Fiscal federalism: Jonathan’s endless battle with govs

[SunNews]

FROM TAIWO AMODU, ABUJA

As President Goodluck Jonathan sustains his battle for the control of the soul of the Peoples' Democratic Party (PDP), ahead of 2015 general elections, against the onslaught of certain governors of his party tagged, the G-7, the opposition governors are also smarting for a showdown with the beleaguered president.

The unfolding battle this time has nothing to do with the 2015 presidency but what the governors claim to be the Presidency constant assault on the Nigerian Constitution: its unilateral withdrawal from the Federation Account without recourse to states.

At a meeting of the governors of the All Progressive Congress (APC) controlled states on October 22, at the Ekiti State Governor's Lodge, the governors operating under the aegis, the Progressives Governors' Forum, restated their aversion to what they called the unconstitutional deduction which they claimed led to about 40 per cent loss in their revenue earned from Federation Account in the last few months.

The host governor, Dr Kayode Fayemi, submitted that there was no basis for incomplete allocation to states from the Federation Account by the Federal Government.

His remarks summed up the depth of the frustrations of the 11 APC states with the management of the Federation Account:

"We discussed issues that are pertinent to national finance, particularly the Federation Account Allocation Committee (FAAC), work. We have come to a critical junction as far as FAAC discussions have gone over the last three months. You aren't unaware of what has been going on, you are also aware of what our finance commissioners have had to do in removing themselves from the meetings of FAAC and we continue to insist that we condemn the illegal and unconstitutional deductions. Averagely, all our states lost 40 per cent of our normal earnings in the last two to three months from the FAAC and we believe this isn't defensible in any way.

"We know that the bench mark that the National Assembly agreed for 2013 Budget is still very, very realistic because at no time throughout this year, has oil sold for anything less than $105 per barrel. In fact, more often than not, oil sold for $110 per barrel. So, there is still no basis for the kind of incomplete allocations to the states in this regard. We have decided to take appropriate constitutional measures to tackle this flagrant abuse of the Constitution of Nigeria and the Appropriation Act, particularly of the National Assembly."

Members of the PGF, are Kashim Shettima (Borno), Adams Oshiomhole (Edo), Kayode Fayemi (Ekiti), Rochas Okorocha (Imo), Raji Fashola (Lagos) and Tanko Almakura (Nasarawa). Others are Ibikunle Amosun (Ogun), Rauf Aregbesola (Osun), Abiola Ajimobi (Oyo), Ibrahim Geidam (Yobe) and Abubakar Yari (Zamfara).

Before their last meeting and the threat to institute litigation against the Federal Government to redress what they insist is a breach of the constitution, the governors had also faulted the NNPC claim on the proceeds from crude oil sales to the Federation Account from January this year and further challenged the corporation to tell Nigerians all revenues collected by it and how much was paid into the Federation Account, from 1999 till date.

Reacting to a statement credited to the Acting Group General Manager, Group Public Affairs Division of NNPC, Ms. Tumini Green that not all revenues collected by NNPC are paid directly into the accounts of Federal Allocation with the CBN, and her claim that "some are paid into the accounts of the relevant government agencies, like the Federal Inland Revenue Services and the Department of Petroleum Resources with the CBN," the PGF described her submission as "escapist, dishonest, contradictory and in many respect fraudulent."

The governors noted that the NNPC action of lodging oil proceeds into separate accounts was a contravention of Section 162(1) of the 1999 Constitution, which, states: "The federation shall maintain a special account to be called the Federation Account into which shall be paid all revenues collected by the Government of the Federation, except the proceeds from the personal income tax of the personnel of the armed forces of the federation, the Nigeria Police Force, the ministry or department of government charged with responsibility for foreign affairs and the residents of the Federal Capital Territory, Abuja."

Jonathan: The past haunts

Daily Sun checks revealed that before the recent belligerence of the APC controlled states, the 36 state governors across political divide had frowned at similar deductions in the past under the present administration. While consultations failed, the governors operating under the platform, the Nigeria Governors' Forum (NGF), instituted a suit at the Supreme Court to challenge the action of the Federal Government before their camp was infiltrated by the Presidency and they were eventually polarized into factions.

Before their last controversial election, where 19 governors voted for Rivers State governor Rotimi Amaechi as against 16 that voted for his Plateau State counterpart, Jonah Jang, the governors at their meeting on January 28, unanimously resolved to take no further adjournments in their case before the apex court, challenging deduction from the Federation Account without recourse to states which they viewed as an affront on fiscal federalism.

Amaechi read their resolution: "We, the governors of the 36 states of the Federal Republic of Nigeria at our first meeting today, deliberated over a number of issues and resolved as follows: "Forum decries the present attitude of the Federal Government on the Excess Crude Account and resolved to take no further adjournments in the subsisting case in court but seek a final resolution of the matter from the Supreme Court."

Further checks revealed that it was the last unanimous resolution of the forum, as the Presidency took the initiative to break their ranks by creating the PDP Governors Forum inFebruary and installing the Akwa-Ibom State Governor Godswill Akpabio as chairman, ahead of the controversial election of the larger platform in May.

Akpabio in his inaugural remarks made allusion to the litigation instituted by the NGF led by Amaechi as he claimed that the forum of 36 states governors was being turned into a trade union:

"We will not allow minorities to impose their ideas on us the majority. We will not allow NGF to be seen as a trade union to fight government. We cannot be fighting the Federal Government, we are part of the Federal Government. Our job is to work with the Federal Government to initiate best policies for the interest of Nigerians."

NGF unrepentant

In spite of the onslaught against it, recent development has shown that Amaechi led faction of the NGF, appears not deterred in its crusade for restoration of normative fiscal federalism.

At the September 18 meeting of the forum, the governors demanded the resignation of the Finance Minister, Professor Ngozi Okonjo-Iweala, over non compliance with the revenue projections of the 2013 Budget of which they noted was a direct breach of the provisions of the Appropriation Act, 2013:

"Forum observed that the National Economic Council, (NEC) is constitutionally responsible for the management of the economy and should be used for that purpose as opposed to the Economic Management Team constituted by the Presidency."

The Amaechi-led NGF reiterated its "earlier call to the National Assembly for the separation of the Office of the Accountant General of the Federation from that of the Accountant General of the Federal Government for accountability and better management of the economy."

Who blinks?

While the Presidency has not officially reacted to the outbursts of the APC governors and their threat to challenge it in court over management of Federation Account, Nigerians are watching to see how the impasse would be resolved by the contending forces.

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