• Address delivered on Sunday, 27 January, 1980, at the luncheon arranged by the Tribune Group to mark the Silver Anniversary of the introduction of Free Universal Primary Education in the former Western Region of Nigeria.
I AM, therefore, also satisfied that the paramount purpose of embarking on this project is to provide to known members of the NPN, avenues for making away with public funds with impunity and not to provide suitable and adequate shelters for Nigerian citizens, as required by the Constitution.
In this connection, it is apposite to recall that the suppliers of cement to the Federal Housing Estates are being paid N6.00 per bag of cement which is N2.00 or N1.00 higher than the highest retails price of N4.00 or N5.00 per bag paid respectively in most parts of the Southern States and in the Northern States. The contractors, in this case are a Mr. Coker and Alhaji Yaro who are reputed to be NPN members; and each of whom has contracted to supply two million bags of cement.
Allocation of Revenue in a Federation is a perennial problem. It is also a big problem, and always controversial. This is so, because every Government in a Federation wants, and, indeed, always has occasion to ask for more share of the federal revenue. But it is possible to tackle the problem and confine the accompanying controversy within the ambit of a rational formula of demonstrable acceptability.
From the debate that is now going on in and outside our Governments, little regard is being paid by many to reason, rationality or general acceptability. We have been afflicted on all sides by arbitrary percentages and formulae which cannot stand the glare of any sensible scrutiny or analysis. And the worst offender in all this is the Federal Government itself labouring under the misguided pseudo-scientific reasoning of the Okigbo Revenue Allocation Commission.
Both Okigbo and the Federal Government have proceeded to their conclusions from a basic assumption which itself requires to be rigorously proved and justified. From available data, Okigbo assumes, or accepts as given, that “ the relative weight of expenditure of the Government of the Federation lies between 60 and 62 percent.” But when account is taken of the Special Fund for which separate allocation of 7 per cent has been made, what is due to the Federal Government is 53 or 55 per cent. But Okigbo recommends 53 per cent not 55 per cent. Following the same reasoning, the Federal Government’s Committee of Experts is of the opinion and recommends that “a minimum of 60 per cent of the Federation Account is needed if the Federal Government is to be able to perform its functions properly.” And accordingly, Alhaji Shagari, with an air of complete self-satisfaction, comes to the conclusion that:
the proposed 55 per cent is, therefore to be seen as trimming the Federal Government resources to the bare bones in the interest of fiscal federalism …
All this reasoning is quite plausible. But it is based on the sole assumption that the expenditure of the Federal Government in the past four fiscal years, on which the assumption in based, is justifiable on the grounds of national need, prudence, economy, and sound financial management. In this regard, however, every right-thinking Nigerian knows that during the past four years, under the last military regime, the management of our public finances was characterised by extravagant and ostentatious spending, criminal waste, nauseating fraud, and blatant looting of the treasury. If our financial affairs had been conducted with honesty and prudence, we would not have spent as much as – indeed we would have spent much less than – we did during the past four years. And the percentage of the Federal Government expenditure in relation to the Federation Account would have been much less than 53 or 55 percent.
Instead of accepting the facts of the Federal Government expenditures over the last four fiscal years as given, the Okigbo Commission should have taken the trouble to do a very strict costing of the Federal Government’s function under the Constitution before making a positive recommendations as to the percentage of the Federal Account attributable to the Federal Government. This was not done.
A more damnable error follows. In distributing the 30 percent to the States, 40 per cent is to be shared on the basis of equality which the Commission pompously and pedantically calls Minimum Responsibility of Government; 40 per cent on population basis; 11.25 per cent to be shared on the basis of inverse enrolment which will be represented by the number of children of primary school age who are not in school. From what I have just said, a few compelling comments arise.
Firstly, having regard to recent disclosures of large-scale pillage of public funds by means of inflating contract prices, it stands to reason that the Federal Government’s share should not be more than 45 per cent, but not less than 40 per cent. In this connection, it must be borne in mind that the contracts for the supply of building materials for Federal Housing have been inflated by at least 28 per cent. Higher inflation has taken place during the past four years, and it taking place in other areas not yet disclosed to the public.
Secondly, every kobo spent on the Okigbo Commission is a total waste, because the formula arrived at by it is in no way better than the thumb formula followed by us in the recent past in connection with revenue allocation. In the past, it was 50 per cent on the basis of equality and 50 per cent on population; now it is 40 per cent and 40 per cent respectively plus inadequate homage to Social Development criterion.
To be continued