Under the 1963 Constitution the Federal Government was entitled to pay to each region a sum equal to 50 percent of the proceeds of mining rents and royalty in respect of minerals derived from each region.
The Federal Government was obliged to credit to the Distributable Proof Account 30 per cent of the proceeds of the royalty and mining rent received by the Federal Government after it had given 50 per cent to the producing state. The Federal Government was only entitled to keep for itself only 20 per cent.
It was the 30 per cent left in the Distributable Proof Account that was shared in the following manner:
Northern Nigeria -About 40%
Eastern Nigeria -About 31%
Western Nigeria -About 18%
Mid Western Nigeria -About 6%
The system of derivation therefore encouraged healthy competition and consequential growth of the economy. Each region was assured that it was entitled, as of right, to about half of the entire proceeds of its region and also a further part constituting its own share from the Distributable Pool. Nobody then ever heard of any crisis as being witnessed today in the Niger Delta region.
The rationale for the relative peace was traceable to the agrarian system of the nation. The North had considerable reserve of groundnut and cotton, the East – oil palm and Western Nigeria cocoa, timber and oil palm. The entire nation then depended almost absolutely on income from these agricultural products.
The arrangement was an instant success. Since the only source of revenue was from agricultural products, each state emphasized and concentrated on farming. Unemployment was virtually unknown. Food was plenty, crimes were few and far between. Life was safe, corruption was almost non-existent. The Pound (our currency then) was strong. There was no external debt.
With the advent of the military, however, the federal structure was dismantled and discarded in preference for the military imposed “unitary system” in the form of federal government.
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The Revenue Allocation System was also destroyed and the military controlled all the resources of the federation centrally. The Federal Government thus monopolised all the income and distributes them to the states in accordance with their whims. The military later imposed a revenue allocation formula that gave the Federal Government the lion’s share of the nation resources as follows:
Federal Government =60%
State Governments =25%
Local Governments =10% Miscellaneous/Ecological = 5%
Subsequent attempts had been made at improving this to reduce the federal revenue to the advantage of states and local governments, but the result is still far from being equitable. It is unfair. It is unsatisfactory.
The question then is whether it would still be reasonable to apply the 1963 formula where the derivative states would keep about 50 percent of the entire nation’s wealth. The military adopted the extreme position by completely ignoring the 1963 formula and the interest of the oil producing states. The military then arrogated to the Federal Government the lion share of the revenue – a position leading to underdevelopment of the states. The states from which oil were being explored suffered serious setbacks to their farming as exploration processes destroyed fish and farmland in the region, leaving the people completely devastated. Indeed this underscores the very basis of the agitation by these people.
The Local Government Structure
Again, we have to revisit the situation whereby local governments’ Councillors earn more than Professors. It is both wasteful and uncalled for. And I ask: on what basis should the Councillors be sitting as Parliamentarians, collecting salaries, emoluments, allowances, constituency allowances and all manner of perquisites of office? Without mincing words, Nigeria cannot afford this expensive arrangement given our limited resources and the widespread poverty in the land.
What is being paid currently by Nigeria is enormous as everything under local administration is at a standstill. Nothing is just moving. All the earnings and allocations are being expended on salaries, allowances and emoluments without any visible project or developmental structure on ground to affect the lives of the ordinary man positively.
In other countries, Councillors (or their equivalents) serve on part-time basis with periodic sittings. Not only that, professionals and seasoned retired administrators and captains of industry willingly participate in local administration as they service at this level as a golden opportunity to serve and affect positively the lives of the people at the grassroots. Apart from serving on part-time basis, these professionals on local administration sit at week-ends and mostly without remunerations! And where remunerations are paid, they are only in respect of sitting allowances without more! The simple lesson for us to learn from the aforesaid procedure is that these people derive joy in serving their people in the real sense of it and without any string attached. What stops us from adopting the same method?
In the new dispensation and or structure being proposed, nothing of sort would be accommodated again as I will soon explain in future articles.
It is my humble suggestion that election in to local councils should no longer be on political party basis but strictly on zero part. I make this recommendation taking into cognizance Nigeria’s peculiar situation coupled with our pronounced underdevelopment and poverty-stricken grassroots. Perhaps it would be worthwhile at this juncture to remind ourselves that this recommendation is not totally new. We would recollect that in 1976/77, Nigeria experimented something similar during the military regime of General Olusegun Obasanjo. It was a glorious era in the annals of local government administration in this country as considerable progress was made in terms of visible achievements that touched the lives of the grassroots.
While I am not advocating a wholesome “importation” of certain system or practice from a particular foreign country, I however consider it not out of place to borrow from other climes appropriate systems which can easily be adjusted to suit our peculiar circumstance here in Nigeria. No society, I venture to say, has a one hundred percent originality in this area as there would always be something to borrow from others.
Vexed Question of Statutory Allocation to Local Government
Under the present system, revenue allocations are made to the 774 local governments. This procedure, as could be expected, has created a lot of friction between many states and their local governments.
The state government sees itself as the overlords of their local governments. Consequently, not only do some Governors withhold the allocations meant for their local governments, they even fail to make 10 per cent contribution from their revenue to the local governments.
•Please send your comments to president@abuad.edu.ng