BidVertiser

Tuesday, 19 February 2013

MAKING THE STATES VIABLE



                                                                           
The main reason why many Nigerians are against the creation of new states is because they feel many of the existing states are not viable. They feel the only viable states in the country are the nine oil producing states and Lagos State. With only 10 states of the 36 states being viable, the remaining 26 states are regarded as parasites on the 10 viable states and the Federal Government. In this regard, they feel new states should not be created.

However, to say only 10 states are viable in this country is a fallacy. This is because every state in Nigeria is viable or has the potentials to be viable but the problems we have in this country are the 1999 Constitution, over dependence on oil revenues and high recurrent expenditures. Before we look at the problems associated with the 1999 Constitution, over dependence on oil revenues and high recurrent expenditures, we shall see why the various states in the country are viable or have the potentials to be viable. First, every state in Nigeria has many natural resources which can be tapped to generate revenues but the states deliberately left these God-given natural resources and are waiting for the Federal Government allocation which is derived mainly from crude oil.
To get a comprehensive details of the various natural resources in each state of the federation, use Google search on the internet. Also, the diaries of many companies that are operating in the country carry details of the natural resources in each state of the federation. No state is deprived of natural resources in the country. Second, apart from the natural resources which every state is endowed with, each state is also endowed with agricultural potentials. For instance, all the South-West states are blessed with arable farm lands that are fertile for the growing of cocoa, yam, oil palm, cassava, millets etc. Cocoa was one of the revenue earners for the country in the First Republic. The major source of revenue in Cote d’Ivoire is cocoa. Cote d’Ivoire is the third largest producer of cocoa in the world today. Why can’t cocoa be a major source of revenue generation in the South-West zone? The South-West should return to the farm and plant this rich crop so as to reap from it abundantly.
Nothing stops the South-East geopolitical zone from revamping its oil palm plantation or plant fresh oil palm seedlings. In the early 1970s, Malaysia came and bought oil palm seedlings, today, Malaysia is the largest exporter of palm oil in the world. Apart from crude oil, the South-South zone is also endowed with some agricultural potentials such as oil palms and rubber. The region should embark on massive planting of these cash crops so as to harvest bountifully when they are fully matured. The South-West zone is blessed with cocoa and other natural resources. Cocoa is a cash crop and it is this agricultural product that is sustaining Cote d’Ivoire presently.  Apart from the abundant natural minerals in the monolith north, the region also has agricultural potentials. The region was known for its groundnuts and cotton. The northern region should return to the farm in order to plant these two cash crops which are high revenue earners. These two agricultural products, if properly cultivated, much money could be realized from their harvests.
There is no justifiable reason why any state in Nigeria should be unviable if each state can look inward and tap the natural resources that are present in it and also develop the agricultural potentials within. Many states in the country are bigger than some countries in the world but such countries don’t wait for foreign aids before they run their governments as many states in Nigeria wait for Federal allocation before they do anything. If those states in Nigeria that are not viable were to be independent countries, won’t they survive? Are countries like Madagascar, Guinea-Bissau, Sao Tome and Principe, Bahamas etc, as independent countries, not surviving on the natural resources and the agricultural endowments they have? For instance, Madagascar derives her major revenues from Chromites, Coal, Graphite, Bauxite, Salt, Quartz, Tar Sands, Semiprecious stones, Mica, Hydropower, fish etc.   
With all these natural and agricultural resources across the states of the federation, why are many states not viable? As stated above, the reason why many states are not viable is because of the 1999 Constitution, over dependence on crude oil revenues and high recurrent expenditures. Section 162 (2) of the constitution says, “The President, upon the receipt of advice from the Revenue Mobilization Allocation and fiscal Commission, shall table before the National Assembly proposals for revenue allocation from the Federation Account, and in determining the formula, the National Assembly shall take into account, the allocation principles especially those of population, equality of states, internal revenue generation, land mass, terrain as well as population density provided that the principle of derivation shall be constantly reflected in any approved formula as being not less than thirteen percent of the revenue accruing to the Federation Account directly from any natural resources”.
Thus, with this provision in the 1999 Constitution, the Federal Government gets 52.68 percent, the states get 26.72 percent, while the 774 local governments get 20.60 percent. So, without contributing anything to the Federation Account, the states and 774 local governments receive 26.72 and 20.60 percent from the Federation Account respectively! This is the reason why many states are vegetating and not viable. The states and local governments are not challenged to compete among themselves because they know that at the end of every month they will get allocation from the Federation Account without contributing anything to the system! Now, how can the states and local governments be viable? Another reason why many states are not viable is because the entire country depends only on crude oil for its revenues. The entire country now sees crude oil as the only means of generating revenues thereby abandoning all other means of revenue generation such as solid minerals, other minerals and agricultural products etc.
The third reason why many states are not viable is because of high recurrent expenditures. All the states now engage in profligate yearly, leaving very little revenues for capital expenditure which is the backbone of development. For instance, what is the relevance of private jets being acquired by the governors to their states? Can we compare private jets with good roads, functional hospitals, quality education, adequate power supply etc? It is only in Nigeria that political office holders and elected officials use public funds to buy private jets for themselves! President Goodluck Jonathan and many state governors now have private jets! It is a known fact that the presidents of many countries including that of United States don’t have private jets, not to talk of their governors! Which governor in America has a private jet? What does the president or the governors need private jets for? How many times do they travel in a year that they need private jets for? The founder and owner of Virgin Atlantic Airline, Richard Brandson doesn’t own a private jet. In fact, he flies on the economic class whenever he travels!
It was learnt there are 200 private jets in the country presently and half of them are owned by elected politicians and government officials. These private jets gulp so much money from the annual budgets through maintenance cost and payment of demurrage. Another cause of high recurrent expenditure in the country is the security votes for the president and the governors. It is only in Nigeria that money will be allocated to the president and governors that will not be accounted for. How can money be allocated for security and no account is given on how it is spent? This practice has opened the door for corruption over the years.
 Now, having known the reasons why many states are not viable, how can they be made viable? To make the states viable, the Federal Government should give a time-span of ten years to allow the states develop the natural resources in their states. Within the stipulated time-span, the governors whose states have agricultural potentials will also develop such potentials. After the ten years time limit, each state will control its resources and pay tax to the Federal Government as it is done in other federations like the United States, Canada, Argentina, Australia, Brazil, Mexico etc. When the states begin to pay tax to the central government, it will make it unattractive and discourage agitation for zoning.
There is no reason why any state in Nigeria should not be viable if the Federal Government can give the states a ten year time-span to develop their natural and agricultural resources.  The states thereafter will control their resources and pay tax to the Federal Government. This will engender the states to engage in healthy competitions among themselves and jobs will also be created as foreign investors will come in to invest.
   

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