Lagos federalism and resource control

Lagos, federalism and resource control

THE involvement of Governor Bola Tinubu's government of Lagos has broadened the geography and deepened the ideology of the resource control struggle in Nigeria. The state hosted the Akodo Resort Summit of the 17 southern governors on the subject. Governor Tinubu and his aides have continued to do brave advocacy for the restoration of a federal system congruent with autonomy for the constituent units. For being the arrow-head of the post-June 12 drive for decolonisation of Yoruba areas, Lagos State has stoked the liquidationist anger of the Arewa oligarchists who have been the colonial overlords of post-civil Nigeria since 1970. The threat by Abuja to declare a state of emergency and the politics to frustrate the ENRON independent electricity project are part of this revisionist plot. But under Tinubu, Lagos remains undaunted. As the most economically viable area of the Yoruba west, Lagos is strategic for the overall redemption of Nigeria. The solidarity between Lagos and the oil-producing colonies (states) is vital for the transformation of the country into a democratic and industrial leader in Africa. These reflections on Lagos and resource control are a tribute to the people of the state where I have lived and thrived these past 10 years.

The two phrases, "Resources Control" and "Sovereign National Conference" have dominated the political lexicon of Nigeria in the past one decade. The idea of a national conference gained currency in the heady days of resistance against Gen. Sani Abacha's military junta. The term was employed then to represent the sum total of the demand and agitation for the restoration of the June 12, 1993, electoral mandate of the late Chief M.K.O. Abiola. The phrase was popularized by the pro-democracy movement, which spearheaded the anti-military mobilization from 1993 to 1999. The two key elements of the demand were:

(i) The convocation of a national conference with sovereign, innvovacable powers to restructure the Nigerian Federation to make it regionally balanced, fair and just.

(ii) To use the opportunity of the conference to restore fiscal federalism such that the constituent units will have power over the ownership and control of their major economic resources and determine the way to explore them to promote development, modernization and the well-being of the people.

In historical terms, the phrase "Resource Control" is older than that of the "Sovereign National Conference". The initial echo of resource control came in the wake of the launch in 1990 of the Ogoni Bill of Rights. One of the demands in the bill was that the Ogoni people of Rivers State have the inalienable right to own their land and the resources contained therein. The Movement for the Survival of Ogoni People (MOSOP) argued in its manifesto that the Federal Government of Nigeria had denied the Ogoni this right by giving Shell licence to exploit oil and gas in the area. Relying on environmental arguments, the Ogoni estimated that Shell and Nigeria should pay them a compensation of US$30 billion for the exploitation and environmental hazards from 1958-1990. As we are all aware, the struggle went on till 1995 when MOSOP president, Ken Saro-Wiwa and eight of his colleagues were hanged on November 10 of that year. Nigeria has not remained the same since then.

But it was the "Kaiama Declaration of the All-Ijaw Youth Congress of December 1998 that raised the resource control demand to the level of a political manifesto. After reviving 40 years of the plunder of Niger Delta oil wealth, the declaration stated as follows:

1. "All land and natural resources (including mineral resources) within the Ijaw territory belong to Ijaw communities and are the basis of our survival."

2. "We cease to recognize all undemocratic decrees that rob our people/communities of the right to ownership and control of our lives and resources, which were enacted without our participation and consent. These include the Land Use Decree (1978) and the Petroleum Decree (1969), the lands (Title vesting, etc) Decree No. 52(1993) and the National Inland Waterways Authority Decree No. 13(1977). The Kaiama Declaration is also significant because it was drawn up in the birthplace of Isaac Adaka Boro who, like Fidel Castro, led an Ijaw guerrilla army in February 1966 to proclaim a Niger Delta Republic. The rebellion lasted 12 days effectively. Yet its echo has been on for 35 years now.

The twin issues of resource ownership and control are at the heart of the federalism debate in Nigeria. Professor Itse Sagay provides a handy definition of federalism as follows:

"Federalism is...an arrangement whereby powers within a multi-national country are shared between a federal or central authority and a number of regionalized governments in such a way that each unit, including their central authority, exists as a government separately and independently from the others..." Quoting Kenneth Wheare, the leading authority on the subject, Professor Sagay adds, "the fundamental and distinguishing characteristic of a federal system is that neither the central nor the regional governments are subordinate to each other, but rather, the two are co-ordinate and independent." Professor Sagay's views derive theoretical support from Chief Obafemi Awolowo, the most eloquent theoretician and practitioner of federalism in Nigeria.

The economics of federalism was emphasized by the British colonial administration through a fair derivation formula. Following the Richards Constitution of 1946, the Phillipson commission was set up on the matter. It recommended a distribution arrangement which gave 50 per cent of export earnings to regions, 35 per cent to be shared by all regions, including the region of origin and 15 per cent to the central government. The Hicks-Phillipson commission of 1951 retained the formula but added 100 per cent of mineral rents and royalties to the region where they were earned.

The Raisman commission as well as the Independence Constitution of 1960 and the Republican one of 1963 included 50 per cent of proceeds to region of mineral extraction, 30 per cent to a distributable pool for all regions, including the producing region, and 20 per cent to the federal government. In 1964, the Binn's commission reverted to the 1951 formula and this was operated till 1970. That year, Gowon's military government removed 20 per cent from the 50 per cent of the regions and took over all revenue from offshore oil. The constitution drafting committee headed by Chief Rotimi Williams practically abolished the derivation principle.

Both Aboyade and Okigbo, the two economic gurus, opposed derivation for the oil states and introduced controversial matters such as "population, equality of states, internal revenue generation, land mass, terrain as well as population density." These various principles shifted emphasis away from OWNERSHIP and ENDOWMENT. The target of this politics was the oil-producing Niger Delta.

Gen. Abacha's national conference of 1994-95 was nearly paralysed by the clamour by the oil-producing States for a higher derivation percentage of no less than 50 per cent. After a long stalemate, a sub-committee headed by the late Gen. Musa Yar'Adua recommended the minimum of 13 per cent. To pacify the aggrieved states, the idea is phrased thus in section 162(2) of the 1999 Constitution:

"Provided that the principle of derivation shall be constantly reflected in any approved formula as being not less than THIRTEEN PER CENT of the revenue accruing to the Federation Account directly from any natural resources."

In practice, the "natural resources" refer to only oil and gas produced in the nine Southern States of Abia, Akwa Ibom, Bayelsa, Cross Rivers, Delta, Edo, Imo, Ondo and Rivers. This is a reflection of internal colonialism which regards these oil-endowed states as colonies to be plundered by the federal government.

Lagos is a victim of this deprivation because it is one of the southern states that account for 95 per cent of federal revenue. The Lagos contribution comes mainly from the two sea ports (Apapa and Tin Can) which yield about 80 per cent of the import revenue of the country. The amount from the Lagos ports is about N200 billion per year. Another N5-10 billion comes from the airport and its aviation facilities. Nearly 50 per cent of the VAT (value-added tax) income in Nigeria is made in Lagos State. Altogether, Lagos contributes no less than N300 billion to the Federation Account. Yet the annual budget for the State in the past two years has been about N40 billion. This means that Lagos State is short-changed by about N260 billion of the income it should earn every year. This loss is one reason that Lagos State is in the vanguard of the struggle for true federalism and resource control.

With a population of about 15 million, metropolitan Lagos is the largest economic refugee camp in the world. Economic refugees refer to people who come into Lagos to settle and work but pay nothing to the state. The influx of this category of dwellers does not come from the distressed Yoruba-speaking states alone; millions are from the eastern states, the oil-producing states and all the 19 northern states. Since 1999, religious intolerance and communal strife have driven more economic refugees to Lagos. Governor Tinubu's government did not plan for these emergencies in the budgets. Yet the state must provide shelter and services for the victims of this internal migration.

The involvement of Lagos State in the resource control struggle is vital. Any gains made now will improve the revenue situation of the state and make it easier for dwellers to enjoy more facilities that are taken for granted in cities of similar size and age. The long term is even rosier than this. Given the geology of the Guinea Coast and the hydrology of the lagoons and wetlands, Lagos will soon be an oil-gas-producing state. It is the most industrialised city in West Africa. In a period of 15 years from now, its population will be the third highest after that of Tokyo and Mexico. In a federal system such as obtains in Canada and India, Lagos should aim to become a semi-autonomous economic zone such as Singapore or Hong Kong and Taiwan in China. The struggle to attain that freedom from internal colonial bondage will dominate the politics of the next decade.

December 2001