and southern Cameroon 5%. The north collected the lion’s share from the DPA because, as already indicated, the British deliberately delineated the country in such a lopsided manner that the northern region was more than twice the size of the southern regions put together.

But why did the British do that? Answer: for the colonialists, the dominant Islamic theocracy in northern Nigeria was malleable and made colonisation easier, unlike southern Nigeria where rebellious ethnic groups particularly in the east fought colonisation to the last. Besides, according to Harold Smith, the British saw the huge size of northern Nigeria as a bulwark of British security.

The 1963 republican constitution stipulated, among other things, that 30% of certain imports (excluding premium motor spirit, diesel oil, tobacco, and alcoholic beverages) should be remitted into the DPA, whereas import duties on fuel and tobacco should be paid by the central administration to each region based on the derivation principle. Interestingly, for royalties on minerals within the country (including petroleum) the federal government was obliged to pay 50% to the region from where the mineral was extracted, which boosted the economy of the eastern region where most of the oil deposits were located tremendously.

Adebayo Adedeji, in his work, Nigerian Federal Finance, provides data which confirm that between 1962 and 1966, revenues of the northern and eastern regions increased by a higher percentage than that of the federal government by between 4% and 13% respectively – the north because of higher federal allocation due to bigger land mass and manipulated higher census figures of 1963, the east on account of sharp increase in royalties from crude oil production.

The revenue for western region plummeted largely due to reduction in prices of cocoa at the international market and the retrogressive politics played by a coalition government of the Northern Peoples Congress and the National Council of Nigerian Citizens against the opposition Action Group in charge of western region at the time.







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