RESTRUCTURING NIGERIA: ATIKU, SOLUDO, TINUBU, BE CAREFUL WHAT YOU WISH FOR!

Typical of the Nigerian body politic, the political cloud has gathered around the semantic of one word: restructuring. This word, to the undiscerning, is being portrayed as holding the keys, indeed, the Midas-touch-solution to every ill that has bedevilled the Nigerian nation (Vanguard’s Ochereome Nnanna holds this view too). We have been here before. During the period of military interregnum, many activists involved in the struggle to retire the military back to their barracks, including yours sincerely, were sold on the idea that only civilian governance will be enough to guarantee that Nigeria attains her lofty heights within the global comity. The unspoken mantra was “seek ye first civilian rule, and all other things shall be added unto ye”. No attempt was made to engage the military on critical aspects of democratic governance for the future civilian government that they were birthing, nor was there any move towards advocating for the establishment of a viable structure and governance model that would soothe our peculiarities while complying with global democratic best practices. Of course, the military latched onto this naivety and the result is the structure that today’s advocates want to “restructure” with its flawed democratic culture.

Not particularly new to the lexical collections of Nigeria’s politics, this present euphoria was kick-started by the wily political actor, Atiku Abubakar, a perennial aspirant to the highest office in the land. Sensing the apparent disappointment of Nigerians with the slow start of his party, the APC, to governance, Atiku in many headline news stories called for the restructuring of Nigeria, a position he vowed he would adopt if granted the levers of power. Now, this, perhaps, was the first time a very influential and prominent politician from the North would openly question the foundations of the bond that ties the nation together. Before now, such calls have only been associated with Southern politicians. In many of his pronouncements, Atiku masterfully refused to hit the nail on the head in his explanation of what his idea of restructuring would entail but rather opined that Nigerians need to “come together, discuss, negotiate and make the necessary compromises and sacrifices needed to restructure our federation to make us a stronger, more united, productive, and competitive country”.

The ice was broken! Charles Soludo, a former Governor of the Central Bank of Nigeria and internationally acclaimed economist would next lend his voice to the palaver. During the occasion of the review of Chudi Offodile’s book on Biafra, Soludo threw his weight behind the call for restructuring but towards entrenching “competitive federalism”. This perhaps was the clearest inkling, though couched in academic elegance, into the prerequisites of a restructured Nigeria. Soludo’s position is not too far away from those of Bola Tinubu, who had shouted himself hoarse in his call for “true federalism”. Ever since, bar the lonely voices within government circles and some elements within the Arewa Consultative Forum, the crescendo has almost been attained with the cacophony of voices calling for restructuring. As the demand gathers momentum so also are the converts to the idea such that former military president, Ibrahim Babangida, a man who perhaps is the biggest culprit that foisted this structure on Nigeria, has recently learnt his foxy voice to the call.

Given the ‘messianic’ garb that advocates have adorned the need for restructuring, and following the pressures that the demand is generating within an already fragile system, this opinion, using Atiku, Soludo and Tinubu as a metaphor for Nigeria, argues that what Nigeria’s current structure requires is a “tapering” and not the wholesale unbundling and re-coupling which advocates of restructuring are clamouring for. To foreground my argument, I will start by making a few clarifications on what constitutes restructuring and the various forms it could take. Next, the problems with restructuring in its purest form will be exposed and with empirical evidence, I will show that places where this pure form of restructuring has been adopted, it has been problematic and mostly failed. Following this, the Nigerian structure will be examined and recommendations on possible areas to taper will form the conclusion of the essay.

When a Nigerian politician calls for restructuring, he merely echoes the intellectual paradigm around decentralization. What then is decentralization? Without delving extensively into the historical contexts of the word and practice, it is important to state that the 19th-century anarchist, Pierre Joseph Proudhon first equated decentralization to the federation. Decentralization, therefore, will suggest an attempt to either move away from the centre or reduce the centrifugation it exacts over its components. The powers exacted over component units could be administrative, political and economic. Decentralization involves the devolution of some of the powers the centre wields over its component units. When the devolved power is in the political or administrative realm, the components of the whole attain some form of autonomous governance. The practice of decentralization in its purest economic sense according to Remy Prud’homme is “a system in which pure local governments raise pure local taxes and undertake pure local expenditures without the benefit of central government transfers”. This, perhaps, is the context within which most of the agitation for restructuring in Nigeria is anchored (the political contexts are also in question though the most vocal has been for the control of resources). Nigeria is one of less than four countries that have a three-tier constitutionally midwife federal structure i.e the central(federal), state and local government.

The introduction to this piece alluded to Soludo’s call for a “competitive” federal structure; though he did not elaborate, the intellectual argument for competitive decentralized local governments was canvassed by a scholar with the same first name as Soludo, Charles Tiebout in 1956. Tiebout assumed that the consumer voter(citizen) has preferences and will only move to a community that meets or guarantees those preferences. So, given that the expenditures and revenue of each municipal government are set and given the variation that exists between different municipalities, the consumer voter is attracted to areas that can most closely provide the preferences that he desires. The import of this is that municipalities are involved in a competition to attract the consumer voter to their locality.

The simple interpretation of Tiebout’s argument is reflected in Tinubu’s oft-touted

raison d’etre for “true federalism”-allowing the federating units to develop at their own pace. On the surface, in the light of current revenue challenges and expenditure shortfalls being experienced by many of the federating units, this type of structure will seem to favour only states endowed with huge deposits of exploitable extractive minerals with heavy taxable commercial presence. Perhaps, the opposition by elements within the ACF to restructuring/decentralization may be hinged on this fear given that many states in the North (many states in the South too fall within this category) are believed to be commercially unviable. But, if Tiebout’s assumptions for a competitive local governance system is infallibly true, then, even the units considered economically viable will be in trouble. How so?

Tiebout’s description of the consumer voter credits an unrealistic amount of rationality to him. When faced with conditions that are anathema to his preferences, he protests with his feet i.e he relocates to better areas. The reality on the ground in most states, not just the North is that of economic unviability occasioned by the absence of sufficient taxable economic infrastructures and opportunities. This situation creates disparities that are real. In an environment of competitive federalism, the consumer voter residing in municipalities with weak economic conditions will move to other municipalities that will meet his preferences. The massive movement of citizens to few locations that meet their preferences will put pressure on infrastructures in those municipalities leading to a collapse of social and economic conditions. This scenario is not just an exercise in intellectual rigmarole, it is already in play even with the present weak federal structure, a condition only mitigated by transfers from the centre to the weak units. To drive this point further home, let us take the example of four states, Lagos, Ebonyi, Ekiti and Yobe. Yobe, Ebonyi and Ekiti combined are more than 15 times the geographical size of Lagos, but their population size combined are 4 times lesser than Lagos’. Let us imagine a situation where Yobe, Ekiti and Ebonyi(and indeed many other states)are deprived of the transfers they get from the centre in an economically restructured Nigeria. Given the apparent lack of taxable and viable commercial ventures occasioned by the geographically induced economic disparities that exist between the units in focus and considering that Tiebout’s consumer voter protests with his feet when faced with unfavourable conditions, in no time, Lagos’ current population problem will be a child’s play. The current flooding of many parts of Lagos will suggest that Lagos may not survive such unrestrained population explosion.

Remaining with competitive federalism as envisaged by the proponents of restructuring, the Tiebout model presents another worrying economic disadvantage for units that currently assume that a decentralized economy will work to their strengths. The competitive model allows the federating units to provide facilities for the consumer voter and to tax the consumer appropriately. Herein lies its albatross. In a bid to attract commercial ventures and investments to their municipalities, favourable tax laws will be instituted by each unit, leading to what is known as a “race to the bottom”. This effectively renders the operating environment of many viable states unattractive and investors, who simply exploit such uncontrolled competition at the expense of revenue generation for the units. Of course, it may also be that the rich units could effectively lower their taxes to suit investors, thereby attracting many more commercial activities to themselves but with a potential loss of revenue, but the reality of the rational citizen voter relocating to these states with already highlighted problems remains, leaving the states with the option of taxing their citizens more to raise revenue (the very high tax regime in Lagos again comes to mind).

Restructuring as canvassed by its proponents is even more destructive to the national economy than its advocates may have envisaged. The purest form of fiscal federalism concentrates economic power in the hands of subnational federating units. The transfer of revenue is reversed such that a predetermined percentage, usually very small, is moved from the units to the centre. One of the core economic responsibilities of central governments is to institute macroeconomic stability within the country. Macroeconomic policies such as fiscal and monetary policies are very powerful tools in the hands of any government to trigger demand. The inadequacy of the control of such tools in the hands of smaller units is all too obvious. The units’ reach is not global and therefore, even when they attempt to implement fiscal policies for their municipality, they will only be incurring costs for activities that are outside their purview. Again, when federating units run amok driving fiscal policies in their states, and given how easily politicians can selfishly resort to manipulating such tools especially during election periods, there is always a tendency to engage in reckless expenditures, what Perloff referred to as “fiscal Perversity”. When the central government does not have full control of fiscal policy, the economic cohesion and stability of that country are undermined.

Argentina in the 80s, a country that has always been decentralized presents ample empirical evidence for this argument. The federating units indulged in reckless expenditures without restraint and before long had incurred huge deficits prompting the centre to bailout these units through borrowing from the central bank (sounds too familiar, with states in Nigeria requiring similar bailouts). The fiscal abuse and lack of discipline which characterized that period were lampooned by the World Bank(interestingly, one of the main proponents of decentralization for Third World countries) in its 1990 country report when it said that “[t]hese provincial/national financial practices have contributed to unsustainable public sector fiscal and quasi-fiscal deficits, and their continuation would undermine national efforts to attain price stability and to promote sustainable economic development.” Britain in the early 80s also faced similar problems when the municipal governments were frustrating the attempts of the centre to curtail public expenditures. The attempt to rein them in led to the institution of the disastrous poll tax.

To effectively discharge the responsibility of managing a country’s macroeconomic stability, the pool of resources available to the centre must be significantly larger than those available to the units. In 1988, Brazil, faced with growing calls to decentralize or restructure finally bowed to pressures and allowed the federating units to collect the bulk of taxes and to merely transfer a small percentage to the centre. Although the centre, in a bid to control fiscal policy regulated the percentage of taxes to be imposed by the states, its share of revenue was far below those of the units. Prudhomme argues that the current economic woes which Brazil is confronted with have its roots in that singular decision to curtail the powers of the centre to collect more revenues than the units since the centre could not effectively influence fiscal policies.

The most chilling example is that of Yugoslavia, described by Bogoev as one of the most decentralized states ever witnessed. With an infinitesimal revenue generation accruing to it from weak taxes, it had to rely on contributions from the units that are usually negotiated yearly. Unable to control and manipulate macroeconomic policy, inflation went out of the roof and the economy simply collapsed.

On the political front, devolution of power to federating units serves several functions, many of which evidence shows are effective. University of Birmingham’s Scholars, Nick Devas and Simon Delay poignantly assert that the Central and Eastern European countries that emerged from the rubbles of the breakup of the Soviet Union could have further fragmented if not for the decentralization of administrative and political responsibilities and powers to smaller units within these states. The clamour for decentralization within those states is not farfetched. For many years, these states, under the so-called iron curtain, were subjected to the high-handedness of Soviet centralization. In developing countries, especially with the peculiar ethnic nationalities agitations by different separatist groups, decentralization of power devolution is an important instrument in engendering trust and national cohesion.

Within the political and administrative needs for decentralization, a case is made for the capacity of such practice to bring government and governance closer to the people while also ensuring citizen participation and engagement in governance. It is argued that when citizens are engaged in governance, political actors become more accountable to the electorate. A sound argument, but let us look at it in practice. The size of many states and local governments in Nigeria, some of which are bigger than many small countries, makes it practically impossible for all citizens within a federating unit to participate in political socialization. It can even be argued that the effects of governance at the centre are felt more than those at the local federating units, particularly local governments.

The reason for the above is not too far-fetched. In the distribution of economic opportunities, goods and services, many subnational leaders are known to be parochially partisan. A story is told of how a state governor in the South-East favours mainly communities that voted for him in the elections that brought him to power. Of course, many will ask if president Buhari’s ‘5% moment’ does not reflect such parochialism. I agree, but the difference with the centre is that there are institutional safeguards that prevent such wanton nepotism. For instance, the national assembly has been known to use its power of the purse to redistribute projects across the federation. The creation of the federal character component in the constitution also helps in reducing significantly, attempts to punish a section of the country arbitrarily. I concede that even with this institutional safeguard, there remain structural issues to be addressed in the present setup.

The increase in the number of separatist agitations is a pointer to the fact that all is not well with the present structure. This is an area where decentralization has been known to be effective in addressing and quelling such movements. From Uganda to Rwanda, Liberia to Sierra Leone and even South Africa, countries that emerged from violent conflagrations and whose unity and corporate existence teetered on the brink, power was devolved to accommodate the quest for self-determination of the various groups. Even when a dominant or majority group had seized power, an acquiescence to the demands of autonomy by the minority group was what guaranteed lasting peace in these countries. However, the devolution of power to federating units is not a guarantee that there will not be counter-accusations of marginalization within the units. South-Sudan is on the brink of all-out war, less than five years after becoming the world’s newest nation. In virtually every state in Nigeria, even within those with ethnic homogeneity, cries of marginalization are rife such that most states now have some form of unwritten power rotation formula.

But this is not the basis for rejection of restructuring as presently canvassed. The glaring reality is that administratively, many units lack expertise and capacity in many key areas. As globalization takes firm roots in developing countries, with Nigeria in focus, many novel administrative challenges are thrown up. How do you deal with the consequences of climate change for instance? As rich as Lagos is, can it handle on its own the effects of the mass flooding of the entire state without federal assistance? How can that happen when a structure that cripples the capacity of the centre to intervene is put in place?

What about the war against corruption? With pure federalism as presently canvassed, the administration of criminal justice shifts to the states. The EFCC, ICPC and all other anti-corruption agencies may not have the jurisdiction to intervene in the financial affairs of the states. Your guess is as good as mine as to what this scenario will portend. Policing? The call again is for this to be left to the states. If this was not Nigeria we are talking about, I would have no hesitation asking us to bring it on. First, many of the governors that today clamour for state-run police can barely pay the salaries of their current workforce. With the rough estimate that about ten thousand policemen (and women of course) are needed to effectively police a state, how will the states fund this? Given the way governors of the South-East abused militia groups between 1999-2003 (recall the dreaded Bakassi Boys and the brutal murder of the Anambra State chairman of the NBA and his wife), I shudder at the thought of these class of ruling elites in the state being in legitimate and unquestionable control of a very important instrument of coercion. Imagine if a Fayose who asked his people to take laws into their hands in dealing with herdsmen, or an El’Rufai who said that an injury done to a Fulani is a debt that must be repaid, were to have legitimate access to weapons of destructions, with the foot soldiers to operate them! Another sad comparison is how these governors have turned their state houses of assembly to a gavel, stamping with impunity illegal decisions taken by them. Yet, I agree that the current security structure in the country is unwieldy and needs to be tapered but not by creating a legitimate guerrilla army for state governors.

This brings me to my analysis of the current structure and why I recommend tapering rather than an unbundling and recoupling of the present structure. Tapering is a lexicon which was applied by economists to describe the gradual reduction of actions implemented by the Federal Reserve and other Central Banks around the World to drag the global economy out of the 2008 recession (scaling back quantitative easing-future articles will deal with this in detail). To understand tapering, consider this: you give your tailor measurements for an outfit and on the day of collection, you discover that the tail is a little bit longer than the actual measurement. Certainly, you don’t cut the clothing materials into bits and pieces and start another round of stitches! An experienced tailor carefully nips the edges, cuts off excess materials and adjusts the design to fit your frame.

That the current federal structure is a behemoth is not in doubt. The constitution creates an exclusive, concurrent and residual list wherefrom the federating components draw their existence, powers and jurisdictions. The exclusive list is the sole inheritance or jurisdiction of the central government. The renowned Emeritus Professor of Political Science, John Ayoade identifies 116 areas of possible interventions by the federal government. He arrives at this number by adding up jurisdictions exclusive with those in the concurrent list since the constitution allows the federal government to ‘interfere’ as it were with the latter when it deems fit and proper. The residual list is a no-go area for the centre. A cursory study of the 116 areas of intervention by the centre will expose a disingenuous attempt at power-grabbing. This power-grab sailed through in 1998 due to the distraction caused by the enthusiasm for a return to civilian rule. Those who should question this anomaly simply wanted the military to go at whatever cost without taking time to robustly engage the military on the guiding document that will serve as the bedrock of the new dispensation.

Ranging from granting of Radio and TV licenses, control over interstate water sources, patents, tourism, libraries, public holidays, telephones, you name it and it’s probably there in the list, the centre was bogged down with trivial issues that it ought not to be involved with. Many items on the exclusive list are perhaps administrative issues that most states and local governments can effectively and efficiently handle. There is certainly no need for a melodrama about this. A simple constitutional amendment should taper and resolve this conclusively. These activities should be immediately returned to the states. I think that there is a consensus on that. The nutty issue is with resources and revenue generation.

Drawing from my earlier position that whatever arrangement is put in place, the centre must command more resources than the units, enough to be able to manipulate macroeconomic policies and to redistribute to other disparate regions. Not for the sustenance of what some call “spoon-feeding federalism” but to save the richer units from the effect of unwholesome competition. The current revenue sharing formula is unfair as it is capable of catalysing self-determination agitations (already happening).

Do we then need to call the existence of the country into question just to accommodate the entrenchment of equity in the distribution of wealth? Professor Wole Soyinka’s engaging and insightful case for Nigeria’s unity in the latest edition of the Economist magazine makes for an interesting read and is a weighty answer to the poser. However, the conversation about how revenues generated from each unit can be shared to address resource ownership concerns and yet leave enough to the centre to ensure that the State remains economically viable has been had at the last national conference. If the present administration can get off its high horse and revisit the recommendations, perhaps, the mounting cry for a total restructuring of the Nigerian federation will taper off. The loudest voices around make it seem like the Nigerian federal structure is a load of crap.

On the contrary, once the rough edges are tapered off and a commitment to the implementation of the spirit and letters of the constitution is made, the brilliance of the structure is all too glaring to see. My big brother Kennedy Emetulu in his reaction to The Nation’s Tatalo Alamu’s column on restructuring accurately asserted that no two decentralization structures are the same. Yes, but some recurring trends are found in virtually all of them. To be clear, according to the World Bank, between the 80s and now, almost every nation on the surface of the earth has decentralized in one form or the other. A common trend is an attempt at the synergy between the centre and the federating units. This synergy is usually a cooperative one, which is the brilliant intendment of the framers of the constitution in having a concurrent list. Continuous collaborations and possible areas for such need not be a basis for the gathering of ethnic nationalities and other actors to dismantle the pillars of our federation. Sometimes, actors within the system simply take bold steps to do the needful. The University of Ibadan’s erudite Professor of Political Science, Adigun Agbaje((my mentor, he most likely will disagree with my thought train), related how the South African elections of 1994 were spared by the bold actions of a few military officers. These gentlemen could have waited for formal directives to take necessary actions and would be right if they did that, but before such approvals would be granted, irreparable damage would have been done.

Decentralization confers full autonomy of governance to subnational units but this may not be entirely in the interest of the states. For one, the centre has more expertise, competencies and capacities in many areas which may be lacking in the units. A strong collaborative interface between the centre and the units will ensure that necessary infrastructures are delivered to the people. This was the case in Morocco where water and sewage treatment services were left for the units. Sanitary conditions failed because of the lack of capacity of the units to properly treat water and manage the versed plants. A compromise was reached and the centre brought its experience to bear, the World bank in a report noted the success of the intervention and welcomed such collaborations. This could not have been possible in a pure federal structure, a configuration that abhors interferences. A strong area of collaboration will be to develop and harness the extractive minerals of every unit. That every part of Nigeria is richly endowed is not a myth. But can these units on their own be able to deploy the massive investments that will be required to develop such potentials? I doubt it.

Interestingly, the states have shown weak capacity even in jurisdictions that are clearly under their sole purview. The conduct of local government elections is the sole responsibility of State Independent Electoral Commissions(SIECs). Not only are the elections conducted by the states a total mockery of democratic ethos, but it is also on record that these SIECs, contrary to the intendment of the constitution, still run to the INEC for institutional and logistical support. I am aware that the Professor Mahmood Yakubu led INEC has provided strong support to enable the SIECs to carry out their mandates, support that includes the provision of operational vehicles, ballot boxes and other non-sensitive electoral materials. Even at that, when these sham elections take place, they are a mere rubber stamp to validate the selection of loyalists of the governors as chairmen of local councils. The Kaduna state governor, Malam El’Rufai is being touted as preparing to conduct elections in local councils in the state using electronic voting machines. As at the time of this piece, no evidence is available to suggest that the KADSIEC has the technical expertise to go ahead with that ambitious project nor has the government shown that the over ten thousand electronic voting machines needed for the elections have been procured.

Conclusively, I see nothing wrong in a continuous healthy dialogue between critical stakeholders on the future of this country. The country’s survival is not just underscored by its corporate existence but also by its socio-economic wellbeing. In my humble opinion, there exist routes to structure Nigeria using existing institutions that will not create undue ethnic tensions. I recall the schisms that are always generated whenever a list of those to represent various interest groups during any of the past national conferences are being drawn up. In today’s Nigeria, this is a distraction that should be avoided. There is no topic concerning the existence of Nigeria that has not been adequately and comprehensively discussed in past conferences. The onus is on the leadership and indeed the ruling elite to develop the political will to implement them. In fact, it is in the enlightened self-interest of the elite that they do this and as soon as possible, for the gathering cloud might not be kind to them if they ignore it.