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Fiscal federalism and restructuring in Nigeria: Lessons from elsewhere

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federal restructuring Nigeria electionA polity composed of a multiplicity of ethnic nationalities and cultural forms is best administered with a federal constitution. Such a constitution is predicated upon the principle of power sharing among a central government and regional, or sub-national units, in a manner in which they all are ‘coordinate and independent.’  This presupposes that the federating units possess an inalienable right to exact  tax,  and undertake other forms of revenue generation, while making contributions to the sustenance of the central government, which is technically their own creation. This equates the concept of  fiscal federalism.  It has been demonstrated in literature, and praxis too, that federalism constitutes the most rational framework for managing a plural social formation. Indeed, what the evidence of history suggests is that sundry plural nations that hitherto, for historical specificities, started out with unified structures of governance, are evolving along  this new path. This is with a view to allowing greater degrees of autonomy to their sub-national units, without which the loyalty of all the population, to an overarching central authority, may not be easily procured.

Nigeria is, however, one heterogeneous social formation that has, except perhaps for a very brief period, consistently failed to subscribe to this age-long pattern of state formation and nation-building. It evolved in the context of colonialism,

with a basically warped federal system, in which one component (Northern Region), was better leveraged than, and indeed operated by diktat of sort, over the other two (Eastern and Western Regions). The intervention of the military in the political process, from 1966, further swept away whatever vestiges of federalism the British colonists left Nigerians with. In their place, the ‘modernizing’ soldiers imposed an entirely unitary structure of government, consistent with their own command orientation, on Nigeria. Every constitution since then, including the 1999 Constitution (as amended), has consolidated this hierarchical structure. By the nature of the discretionary privileges  it  confers, this system has thrown up a powerful constituency in its own defense, resisting all efforts at emplacing a different narrative. Yet, it is becoming increasingly clear that neither stability nor development is possible for Nigeria with such a system.

Efforts that had been made over the years to tinker with this structure, and achieve some degree of decentralization, and devolution of powers to the federating units, remain largely tentative. These include constitutional conferences, a Civil War, amendments to constitution, forceful regime change, State/Local Government creation, etc. None has produced the desired outcome. Thus, Nigeria continues to reel in poverty, and instability, with little or no progress on the nation-building track. The country, however, remains a veritable platform for raking in humongous material benefits for factions and fractions of the ruling elites, the poster boys of state capture. An increasing appreciation of these contradictions, and the inescapable consequences thereof, provide the basis for advocacy for restructuring of the nation’s governance system in the direction of functional federalism.

Employing  the Political  Economy framework, and the state failure paradigm, I  argue that the critical factor responsible for state failure, the possibility of which Nigeria must now contend with, is social,  political,  and economic  exclusion. Deriving from this premise are two critical theses.  The first is that the inclusive  a  nation is, in  its social,  political  and economic processes, the greater its  chances  of stability and development. The second is that State  failure  is  the inexorable  outcome of  untrammelled social,   political,  and       economic  exclusivity. Meanwhile, there always  exists the possibility of ‘restructuring’ further away from federalism. One example is the type Nigeria had, moving from the three-regional structure at independence in 1960, to the current 36-state structure. This, to all intents and purposes, has engendered virtual collapse of  the Nigerian ‘federal’ system.

It is apposite, in the light of the foregoing, to proffer some specific recommendations on the direction to a more equitable and functional federal state system in the country, the type represented by post-Eritrea Ethiopia. It is to be noted that a good number of these pathways are not novel. Perhaps the most critical consists in determining what exactly the federating units are. If they are taken to be the 36 states as we know them today, a modality must be found for getting those amongst them that wish to merge, to merge. Local Government Areas must be evicted from the 1999 Constitution (as amended). They must stop being a basis for revenue distribution; and the federating units allowed full measure of control over them. The unwieldy Exclusive Legislative List, with all of 68 items, must be recast, and made to focus only on critical items that the central government is in the best position to undertake for the federation – national defense, monetary policy, foreign relations, among others. Extant Concurrent List too, must be whittled down; and an additional provision brought in to the effect that whatever is residual (left out of the two legislative lists) remains in the purview of the federating units.

The place of state police must be guaranteed, as it is elementary knowledge in statecraft that authority to make laws, must be complemented by a mechanism for their enforcement. Putting in place a framework to guarantee that the state police initiative is not abused by transient custodians of state power is not rocket science. We have indeed clearly laid this out elsewhere. In addition to the foregoing, the 2014 National Conference Report makes provision for boundary adjustment, as a way of addressing the alienation felt by some nationalities in the country over what they regard as forced separation from their kith and kin. A more equitable formula is needful on revenue allocation, in the overall context of fiscal federalism, that takes care of the genuine fears and concerns of every segment of the Nigerian population.

These are the more critical elements requisite to a retooling of the structure with  which, and a paradigmatic shift, in the way Nigeria is governed. It is the kernel of the (federal) restructuring advocacy, directed at making the so-called federal system attain to the full measure of federalism, the end-state  of  which  is greater  inclusivity, national unity, security and development. It begs the question to assume that the prevailing structure of the federal parliament, itself a product of an iniquitous power relations, can be the vehicle for the requisite transformation that will give effect to functional federalism. To be sure, it is neither rational nor patriotic to keep denying the need for restructuring, in the face of growing challenge to the very existence of the country. Rather, what is certain is the inevitability of one of several scenarios, in the event that the  constituency resistant to restructuring in Nigeria remains dominant, and sustains the  present  order.  First, the country would be lucky to remain in the state of paralysis in which it has existed  for many years, with not much hope for development, stability, or unity. A second is the relatively ordered pattern of unraveling, represented by the former Soviet Union, and Czechoslovakia – in different degrees of conviviality.

Thirdly, there is a possibility, albeit remote, of Nigeria going through the Malaysia/Singapore experience, or what I call the  Gideon Okar state formation model, anchored on the determination of a disadvantaged  ethno-national constituency to expel a politically dominant minority group, that may also be regarded as a drag on development.

The fourth scenario is what I call the ‘Yugoslavianization’ of Nigeria – cataclysmic implosion of the country along existing and newly emerging fault lines, consequent upon complete loss of control over the legion of centrifugal forces plaguing it. From this, pockets of social formations, of different degrees of viability and stability, may emerge. Finally, there is the possibility of what post-Siad Barre Somalia has come to represent – a complete collapse and failure of the Nigerian state.

It is imperative, in conclusion, to define more specifically the place of Nigerian intellectuals in the emergent existential threat faced by the country. This is one reality that must compel every  intellectual in Nigeria to transform into a public intellectual of sort, with a view to providing informed direction for exiting extant national logjam. Charles de Gaulle’s aphorism on the centrality of politics to our lives, and the imperative of resisting the temptation of leaving it to politicians alone is truer in Nigeria of today than ever before.

  • Mimiko is Professor of Political Science at the Obafemi Awolowo University, Ile-Ife, Nigeria.

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