Guardian Confab: Derivation As ‘Downstream’ Challenge For Regionalism SUNDAY, 20 OCTOBER 2013 00:00 BY MARCEL MBAMALU NEWS - NATIONAL Ajimobi • Oil Communities Threaten States Over 13 percent Fund AS Nigerians mull the national dialogue proposed by President Goodluck Jonathan, the contentious issue of revenue allocation came to the fore at the weekend, when stakeholders, including state governments and oil communities from the Southeast, South South and South West called for total overhaul of the sharing formula to jettison the criterion of landmass and emphasise that of derivation and population, among others. But the war between Governors of the nine oil/gas producing states (Ondo, Edo, Delta, Bayelsa, Rivers, Akwa Ibom, Cross River, Imo and Abia) over who is constitutionally empowered to collect the 13 percent monthly allocation from the Federation Account assumed a worrisome dimension as the leadership of the oil/gas producing communities of Nigeria told the Elias Mbam-led Revenue Mobilisation, Allocation and Fiscal Commission’s (RMAFC) zonal hearing in Yenogoa that anything short of direct allocation through the National Derivation Board is not only unacceptable but a direct invitation to unimaginable crisis. From Enugu, Abia, Anambra, Imo, Akwa Ibom and Oyo, among others, came strong demands to whittle down the powers of the Federal Government over the nation’s wealth, even as oil communities, in a move that smacks of disagreement with their parent states governments, re-iterated their call for direct remittance of the extant 13 percent derivation funds to them. Abia State Commissioner for Local Government Affairs, Emma Nwabuko, painted a gloomy picture of deprivation being suffered by his state since its creation in 1991. He, therefore, canvassed a revenue sharing formula that would give 45 percent to Federal government, 32 percent to states and 23 percent to local governments, even as he explained that the responsibility of governance is gradually shifting to the states. Enugu State’s Economic Adviser, Mr. Dan Onyishi, who presented the position of the state government, said it supports reviewing the sharing formula to give 40 percent to the federal government, 40 percent to state government and 20 percent to local government. Ebonyi State Commissioner of Finance, Timothy Odah, said the federal government should get 46 percent from the common purse; state governments 35 percent, while 16 percent of the nation’s revenue goes to local governments. Odah’s position on local governments, however, attracted the ire of Chairman of the Association of Local governments of Nigeria (ALGON), Ebonyi State Chapter, Celestine Igberi, who mounted the podium to oppose the proposal. Igberi, who is the chairman of Ikwo Local Government, said that the proposed review should give 25.5 percent to the local governments, 30 percent to the state governments and 45 percent to the federal government in view of the various responsibilities the councils have undertaken since the inception of democracy. Anambra State Government’s position was canvassed by the Secretary to State government, Oseloka Obaze, who suggested that 40 percent should go to the centre, 40 percent to state governments and 20 percent to local governments. The State, according to him, would like the two-track Vertical and Horizontal methods to be revisited. Using the Vertical Revenue Allocation Formula, he said that the Federal Government gets some 52.68 percent; State Governments, 26.72 percent; and Local Governments, 20.60 percent. Secretary to the State Government (SSG) in Akwa Ibom, Mr. Udom Emanuel, who represented Governor Godswill Akpabio, at a three-day forum on revenue sharing fomula, also canvassed a vertical and horizontal allocation formula. Giving a breakdown of the proposed Vertical formula, Udom said the Federal Government should allocate 40 percent of the total federal revenue to itself, 36 percent to state governments, while 24 percent should go to local governments. For Horizontal allocation formula, according to Udom, 40 percent should be allocated across board based on the principle of equality to states; Land mass 10 percent; social development factors, 10 percent; population, 15 percent; population density 15 percent; and internally generated revenue 10 percent. Secretary to Bayelsa State Government, Professor Edmond Allison Oguru, in his presentation, demanded upward review of revenue allocation to states. Lamenting the level of environmental degradation occasioned by oil exploration and exploitation activities in the Niger Delta, he pointed out that the current 13 per cent derivation principle was grossly inadequate to address the challenges confronting the region.
Posted on: Sun, 20 Oct 2013 07:15:09 +0000
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