Nigerian states and shrinking revenue

That each of Nigeria’s 36 states is richly blessed with abundant natural resources in not in doubt. Not too long ago a national newspaper in its cover page posted an interesting story capturing the huge natural endowments in each of the 36 states of the federation and the Federal Capital Territory (FCT). Unfortunately, long years of visionless leadership in most of the states have ensured that these endowments have largely remained untapped while the state governments have mostly depended on federal allocations from oil revenue. This is apart from the fact that in most of the states, it is difficult to see what successive governments have done with the huge federal allocations over the years. These revenues have mostly been mismanaged or cornered into private pockets. It is on record that since the return of the country to civil rule in 1999, most of the states have not made much progress, either in terms of infrastructural development or elevation of quality of life of their people.

A glaring evidence of the gross mismanagement that has gone on unhindered in the states over the years showed itself at the inception of the Muhammadu Buhari administration when there was outcry by a good number of the then newly inaugurated governors that their states’ treasuries were empty. The new governors claimed that their predecessors left their state coffers dry while also leaving behind a huge debt burden of unpaid salaries, pension arrears, among others. As a result, they requested for a special bailout from the Federal Government, to which the Buhari administration acceded, announcing N804.7 billion economic bailout for the states.

Several months after, state governors, under the umbrella of Nigerian Governors’ Forum (NGF), came out to tell Nigerians that owing to the poor state of the economy, they could no longer pay the N18,000 minimum wage which was signed into law in March 2011 by former President Goodluck Jonathan. Reading a communiqué issued at the end of an NGF meeting, Abdulaziz Yari, Zamfara State governor and chairman of the forum, said, “The situation is no longer the same when we were asked to pay N18,000 minimum wage, when oil price was $126 (per barrel), and we continued paying N18,000 minimum wage when the oil price is $41, while the source of government expenditure is from oil, and we have not seen prospects in the oil industry in the near future.”

To say that the foregoing highlights the lack of vision of most of those who present themselves for election as governors of our states is to put it mildly. This is because, as we earlier noted, all the states are richly endowed with resources that, if properly harnessed, would ensure that the states do not depend on Abuja for survival. Regrettably, in almost all the states, conscious efforts have not been made by successive administrations to increase the viability of their states by tapping into the natural resources within their domain. Equally, many state governors have not seen the need, beyond verbal pronouncement, to increase their states’ internally generated revenue (IGR). Not many of them seem to know the abundant resources available in their states. It remains to be seen in any of the states, except Lagos, where the government has identified an area that could be developed or improved upon to beef up IGR that could cushion the effect of the oil price fall and the drop in federal allocation.

If truth be told, we must state categorically that we do not believe that any state in Nigeria should have anything to do with poverty given the huge natural endowments in all the states. What is needed is the political will to look beyond the “now syndrome” that has been responsible for the inability of leaders to think about tomorrow. The time is now for the state governors to stop paying lip service to diversification and truly begin to look beyond oil money and federal allocation.