By Mr Niyi Akinsiju.
The Independent Media and Policy Initiative (IMPI) has said that the subnationals are shirking their constitutional responsibility by expecting the federal government to solely carry the burden of easing the current economic situation.
The policy group said in a statement signed by its Chairman Niyi Akinsiju, that having benefitted from higher revenue inflows from the federation account as a result of the removal of fuel subsidy, the state governments have to do more for the people in their respective domain.
“To put this in perspective, the National Bureau of Statistics (NBS) reports that in 2023, State Governors got the most cash in FAAC allocations in at least seven years. This was after the petrol subsidy was removed and the currency reform availed a 40 percent increase to the country’s revenue.
“According to the NBS, FAAC shared a total of N16.04 trillion to the three tiers of government in 2023, a 37.3 percent increase from N11.7 trillion in 2022. From this, the States and their Local Governments received a total FAAC allocation of N6.57 trillion, twice the N3.16 trillion they received in 2022. The NBS particularly notes that the amount shared by the federation surged in June 2023 following President Tinubu’s removal of the petrol subsidy and liberalisation of the foreign exchange market.
“However, the increased revenue shared has not reflected in the lives of Nigerians residing in the states. While we acknowledge the feverish efforts being made by the Federal Government to manage inflation through providing more food and enhancing supply of Dollar to the foreign exchange market, except for Lagos State and a few other states, we have not seen a replication of the Federal Government’s commitment to assuaging the challenged economic circumstances of citizens at the sub-national level.
“Even in the relationship between sub-nationals and Local Government Areas (LGAs), we have observed cases of inequity, especially in the administration of local governments’ share of federal allocations.
Most governors are known to seize federal allocations that are supposed to be administered and managed by local governments for the development and the good of the people in LGAs,”it stated.
Using available data on FAAC allocations to the subnationals in recent months, the policy group questioned why they have not reflected on the lives of the citizenry.
IMPI said: “Delta State, a PDP-controlled State received the highest FAAC allocation of N214.74 billion between June and December 2023.
“Rivers State, another PDP-controlled State followed with N179.81 billion, Akwa Ibom State, yet another state with a PDP governor got the third highest sum of N145.57 billion, and Bayelsa, a PDP state with only eight council areas, received the fourth highest revenue allocation at N128.5 billion.
“Despite this hugely increased revenue, a PCL State Performance Index (PSPI) released by Phillip Consulting Ltd in December 2023 ascribes a poverty rate of 13.10 percent to Delta State as well as an unemployment rate of 31.10 percent and an inflation rate of 24 percent.
“According to the PSPI, Delta State faces significant challenges in the effective management of public institutions, provision of public transportation, and access to potable water.
“While poverty rate is 7.3 percent in Rivers State, its unemployment rate is stated at 41.60 percent and inflation rate at 31 percent. These figures are way above the national average of 33 percent unemployment rate and the 28.9 percent inflation rate respectively.
“Akwa Ibom, another high earning PDP State has a poverty rate of 22.9 percent, unemployment rate of 51 percent, and inflation rate of 26 percent with Bayelsa State recording poverty rate at 24.3 percent, unemployment rate of 36.7 percent, and inflation rate of 28 percent.
“In summary, other data have shown that most of the states in the federation are ill managed, reflective of the fact that substantial FAAC allocations received by these states have not significantly improved the condition of their residents.”
Speaking from a policy perspective, IMPI argued there was no basis for PDP governors to compare the Nigerian situation with that of Venezuela.
“We further question the basis of the Governors’ insinuation that Nigeria is treading the path to the economic situation that had become the lot of Venezuela when, indeed, the policies being deployed by the Tinubu administration are the opposite of the policy undoing of Venezuela.
“The South American country, like ours, used to binge on crude oil revenues by subsidising virtually all basic needs but when oil prices crashed, its economic vertebra couldn’t carry the burden of the weight of the populist- driven subsidies that had inflation rate skyrocketing to nearly 190 percent in December 2023.
“Rather than castigating President Tinubu, we insist he should be commended for the courage of applying policies that will redeem the country from a possible Venezuela scenario,” it added.
Niyi Akinsiju is the chairman of IMPI.
