3 months ago
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Amid rising discontent and allocation discrepancies, ’LAOLU AFOLABI explores the growing rift between the federal and state governments over unmet promises and the disconnect between funds and actual improvements in living standards
On Sunday, August 4, President Bola Tinubu addressed Nigerians in response to the escalating violence during the #Endbadgovernance protests, which began on August 1. The protest was a result of a disconnection between the government and the governed. Despite the claim of inflow of unprecedented allocations, Nigerians feel both the national and sub-national governments are failing to deliver on their core responsibilities. The impact of the improved allocations on the lives of ordinary citizens remains minimal.
In some states, infrastructure projects are stalled, public services are deteriorating, and economic development lagging. Instead of channeling these significant resources into critical areas like healthcare, education, and infrastructure, some governors seem more focused on political posturing and maintaining their grip on power. The result is a growing disconnect between the funds allocated to the states and the tangible benefits that should be felt by the people.
An examination of the allocations to states across the federation over the past year reveals a significant increase in revenue. However, state officials argue that despite this boost, the impact of inflation has eroded the real value of these funds, diminishing their purchasing power.
The recent protests, sparked by economic hardship and widespread discontent, highlighted the urgent need for effective governance at the state level. Unfortunately, instead of seeing improvements, citizens are facing rising costs of living, poor infrastructure, and inadequate public services. The high revenue inflows should be catalysing growth and development, yet the reality on the ground tells a different story.
By August 3, the protests had turned violent, leading to widespread looting, destruction, and casualties, particularly in the North. With tensions rising, many, including the opposition leaders, called on the President to address the nation. This speech, his seventh since taking office over a year ago, however, sparked controversy.
He spoke with a heavy heart and a sense of responsibility. He expressed pain over the loss of lives in Borno, Jigawa, Kano, Kaduna and other states, including the destruction of public facilities in states and the looting of supermarkets and shops. While calling for the suspension of the protest, he said he was set to reinvent the economy, which had remained anaemic and taken a dip because of many misalignments that had stunted the country’s growth. The President said he took the painful yet necessary decision to remove fuel subsidies and abolish multiple foreign exchange systems which had constituted a noose around the economic jugular of the country and impeded its economic development and progress.
“On the fiscal side, aggregate government revenues have more than doubled, hitting over N9.1tn in the first half of 2024 compared to the first half of 2023 due to our efforts at blocking leakages, introducing automation, and mobilising funding creatively without additional burden on the people. Productivity is gradually increasing in the non-oil sector, reaching new levels and taking advantage of the opportunities in the current economic ambience
“My dear brothers and sisters, we have come this far. Coming from a place where our country spent 97 per cent of all our revenue on debt service; we have been able to reduce that to 68 per cent in the last 13 months. We have also cleared legitimate outstanding foreign exchange obligations of about $5bn without any adverse impact on our programmes.
“This has given us more financial freedom and the room to spend more money on you, our citizens, to fund essential social services like education and healthcare. It has also led to our State, and Local Governments receiving the highest allocations ever in our country’s history from the Federation Account,” President Tinubu said.
Though the protest lost steam after the broadcast, the speech further inflamed tension, disappointing those who expected concessions, such as the reintroduction of the subsidy regime. The President made no concessions, instead, he urged the public to trust the process and highlighted the Federal Government’s efforts, including the launch of major infrastructure projects, recovery in the oil and gas industry, with increased oil production and renewed foreign investment.
To reduce reliance on imported petrol, the President announced a breakthrough in the Compressed Natural Gas initiative, aiming to cut transportation costs by 60 per cent. He discussed agricultural development initiatives to enhance food production and the Renewed Hope housing scheme. Additionally, he said the student loan scheme, consumer credit corporation and various youth empowerment programmes being implemented alongside securing $620m for digital and creative job creation would improve the lives of Nigerians.
The President’s reference to the over N570bn released to the 36 states to expand livelihood support to their citizens was off-the-mark, as some governors, who had hitherto lauded the President for his reforms, did not spare him a rod of rebuke. While the Bauchi State Governor, Bala Muhammed, said the President’s speech was empty, his Oyo State counterpart, Seyi Makinde, declared the N570bn claim “another case of misrepresentation of facts.”
The claim further strained the already tense relationship between the Federal Government and state governors, starting with their objection to the Supreme Court’s affirmation of Local Government autonomy. While the All Local Government of Nigeria stated that the Federation Allocation Account Committee had not yet made direct payments into local government accounts, a credible source informed The PUNCH that an agreement had been reached between the governors and the Attorney-General of the Federation and Minister of Justice for a three-month grace period to resolve issues with the Federal Ministry of Finance before full implementation.
Leading the attack against the President, Governor Muhammed, an admirer of a true federalist and an advocate of the rule of law in Tinubu, following the affirmation of his electoral victory by the Supreme Court, backtracked. The Chairman of the Peoples Democratic Party Governors’ Forum tagged the President’s broadcast an “empty statement,” claiming it worsened the hunger protest.
“I am not the President’s spokesman, but I certainly know that the speech is very empty. It is rather escalating the whole situation. He should have listened to us (governors) because we also listen to our local government chairmen. He speaks in a manner that does not show sympathy with the youth. We are with the protesters in Bauchi State, but, at the same time, we are not with them in terms of unleashing harm and destruction of lives and properties,” he said on August 5.
By August 7, at the unveiling of the campaign for local government election, Muhammed said there were a lot of problems in Bauchi State and claimed Tinubu was responsible for them. He added that the FG policies were not working, from the North to the South. He said it would be easy for the PDP to coast to victory in 2027, with a promise to invite the President to manage the party’s presidential campaign. During the inspection of the federal highway connecting Kano to Maiduguri, which was cut off by heavy downpour, he, however, appealed to the FG for urgent intervention to repair the damaged road, stressing the need to ease the transportation of goods and services for the benefit of the citizens
Makinde, in a newsletter, spoke on the query he got for the N570bn “hardship fund” given to the 36 states. He said the funds were part of the World Bank-assisted NG-CARES project, for results intervention. The Oyo State Governor said the World Bank facilitated the intervention to help states in Nigeria with COVID-19 Recovery.
“After the World Bank verified the amount spent by the state, it reimbursed the states through the platform provided at the federal level. The Federal Government did not give any state money; they were simply the conduit through which the reimbursements were made to states for money already spent.
“It is important to note that the World Bank fund is a loan to states, not a grant. So, states will need to repay this loan. Note also that NG-CARES, which we christened Oyo-CARES in our state, predates the present federal administration.
“So, in direct response to the message, the Federal Government did not give Oyo State any money. We were reimbursed funds (N5.98bn in the first instance and N822m in the second instance).
“We invested in the three result areas of NG-CARES, which includes inputs distribution to smallholder farmers within our state. When the World Bank saw our model for the distribution of inputs preceded by biometric capturing of beneficiary farmers, they adopted it as the NG-CARES model,” Makinde said.
Speaking on the N573bn fund the President claimed was raised for states, the Nasarawa State Governor, Abdullahi Sule, clarified in an interview with Channels Television that the World Bank loan received by states was for infrastructural projects and not to cushion the effects of hardship faced by Nigerians.
The governor confirmed Makinde’s statement that states received the money in batches with the latest received in June, stressing that it was a loan and not free funds.
“The money is tied to certain projects. It is almost like a regimented loan from the World Bank. The money is not for rice, it is not for palliatives, it is not for anything in that line.”
He, however, said revenues to states had improved under the Tinubu-led government, adding that the recent nationwide protests should serve as an eye-opener for governors to begin to “do something” especially those of the northern region.
“No state will say that their revenue has not actually increased, sometimes doubled. In the past, the total amount of revenue shared monthly was around N600bn to maybe about N620bn max, sometimes even slightly lower. Today, you see the total amount being shared, N1.1trn, N1.2trn and the rest of that.
“Every state, as well as the Federal Government, is receiving improved revenue, thanks to Mr President for allowing it to go like that because, he would have said, ‘No this is money meant for subsidy, therefore, we are going to take it and divert it somewhere,’ but they are sharing it so that every state will go and do other things, and every state is doing.
“This protest is an eye-opener, especially for my colleagues in the North. Even if anyone is not doing anything, this is the time to do something, because we can’t blame other people. I love the statement made by Shehu Sani (Senator) when he said to forget about the microscope and look at the mirror, and this is the time.
“For me, I can’t wait for next week or the week after, when we sit down as governors of Northern Nigeria, and tell each other the truth; we must do something. We have no reason not to do anything,” he said.
Another contentious issue is the palliative rice distributed to states by the Federal Government. Edo, Adamawa, Taraba and Abia states denied receiving 20 truckloads of rice from the Federal Government.
After the pressure from the opposition All Progressives Congress in Edo State and the looting of a store which the government claimed belonged to the Christian Association of Nigeria, the government affirmed receipt of some bags of rice, which it further claimed was inconsequential to a population of over seven million people.
The state Commissioner for Communication and Orientation, Chris Nehikhare, speaking last week on the controversies surrounding the rice distribution in the state, said though the government received some trucks of rice from the Federal Government early this year, it was a drop in the ocean.
“Twenty trucks of rice? We are close to seven million people in Edo State. How does that help? “On the issue of the Federal Government giving us rice, I will tell you, a few months ago, maybe early this year or late last year or mid-this year, they brought some few trucks of rice,” he said.
Denying receipt of the 20 trucks of rice, Abia State Commissioner for Information, Okey Kanu, said there was no communication from the Federal Government for any such palliative.
“We didn’t see any truck of rice from the Federal Government. And the issue of selling a 50kg bag of rice for N40,000 is fake news. We don’t deal with rumours and speculations. There has been a way the Federal Government communicates with us when it has to do with palliative, and no such message has come from the Federal Government,” he said.
The Senior Special Assistant to the President on Media, Temitope Ajayi, however, countered, asking the governors to spend the increased allocations they got from the Federal Government on the people, including their own internally generated revenue.
On the controversial N570bn, he said, “The Federal Government guaranteed the COVID-19 livelihood support loan from the World Bank under the NG-CARES programme and disbursed the loan to states. The Federal Government is not saying what is not true that it gave N570bn to states.
“Governor Makinde is being clever by half. We are not attacking the governors. We’re emphasising that both the Federal Government and sub-national entities must provide services and value to the citizens.
“Governors must do their part of the social contract. They were elected the same way Nigerians voted for President Tinubu. The governors must deliver impacts through provisions of social services in education, healthcare and critical infrastructure to improve the quality of life of the citizens.”
Following the positions of some of the northern governors and their attack on the Tinubu-led Federal Government, Vice President Kashim Shettima, at the weekend granted two major interviews with the British Broadcasting Corporation Hausa and the Voice of America, also in Hausa.
The Vice President, in the interviews, corroborated the claim by the Nasarawa State Governor that a high-level meeting of the northern stakeholders, which will include governors, politicians, business executives and traditional leaders, will take place within the next three weeks to discuss issues related to the region.
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