By Christopher Akor
There is now a consensus that Nigeria has been run aground by bad leadership and corruption. Unlike in Asia where corruption often helps to grease the wheels of inefficient government bureaucratic machines leading to more efficient outcomes, the Nigerian case is all about crude and destructive greed where leaders simply extort and steal even when it is ruinous to the state. This kind of corruption has badly damaged institutions, led to decay/lack of investment in infrastructure, undermined both short and long-term economic growth, increased poverty, and contributed to the country’s dependence status in the global economy.
Interestingly, Nigerians have been quite vociferous in their demand for good governance and accountability. The country is reputed to be one of the countries with the most active and vocal citizenry, press, and civil society organisations. Despite all these, however, corruption and mismanagement of public funds have continued unabated.
But why is it that despite the outcry and damaging publicity on the social media and the threat of revolution, Nigerian leaders have largely ignored their citizens and continued with “business as usual”? Why has it been impossible, as yet, to make government accountable to its citizens in Nigeria like in other democratic countries? To find answers to this question, Nigerians may need to take a break from insulting and blaming their government for everything – a practice fast becoming a national sport – and look at themselves a little more than they are used to.
One area to begin with is to consider the ways the government gets its revenues and whether it is possible to institutionalise accountability in a system where revenue is ‘unearned’ and is not derivable from the people. By ‘unearned’ income, I mean revenues got where neither the state nor its citizens were actively involved in the process of earning the income. Nigeria’s oil revenues, strictly defined, are ‘rents’ paid to it by foreign multinationals. As of today, over 80 per cent of national income and 95 per cent of foreign exchange earnings come from the sale of crude oil.
This started in the early 1970’s when, thanks to the oil boom, Nigeria suddenly became awash with petro-dollars. The government consequently embarked on a spending spree: establishing hundreds of state-owned enterprises, and taking over control of universities and other utilities from state governments. Even religion was not left out as the government began to organise and subsidise pilgrimages. Meanwhile, the taxation system bequeathed by the colonial government was virtually dismantled. The government does not need the people’s money as it has enough coming from oil.
Nigerians, on their part, developed an unhealthy feeling of entitlement and a culture of expectation from their government. They expect the government to provide jobs, roads, hospitals, education, water, electricity, among others at little or no cost. “We are an oil-rich country after-all”, goes the usual cliché. The Nigerian notion of citizenship is basically rights-based – one that sees itself more as receiving from, and not giving to the state.
That is not all. Citizens also make huge financial demands from their representatives. These officials have no option other than to engage in corruption. In no time, the public purse became a huge cake from which anyone with access to it is expected to cut as much as they could afford for themselves and their local community. That is why, for instance, despite Nigerians shouting themselves hoarse, the salaries and allowances of their legislators remain the highest in the world. They need money to cater to the innumerable demands of their constituents.
As is usual with countries where governments do not depend on their citizens for revenues, the governments are usually not responsible or accountable to their citizens even when they claim to be democracies. They are more accountable to their sources of revenues. Any wonder then that African governments are more accountable to the IMF, World Bank and Western countries where the bulk of their revenues come from rather than their own citizens?
The fuel subsidy crisis in January 2012 provided an opportunity for Nigerians to extract some concessions from their government. The government wanted to end subsidy on petrol because it was a huge drain on government revenue. The people resisted. The ensuing national strike for once shook the government and it was obvious it was prepared to make concessions to the people. Rather than bargain for government accountability, reduction in the cost of governance and a commitment to end corruption as a pre-condition for accepting the price hike, Nigerians, led by the labour unions, were more interested in forcing the government to maintain the subsidy even though it does not make any economic sense to do so. For instance, while about $8bn was spent in subsidising PMS in 2011, the budget for education for the same year was only $2.2bn. Interestingly, after the hues and cries and the best efforts of the government, about N1.23tn ($8bn) will still be spent on fuel subsidy payments by the end of the 2012 financial year.
In a recent editorial that went viral, The PUNCH newspaper lamented that over N5tn ($31bn) has been stolen in Nigeria since 2010. The paper compared Nigeria to Norway which produces almost the same amount of oil as Nigeria but whose prudent management of its resources has made it one of the richest countries in the world. What The PUNCH forgot to mention however, is that whereas Norway’s population is just below five million and the government could afford to take care of the entire population with the oil money without batting an eyelid, its taxes are one of the highest in the world- 36 per cent personal income tax and 24 per cent VAT. This means that the citizens perform their duties and do not fold their arms and depend on the government for everything like Nigerians do.
In 2007, the Nigerian government attempted to raise VAT from five per cent to 10 per cent. Nigerians went on strike to force a reversal. VAT in Nigeria is still five per cent while personal income tax, except for places like Lagos, and for government workers, is virtually non-existent. Perhaps, what Nigerians need is a benevolent dictator like Moammar Gaddafi or the oil Sheiks of the Middle East. But they cannot have both democracy and accountability at the same time without paying the price. Perhaps, they can become the first country to achieve representation without taxation.
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