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Oil Revenue Allocation: Why North may remain poor but richer as North East and North West gets much more than South East

Why North may remain poor
People & Politics Thursday, March 8, 2012

By Ochereome Nnanna

AND now, let us face the argument that there is rising violence in Northern Nigeria because of "low derivation" from oil resources.


The governors of Northern states capitalised on this preposterous assertion by the Governor of the Central Bank of Nigeria, Malam Lamido Sanusi, to call for more money from oil resources to enable them tackle the poverty to which the Boko Haram insurgency is now tied by the elite of the region.

Following this controversy, one Samuel Diminas wrote a well circulated rejoinder in which he isolated the revenue monthly shared to all states of the federation for the month of September 2011.

It showed that the total amount of money allocated to the Boko Haram hotbed, the North East Zone, totalled N43.76 billion. That of the South East Zone came to N35.67 billion, while that of the North West was a whopping N63.16 billion. Borno State received higher than Abia, an oil producing state of the South East. All the Boko Haram-plagued states of Borno, Yobe, Bauchi and Adamawa received higher than Ebonyi State, which got the lowest in the South East (N5.53 billion).

The primary reason the North East and North West got so much more than the South East was because when the North was in power, they allocated more states and local council areas to their home zones in order to grab as much of the oil resources of the Niger Delta as possible.

If it is true that "low derivation" is responsible for rising violence, why is it that South East is not the most violent zone in the country? Why is it that the South-South Zone, the owner of the oil wealth, is not the most peaceful since they collect the largest amount of allocation based on the 13 per cent derivation principle? The South East was the theatre of the Biafra - Nigeria war. It came out of that war with virtually everything lost.

Rather than repair the theatre of war, the Nigerian establishment led by the North chose to exclude the zone from the mainstream until recently when the war time anti-Igbo coalition started collapsing due mainly to the fact that the North took most of the spoils for itself. And yet, the South East is today at the top in terms of human development indices.

The poverty and rising violence in the North have nothing to do with oil-related derivation. Since the North does not produce oil and is not one of the littoral states it has no right under the Constitution to talk about derivation. It should limit its expectations to its share of the "commonwealth" that goes to states and local council areas every month.

There is a name given to someone who eyes what does not belong to him. It is the oil producing states that have the right to agitate for the restoration of the 1963-level derivation royalties which the North while in power selfishly cancelled in its blind quest for the oil wealth of the Niger Delta.

The perennial poverty and violence in the North are self-inflicted. It is rooted in the system referred to in the South as "the Northern oligarchy". Boko Haram is rebelling against the Northern oligarchy which does not promote social mobility.

It creates two classes (a) permanently super-rich and privileged small circle of aristocrats and (b) the impoverished, destitute and hopelessly downtrodden masses, the so-called talakawa. It was for the masses that the great Malam Aminu Kano evolved his ideology of social humanism to fight the oligarchy. He was eventually overpowered and the masses lost.

Boko Haram is a misguided rise of the underclass against the overlords in the North. Meanwhile, the overlord intelligentsia such as Prince Lamido Sanusi (a possible future emir) and the governors are trying to divert the attention of the anti-oligarchy rebels by calling for dialogue, amnesty, the increment of federal allocation and "derivation". Sanusi knows his class is a direct target and he engages in a vainglorious adventure of shifting the blame to the nation and the South for the sins perpetrated by the Northern ruling oligarchy of which he is a member.

This oligarchy collects money from the federal purse and uses it to sponsor their families and friends to the Hajj. They refuse to address the educational disadvantage of their people by declaring free education. Instead they invest in Islamic schools, send the children of the poor there as almajiris and fill their minds with fatalistic ideologies hoping to use them against their political enemies. Why are children of the elite never found among these wretched of the earth, the almajiris?

They send their own children to the best Western-orthodox schools in the world to come back and rule the poor. They hijack the fertilisers meant for the hard working subsistence farmers and divert them for filthy profit only to go to the mosques on Fridays to dole out cash to the beggars and the hungry in the name of zakat. Even when the children of the poor manage to acquire Western education they find it difficult to get employment because they have nobody at the top. The North has very little middle class. Very few are able to move from the bottom to the top.

The situation is different in the South where, due to easy access to Western education, anyone can move from poor parentage to become anything in life. Jonathan had no shoes! The Northern elite climb to the top and kick the ladder away!

Because of its system, the North may never come out of the cycle of poverty. The system not only impoverishes but also makes poverty a self-perpetuating tool to keep the privileged class in their idle opulence, fully assured by easy money rolling in from the oil wealth of the Niger Delta. The North may also never get out of its "rising violence". These two twin evils have always been there in the North even before the oil. You never hear of them in nearby Sahelian countries where the oligarchy does not exist.

The North does not need more money from the oil wealth of Niger Delta. What Nigeria needs is to go back to the 1963 arrangement where federating units derive 50 per cent from resources in their environments.

That way, Nigeria will start working again.

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