A New Revenue Sharing Formula

The outcome of the second Economic Summit of the Governors of the South South region held recently in Asaba, Delta State capital, under the auspices of the BRACED States, comprising Bayelsa, Rivers, Akwa-Ibom, Cross River, Edo and Delta States raised much food for thought.

Coming at the time it did, following calls by the Northern governor’s forum for a review of the revenue sharing formula in their favour,  while calling for a reduction of what gets to the oil bearing states is also very thought provoking as it is hypocritical.

But the quality of participants who attended the summit, no doubt, underlines the fact that there is need for regional integration to foster much needed accelerated development that would translate into a boost in infrastructural development and job creation for the over 30 million unemployed youths of the country.

Apart from the fact that majority of the governors in the region attended the parley, the presence of stars like Noble Laurette, Prof. Wole Soyinka and the Minister of Finance and Coordinating Minister of the nation’s economy, Dr. Ngozi Okonjo-Iweala, among others was indicative of the relevance of such regional integration for socio-economic growth of our country.

At the end of the day, the communiqué issued after the summit showed that the purpose of the meeting was to showcase the rich investment potential of the South South, so as to attract new investors in order to facilitate the servicing of external investments.

It also aims at developing integrated transport facilities in the region through balanced development of rail, roads, waterways and airport facilities, to partner the federal government and the private sector in the development of the Lagos – Calabar Railwaylines project and press for the urgent completion of the East-West Highway, among others.

On the whole, the plan of the South South governors could promote the desired accelerated development of the region in a way that could guarantee peace, unity and sustainable development of the BRACED States, and the country at large..

It was, therefore, not surprising that  one star at the Summit, the Chairman of the Group, Governor Chibuike Rotimi Amaechi of Rivers State used the opportunity to highlight the need for a review of the revenue sharing formula which is currently skewed in favour of the federal government. According to him, it was improper for the federal government to keep 52.4 per cent of the money from the Federation Account while the real development centres, the states and the local government areas kept the balance.

Besides, Amaechi took a swipe at the federal government over the Sovereign Wealth Fund, saying that during the last allocation, the federal government collected N400 billion from the Federation Account and gave about N100 billion to the 36 states, a position that could hardly meet development challenges in the states of the federation. There is no doubt that the BRACED States, like other regions in the country are entitled to air their views on issues of national concern like revenue sharing, security issues, due process and the fight against endemic graft that is currently ravaging the nation.

But the BRACED States seem to be harping that they, being the states endowed with the resources that bolster the nation’s economy, and in view of the deprivations suffered by their people following activities of the extractive industries that operate therein, operations that have caused degradation of their environment and loss of their traditional sources of livelihood, the states impacted upon, albeit negatively by oil exploration activities, deserved more funds from the Federation Account.

Though, it is never easy for one to let go any source of revenue, not the least, the federal government of Nigeria which sharing formula is lopsided against the South South region, this call for a review of the revenue sharing formula by the BRACED States’ governors is quite timely, especially in the face of the current constitutional review that is on-going.

If one may ask, what is the business of the federal government with a Ministry of Works and a Ministry of Agriculture, for example? This question is pertinent if one considers that the real development centres like the states and local government areas also have similar institutions, which in other words means that by running the same or similar Ministries, the country may be wallowing in duplication of efforts, which ultimately gives room for fraudulent activities by unscrupulous citizens who cherish the ripping off of the government at the slightest opportunity.

The case of the Federal Ministry of Works comes to mind in this respect as one that should be scrapped immediately while its functions should devolve upon the states. This suggestion is timely because of the failure of the federal government to adequately maintain federal roads across the country, a lapse which invariably, leads to avoidable road accidents on federal roads.

The need for the federal government to have a rethink over the number of ministries under its watch particularly the Works Ministry which duties the various state governments also handle cannot be over emphasised. This call has become necessary following the deplorable nature of federal roads across the country, a situation which leads to incessant road accidents, for example, only last week, the Lagos-Ibadan expressway multiple automobile crash killed quite a number of Nigerians, which drew the ire of governors of the western geo-political zone.

This prompted the Governors of the Western States to meet President Jonathan to discuss how to put the road in order, thus signalling the failure of the Federal Ministry of Works whose duty it was to put the road in order. Had the road been under the care of the Western States’ governors, knowing their commitment to the development of their people and area, it is inconceivable that the Lagos – Ibadan Expressway could have been left in such deplorable condition to the extent that it became a national disgrace.

Therefore, the call for a  review of the distribution of the national revenue, taking into consideration the contribution of the various geo-political zones, could not have come at a better time than now. This is because the states of the South-South geopolitical zone have this peculiar terrain that has been worsened by the uncontrolled activities of oil prospecting firms to the disadvantage of the people who are rendered helpless by certain obnoxious laws that have so far denied them the use of  their God-given resources for the development of the region.

Rivers State Governor, Rt Hon Chibuike Rotimi Amaechi who has great passion for  transformation of  Rivers State into an eldorado  of sorts even noted this point when he recently hosted the Senate Committee on Niger Delta, led by its Chairman, Senator James Manager.  The governor had told his guests that transportation and power were the keys to the transformation of the Niger Delta.

According to the governor, the advisory body of the Niger Delta Development Commission (NDDC) consisting of governors from the NDDC states had agreed that the agency should complete old projects littering the region, while also concentrating on power and transportation.   While that is being done, the advocacy for more review to the Niger Delta states should be intensified to drive development programmes of the region, now that this wasting asset, crude oil is still flowing.