DEFORMITIES IN NIGERIA'S ALLOCATION FORMULA

Source: thewillnigeria.com

Writing on Greater Awgu Leadership Forum website Mr. SKC Ogbonnia is his effort to continue his war against the former President Jonathan's Administration wrote as below and ended by taunting Mazi Benjamin Aduba

Quote
The breakdown
An analysis of the receipts by geopolitical zones indicated that the oil-rich South-South got the highest revenue from the central coffer with N3,435,082,465,812.34, followed by the North-West region which got N1,589,955,159,981.08. South-West came third with N1,372,266,936,693.85, followed by the North-East which received N1,159,089,156,240.80. The North-Central and the South-East got the least allocations among the regions. North Central got N1,116, 758, 071, 909.96; while the South East kept the rear with N 957, 248, 784, 523.49.”

This figure was under President Goodluck EBELE AZIKIWE Jonathan. Given this breakdown, WHY did the Igbos vote for Jonathan and PDP again in 2015? So, who is zooming who?

And, where is Mazi Benjamin Aduba?
SKC Ogbonnia
Unquote
https://groups.yahoo.com/neo/groups/GreaterAwguLeadershipForum/conversations/messages/2468

Mazi Benjamin Obiajulu Aduba is here. The setup is well done and the idea is for me to say that the Igbo should not have voted for GEJ or to say that the allocation was justified. Those of you who have read the Bible would see a parallel in Luke 20:19-26 (KJV) where the Pharisees confronted Jesus with a setup. While my answer would not be nearly as clever as our Lord's I will try a similar approach.

The claimed allocation under GEJ was the same under all other governments before him and would not be different under PMB. The reason is a document called: Revenue Allocation Formulae in Nigeria (manuscript ID: RCMSS/IJPAMR/1304. This document prescribes how federal allocations would be applied to Nigerian states. Once this document was approved and the formulae loaded in the computer allocation server it became a mere computer exercise: garbage-in-garbage-out (GIGO). Ebeaa ka nmiri siri baa no opi ugbogiri (this is how water got into the pumpkin stalk) http://rcmss.com/2013/1ijpamr/Revenue%20Allocation%20Formulae%20in%20Nigeria_%20A%20Continuous%20Search.pdf

There are two allocation formulae used by the Federal Government. One is known as Vertical Allocation which is how revenue is shared between governments: Federal, State, and Local Government. Under Obasanjo and Jonathan it was and is:

Federal Government                    52.68%
State                                                  26.72%

LG                                                      20.60%

The other allocation is what is known as Horizontal allocation. It is here that SE was really screwed up badly. Not by the formula but by decisions made a long time ago to punish Biafra. Neither GEJ nor OBJ nor PMB would do anything to change it and I doubt that it will change without another Nigeria/Biafra war.

Here is the formulae:
Equality                                             40%

Population                                        30%

Landmass/Terrain                        10%
Internally Generated Fund          10%
Social Development Factor         10%
The Horizontal allocation is how the 26.72% of the Vertical allocation is distributed to the states

To understand how SE got almost nothing in the allocation one must go back to the Vertical Allocation. That formulae like that of Horizontal is developed to ensure that SE gets almost nothing. Local Government gets 20.60% but how many of those LG are in SE? We know that Sokoto has more LG's than SE combined, on that basis alone SE does not get much. There are at least six states in each zone or seven as in NW but SE has only five. The 26.72% allocated to the States leaves SE short changed also.

Except for the 40% allocated on the basis of Equality all other factors in Horizontal work against SE. Inflated population figures of all but SESS means that the 30% allocated on population basis misses SESS by a wide margin as does the 10% allocated on Landmass/Terrain. The total SE landmass would be a fraction of any state in NW or NE. So those state alone would get much more than the combine receipts of SE. Allocation by Social Development Factor is in reverse order the more developed a state is the less it gets. Social Development Factor includes Education (4.0) Health (3.0) Water (3.0) {Bashir 2008.7} SE is considered better educated has better Health care and less need for water. So SE is once more screwed and the North once more gets all the advantage.

One point to note is that SS would have been in exactly the same spot SE is but for the point of derivation principle which calls for 30% of oil revenue to be taken off the top and allocated to source of the oil. When and if oil dries up SS would be equally exposed.

The second point to note is not as strong as the first but has a little impact and that is who controls the FG. Apart from the Aguiyi Ironsi's 6-month leadership, no SE person has been in charge of FG. While GEJ is close enough, he was forever fighting for survival that bold decisions were beyond his grasp.

SE has no $1 billion investments as other parts of Nigeria. It does not even have $.5 billion investment.

The conclusions based on the above evidence are obvious. No matter how one looks at it SE is not benefitting from Nigeria. Vertical allocation hurts SE; Horizontal Allocation abuses SE. If you throw in the 20 pound policy of 1970 you wonder how come that SE still exists. And for some they begin to appreciate the sagacity of South Easterners, their ability to refuse to cry “uncle.”

But how long will this go on?
What are the policy implications from all these?

  1. The current battles for the soul of Nigeria especially by SE is misdirected. They are fighting the wrong battles and Nigerians must recognize that they have won the war and should stop fighting it; or the continued fighting could change and produce different results. The First World War mistakes should stand as a beacon warning of dangers lurking ahead. It was the extravagant exploitation of Germany that led to the Second World War that cost millions of lives of both the Allies and Axis Powers and destroyed most of Europe and Japan and is still affecting post WW II world.
  2. SE should refocus the guns in different areas, such as
  3. Ensuring that Nigeria conducts a real census that shows the true population of Nigeria by ethnic groups, religions, zones, and cities. GEJ tried to jump start it but was shut up in a hurry.
  4. Ensuring that the allocation formulae is revamped to do away with landmass/terrain. Money is allocated for the people not for land. But if landmass is important so are trees and shrubs.
  5. Ensuring that Internally Generated funds are developed to make up for lost revenues from a biased formulae
  6. Ensuring that other sources of revenues receive as much attention as oil. Such other revenues are solid minerals, agriculture, Palm oil, etc.
  7. Ensuring that the Federal Government allocation (52.62%) is used to develop all zones by making sure that the qualities of roads and bridges are equal and that industries and educational institutions are fairly allocated to all zones. There is no reason why Oji River Police College should not be upgraded to a university given that no military or police training facility is located in SESS. This should be something that SE delegation should pursue with vigor and something PMB government would find easy to accept.
  8. Ensuring accountability by all leaders in SESS. It can be said that even the small allocation received has not been used for the benefit of our citizens.

Mr. SKC Ogbonnia, did I answer your call?
Written by Benjamin Obiajulu Aduba.

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