Fiscal federalism and resource control in nigeria ngozi nwogwugwu, phd. Fiscal federalism in nigeria an analysis of issues and. Federalism and political restructuring in nigeria download. Fiscal federalism and resource control in nigeria doi. Given the territorially delineated cleavages abounding in nigeria and the historical legacy of divisions among ethnic groups, regions, and sections, the federal imperative was so fundamental that even military governmentscharacteristically unitarian, hierarchical, and centralistattached importance to the continuation of a federal system of government. Theory and dimensions abstractthe dynamism and complexity of nigeria s federalism has attracted academic scrutiny. Federal countries differ a great deal in their choices specifically, how the division of fiscal powers is allocated among various orders and the associated fiscal arrangements. This book uses the political economy approach to examine the relative failure of federalism in nigeria. It is intended to identify new ideas for fiscal federalism with less conflict in nigerias 3rd republic. Nigeria can be said to be operating the federal system of government, whereas in actual practice, the country is tending towards a unitary system. Nigeria is a federation consisting of states and federal capital territory, federal. Download pdf re inventing federalism in nigeria free online. Fiscal federalism and economic growth process in nigeria. Fiscal federalism, local government, autonomy, finance 1.
A former governor of akwa ibom, chief victor attah, says the practice of fiscal federalism is the panacea to the myriad of problems plaguing nigeria. The clamour for the adoption of true fiscal federalism in nigeria has been a burning issue in several quarters in the last three decades and has been documented in several articles, amongst which is the empirical study of arowolo 2011. Continuing quest for stability and nationbuilding explores the nature of and the debate over a number of recurrent issues, such as the origins of nigerian federalism, the number of state units in the federal system, fiscal issues, political parties, distributional issues, and intergovernmental relations in nigerian federalism since the establishment of. Thus, one also may find a definition according to which federalism in its broadest sense marks a multilayer or pluralistic concept of social and political life. The fiscal relationships between and among the constituents. The paper therefore concluded that the federal government ought. See below for the abstract, table of contents, list of figures, list of tables, list of appendices, list of abbreviations and chapter one.
The calls or demands for resource control clearly demonstrate that this is still an unsettled issue. An examination of relevant issues in nigerias fiscal federalism international journal of research in humanities and social studies vol 2 issue 3 march 2015 3 political units because benefit regions for many public goods and services are open entities. Obong victor attah has again said that, unless nigeria adopts the true fiscal federalism system, the country would continue to wallow in its current. The ordinary least square ols technique is adopted. Fiscal federalism is concerned with the public finances of the various orders of government in a federal system. Taxation, revenue allocation and fiscal federalism in nieria. Indeed it was one positive aspect of the practice of federalism in nigeria. A brief tour through the history of nigerian federalism reveals sharp turning points in federal and regional fiscal relations, based alternately on principles of derivation, national interest, and the centripetal forces of military governments3. That is, it is manifest by the financial aspects of the devolvement of authority from the national to the regional and local levels. Fiscal federalism and challenges of development in nigeria. The practice of fiscal federalism in nigeria has been inhibited by several factors which include, the dominance of the federal government in the revenue sharing, the protracted period of. It involves the financial relationship among the three tiers of government. Pdf taxation, revenue allocation and fiscal federalism. In spite of this confusion, we can still conceptualize federalism.
The practice of fiscal federalism in nigeria has been inhibited by several factors which include, the dominance of the federal government in the revenue sharing, the protracted period of interregnum rule of the military, and overreliance on the revenue from the federation account. Fiscal federalism and economic growth process in nigeria owolabi usman,phd department of economics, osun state university, osogbo, nigeria. The methods attempted to unveil the various revenue principles such as the principle of derivation, equality of states and demographic strength in. Given the territorially delineated cleavages abounding in nigeria and the historical legacy of divisions among ethnic groups, regions, and sections, the federal imperative was so fundamental that even military governmentscharacteristically unitarian, hierarchical, and centralistattached importance to the continuation of a federal system of. Federalism is a political concept in which power to govern is shared between national, and subnational governments creating what is often called a federation arowolo. Fiscal federalism and local government finance in nigeria. Fiscal federalism is characterized by fiscal relations between central and lower levels of government. Social science the political economy of federalism in nigeria. Mar 29, 2017 a former governor of akwa ibom, chief victor attah, says the practice of fiscal federalism is the panacea to the myriad of problems plaguing nigeria. However, be that as it may, to daniel 2007, it means several varieties of political arrangement in nigeria to which the term federalism has properly been applied. Fiscal federalism, governance and internally generated. Fiscal federalism and issues of resource control in nigeria nenyiaba, c. The fiscal arrangement among the different tiers of government in a federal structure is often referred to as fiscal federalism.
The political economy of federalism in nigeria dele. Fiscal federalism is the fiscal relations and transaction between the three levels of government. Nations are turning to devolution to improve the performance of their public sectors. Fiscal federalism and issues of resource control in nigeria. Therefore, the problem with federalism in nigeria is the mixapplication or nonapplication of this clause especially as it has to do with power distribution awa, 1977. Fiscal federalism in the nigerian context involves the allocation of expenditure and taxation powers shared among the federal, state and local governments. The practice of fiscal federalism in nigeria has been inhibited by several factors which include, the dominance of the federal government in the revenue sharing. Fiscal federalism is characterised by the fiscal relations between central and lower levels of government. Nigeria operates a federal system with three tiers federal, state, and local governments table 1. Fiscal federalism in nigeria in any federal system, there must be an arrangement on how the revenue of the state will be shared among the component parts. Conceptual issues fiscal federalism is a byproduct of federalism. Fiscal federalism, governance and internally generated revenue. The issue of fiscal federalism has engaged various commissions and committees since the colonial days. Fiscal federalism in nigeria the question of an acceptable formula for revenue sharing among the component tiers of the nigerian nation is one of the most protracted and controversial debates in the political and macroeconomic management of the economy.
Fiscal federalism is essentially about the allocation of government resourc. Federalism can be seen as a system of government in which governmental powers that exist in a country are shared between central government and other component units i. It dates back to 1946, when the richards constitution was introduced. The term federalism is derived from the latin word fidere meaning to trust or to entrust some agreed values to a central entity of a given country 5. This is not unexpected as the federal government is solely responsible for the collection of mining rights and royalties, petroleum profit tax nigerias major. Current structure of fiscal federalism in nigeriaa legacy of military rule 4. Download the complete political science project topic and material chapter 15 titled fiscal federalism in nigeria a case study of olusegun obasanjos regime 1999 to 2007 here on projects. In fact, fiscal federalism is a general normative framework for assignment of functions to the different levels of government and appropriate fiscal instruments for carrying out these functions oates, 1999. Before we start discussing federalism in nigeria, it is pertinent to know what federalism really is. Pdf a comparative study of fiscal federalism in nigeria.
As a subfield of public economics, fiscal federalism is concerned with understanding which functions and instruments are best centralized and which are best placed in the sphere of decentralized levels of government oates, 1999. An examination of relevant issues in nigerias fiscal. Download pdf re inventing federalism in nigeria free. This book takes nigeria as a case study for examining how the various issues involved in fiscal federalism in a developing country are handled. Fiscal federalism in the nigerian context involves the allocation of. Issues of distribution of scarce but allocatable resources have often beclouded the desires of nigerians to generate the resources that are expected to be shared. E 2 1 department of public administration, federal polytechnic kauranamoda, zamfara state nigeria email. Taxation, revenue allocation and fiscal federalism in nigeria. Yet, even today, this issue continues to be in the front burner of national discourse.
Pdf taxation, revenue allocation and fiscal federalism in. Federal countries differ a great deal in their choices specifically, how the division of fiscal powers is allocated among various orders and the. Comparative perspectives from canadian fiscal federalism olumide victor ekanade 0 1 2 recommended citation 0 redeemers university, ogun state nigeria 1 commons, other international and area studies commons, and the political economy commons 2 part of the african studies commons, comparative politics commons. Fiscal federalism, local government, autonomy, finance. Federalism is a means of ensuring peace, stability and mutual accommodation in countries that have territorially concentrated differences of identity, ethnicity, religion or language. The evolution, development and practice of federalism in. Taxation, revenue allocation, and fiscal federalism in nigeria 31 total nigerian government revenues were collected by the federal government. This gave rise to the thinking that federalism is a process of formation of a particular kind of political union, with at least two autonomous but interdependent levels of governments 6, that form of government where.
In other words, it is the study of how competencies expenditure side and fiscal instruments revenue side are allocated across. Fiscal federalism and economic development in nigeria. Herber, 1979, looked at fiscal federalism as the division of fiscal powers between sovereign levels of government in a federation. The concept of fiscal federalism is not to be associated with fiscal decentralization in officially declared federations only. The findings of this study indicate that the allocation formulae were not strictly adhered to by the federal government. Fiscal federalism in nigeria an analysis of issues and challenges. Akindele and olaopa2002 held that fiscal federalism was deeply rooted in the federal system of government. This study therefore attempts to empirically assess the state of nigeria s fiscal federalism in terms of its impact on. Download pdf thepoliticaleconomyoffederalisminnigeria.
It is a system which refers to the existence in a country of more than one level of government, each. Since nigerias transition from military to civilian rule in 1999, the countrys supreme court has risen from a position of relative political obscurity and institutional vulnerability into a prominent and independent adjudicator of intergovernmental disputes in this chronically conflicted federation. Specifically, the nigerian fiscal federalism structure involves the allocation of expenditure and taxraising powers among the federal, state and local governments. Federalism, especially in large or diverse countries, can also improve service delivery and democratic resilience, ensure decisions are made at. Faculty of management sciences, nnamdi azikiwe university, awka, anambra state, nigeria. Kupoluyi department of political science and public administration babcock university,ilishanremo, ogun state abstract. Gdp, inflation and exchange rate in nigeria between 1970 and 2010. Debates on nigerias fiscal federalism preceded the gradual evolution of nigeria into a colonial federal state in 1954. Fiscal federalism true solution to nigerias problems. For the use of the term fiscal federalism as applied to scotland, see full fiscal autonomy for scotland. It shows the nexus between the political and the economic aspects of the countrys federalism. For instance, federalism is a form of governmental and institutional structure designed to cope with the dual but equally difficult task of maintaining unity while preserving its diversity. Our central argument is that nigerias fiscal federalism has not spurred the desired development as envisaged by the architects of the system. Fiscal federalism has occupied the front burner of political discourse in nigeria, since the return to civilian rule.
Issues, challenges and policy options article pdf available in ekonomski anali 56189. Theory and dimensions dare arowolo lecturer, department of political science and public administration, adekunle ajasin university, nigeria abstract the dynamism and complexity of nigeria s federalism has attracted academic scrutiny. The politics of revenue allocation and resource control have been a dingdung affair for a very long time in nigeria. Fiscal discipline and service delivery in nigeria festus o. An overview of core issues by kayode oladele according to professor akpan ekpo, a onetime vice chancellor of university of uyo, during his 2004. Fiscal federalism true solution to nigerias problems attah. Taxation, revenue allocation and fiscal federalism in. It is intended to identify new ideas for fiscal federalism with less conflict in nigeria s 3rd republic.
The centralization of nigerias fiscal federalism began with the report of the dina commission 1968 which argued that an appropriate revenue allocation system should result in a more equitable distribution of revenue among the states to achieve a. Mar 29, 2017 former governor of akwa ibom state, arc. The feature of nigerian federalism could only be better understood by a reproduction of the definition of the concept federalism, professor nwabueze in his definition, defined federalism as an arrangement whereby governmental powers within a country are shared between a national, country wide government and a number of regional governments. Ekpo and enamidem ubokudom eds, issues in fiscal federalism and revenue allocation in nigeria, ibadan. The fiscal relationships between and among the constituents of the federation is explained in. Federalism can be seen as a system of government in which governmental powers that exist in a country are shared between central government. This paper, therefore, inquired into the causes of dissatisfaction and violent agitation arising from fiscal federa. Nigeria to which the term federalism has properly been applied.
Current structure of fiscal federalism in nigeria a legacy of military rule 4. Conceptually, fiscal operations of any economy can be viewed from two extreme forms. This is because it has generated so many problems capable of threatening the corporate existence and continuity of the nigerian state. The country having experienced fiscal federalism for over 50 years is still beset with problems. Conceptual explanation it has been discussed and agreed at many fora that the discussion of contemporary federalism seems to have started with kenneth c. Fiscal federalism, which mirrors the amount of fiscal autonomy and responsibility accorded to subnational government, has been an important subject in the policy equation of many developing, transition, and developed countries this paper, therefore, examined the evolution, structure, and practices of fiscal federalism in nigeria. Pdf the paper posits that fiscal federalism is a particular pattern of constitutional division of revenue powers and responsibilities among. Fiscal federalism and local government finance in nigeria eric. The future of fiscal federalism download ebook pdf, epub.