Speeches

50th Birthday Anniversary Of Mohammed Dele Belgore, SAN

Jun 25, 2011 - It is an honour and for me to be invited to speak on this occasion about democracy a most important subject, probably the most important concept evolved by man.

The idea of democracy and the freedom that it heralds, the duties it imposes and the potentials it offers as probably the best vehicle for ordering the affairs of men, exercising authority and distributing resources, is as perplexing as it is almost fathomless in its many manifestations.

Let me assert for the avoidance of any doubt at all, if any exists, that democracy is not synonymous with good governance. Indeed the ideals which promoted democracy and which still sustain it today are ideals of freedom and choice rather than those of bread and butter and I will in the course of this discourse elaborate with examples.

It suffices to say that while good governance is a worthy pursuit that should propel democratic society, the truth is that democratic pursuits are concerned about the freedoms that are exercised in the process of choosing leaders and not about whether those leaders will be the best persons to deliver on governance.

Democracy is therefore more concerned about whether the person elected was elected freely and fairly by the most popular votes, and it is less concerned at least on the face value, about whether the person elected knows anything about governance or that he will be compassionate or God fearing.

To that extent I have argued, that democracy is an ideal, but it is a good one.

I have in the past been privileged to attempt a demonstration of the correlation or lack of it between democracy and good governance in a lecture I delivered in 2010 at the Obafemi Awolowo University. I crave your indulgence to repeat some of what I said:-

"…democracy is an ideal and one which is worthy of pursuit by the Nigerian people and the Nigerian State.

It is the ideal whose pursuit enriches our values as human beings who were born free. Democracy guarantees freedom and choices although it may not always give good governance in terms of the equitable distribution of goods and services which is a function of the system operators rather than the system.

In the August 23 & 30, 2010 Edition of the Newsweek Magazine titled "the Best Countries in the World", Newsweek Top 100, an article by Rana Foroohar posed the following question before delivering the report of a survey of 100 nations:-

"If you were born today, which country would provide you the very best opportunity to live a healthy, safe, reasonably prosperous and upwardly mobile life?"

In the answer, Finland was number 1, Nigeria was number 99, Ghana was number 86, South Africa was number 82, Brazil was number 48, Singapore was number 20, USA was number 11, United Kingdom was number 14. Greece, with its recent economic and debt crises was number 26, Russia was number 51.

The United Arab Emirates, Jordan, Qatar and Saudi Arabia, that are not democracies in the contemporary sense of the western conception were rated 43, 53, 54 and 64 respectively.

Out of the 53 African countries on the continent, only 18 made the ranking, the highest being Tunisia 65, Morocco 67 and Egypt 74.

South Africa, which is reputed to be arguably the best democracy in Africa and the largest economy ranked lower than these "undemocratic" North African countries at 82.

If good governance is measured in terms of access to potable water, per capital income, provision of food, housing, education and healthcare, some monarchies especially in the Middle East are far ahead of Nigeria and they are not democratic.

It is my belief that we are not on the wrong course, and that these societies will still have to deal with democracy at some time and the same can fairly be said of states like Cuba, and North Korea and even China.

At the time I gave that lecture in September 2010, the crisis in the Middle East and North Africa had not started.

Of course we are now all witnesses to the virtual cessation of regular life in pursuit of freedom that we seem to take for granted even in its impure forms.

But while we pursue the purest and transparent forms of democracy, our attention must focus urgently on how to deliver good governance by way of improved security, provision of power, development of agriculture, economic growth and job creation, infrastructure renewal, sustainable healthcare, housing and many other indices that will make the quality of life of our citizens better.

This means we must address the form of governance by which the power vested through democratic choice is exercised.

This brings me inexorably to the question of our current unitary arrangement of Government that is masquerading as a federal Government.

I am a known optimist, but I want to be quoted today as having asserted very categorically that until that unitary arrangement is quickly discarded for a true federal arrangement in the political and fiscal sense, for so long will Nigerians be denied good governance.

Let me also restate here that those of us who argue for a true federal arrangement do not seek a federal arrangement for the sake of it. We seek it because Nigeria is made of many small nations with different histories, languages, cultures and resources, to mention but a few; and political history has demonstrated the merit of a federal arrangement as the best vehicle for harnessing such diversity for economic development through competition.

If there is a better political arrangement that allows the expression of such diversity, I challenge those who obstinately stand in the way of our federation to bring it up for debate and decision instead of wickedly standing in our way to prosperity because they constitute a majority in parliament.

This can only represent what has once been described as a tyranny of numbers. But let me quickly warn that it is a foolhardy tyranny that will come home to roost if we do not quickly proceed on the path of common sense, experience and logic.

Political Federalism

It must be said that many of the aberrations to our desired federal arrangement are traceable to the manner of the evolution of our Constitution in 1999, when a military leadership that is understandably military in its command structure decided to fashion a Constitution for us.

But that is as far as the blame goes, if that Government is blame worthy.

The perpetuation has been continued for 12 (twelve) years under a civilian dispensation and as if the missed opportunity to constitutional amendment in 2006 was mot bad enough, we frittered away tax payers' money under the guise of constitutional amendment in the 6th Assembly when the opportunity to decentralize the Police for security, electricity for power and industrialization, Local Government creation for efficiency in governance at grassroot level were begging for our attention.

How do we propose to address issues of maternal and child mortality, primary education and immunization against diseases such as Polio, whooping cough and measles if we do not allow States to take control of Local Governments and deploy them on the basis of their relative comparative advantage to create competitive productivity.

Legislations that purport to take the power to issue Drivers' Licenses from the States such as the Federal Road Safety Corp (FRSC) Act of 2007 have no place in a proper Federal Government.

This is why issuance of Drivers' Licenses has been characterized by fraud and this accounts for the large number of untrained drivers on our roads which cause untold numbers of deaths in road traffic accidents. The questions to ask FRSC are where are its training schools? How many drivers has it trained or how is it able to ensure that licenses are issued to trained drivers only?

Distinguished ladies and gentlemen, the absence of power, inefficient policing capacity and insecurity, high infant and maternal mortality rates, and fatal road accidents which reduce life expectancy are some of the indices of bad governance and poor quality of life that will haunt this country until we do the proper thing, and return to true federalism.

It is this kind of mentality, that the problems of all 36 States and all the Local Governments can be solved from Abuja that gives some Ministers the effrontery to pronounce that Governors should not touch Federal Roads without their consent. This is not only sheer arrogance in the face of ineptitude; it is the clearest demonstration of ignorance in a democracy.

Is it the Federal Government that owns the road or the people of Nigeria? The responsibility which the Federal Government has is to maintain the road and keep it in good repair and to encourage States to intervene with a package for compensation, where it is clearly unable to do so, as it has becoming increasingly evident in our country. That is the example of good governance.

Fiscal Federalism

As if the violations inflicted on the intended political federalism were not enough; the violations regarding fiscal federalism are patently linked to the inefficiencies we see in many parts of our social and economic life.

The Federal Government that should have limited responsibility in areas like defense, banking, currency, citizenship, foreign relations, broad economic, health, educational policies, maintains responsibility for 68 items under the Exclusive Legislative List in the Second Schedule of the Constitution and many parts of the Concurrent List.

On this basis, it keeps to itself 52% of the 'disclosed' revenues and I will speak about this shortly; and she has in the last 4 (four) years at least, been unable to implement any budget up to 50%.

The risk import of this is that wherever the Federal Government has failed the national economy suffers a 52% failure, while the successes of each of the States cannot amount to more than 26% of the national economy and that of the Local Governments, 20%, because these are the percentages of the 'disclosed' revenues that they get.

I have used the words 'disclosed' revenues deliberately to highlight the flaws in the accounting process.

Whereas the Constitution provides for all revenues to be paid into the Federation Account, there is no Accountant General for the Federation who is responsible and accountable to the stakeholders.

On the contrary, it is the Accountant General of the Federal Government, who in my view should be no different from the Accountant General of the States who keeps the account of the Federation and the Federal Government.

This is why Agencies of the Federal Government such as the Nigerian National Petroleum Corporation (NNPC), The Nigerian Customs Service, the Federal Inland Revenue Service (FIRS) who should be funded by the Federal Government, from its own share of the Federation Account dip their hands into revenues from sale of oil and oil assets, collection of duties and taxes to run their operations before paying what they declare into the Federation Account.

In the event therefore the Federal Government is taking more than the 52% disclosed and is evidently unable to manage it.

To make matters worse, it determines what percentage of revenues from oil should be used for budget and declares the rest as excess.

Most recently, it has sought to keep this in what it calls a Sovereign Wealth Fund to save for the future. The question to ask is which nation of the world became rich by savings only? The wealth of nations is measured by its productive capacity and balance of trade accounts.

It is strange economics to me to save money in the face of massive infrastructure decay and unemployment; because only investment in infrastructure renewal can catalyze this economy and create jobs, from which Government can raise taxes.

In any event, if the Federal Government has demonstrated patent inefficiency in managing its own 52% 'disclosed' share of the federation, which is evident in poor budget implementation, over 7,500 abandoned projects, what gives it the right to attempt to manage what should belong to the States under the guise of a Sovereign Wealth Fund?

If the States are continuously denied resources, and the Local Governments get just barely enough to pay salaries, is anybody still in doubt why the Nigerian economy is only recording growth in the books of record keepers and not in the day to day lives of her people.

As if these were not enough, the Federal Government proceeds to encroach into the areas of internal revenue generation left for the States, by passing unconstitutional laws and setting up agencies which in my view are illegal such as National Lotteries and a Tourism Agency that purports to regulate hotels.

Similarly, the Federal Government has to enact a law on National Minimum Wage to raise salaries for workers and expects all the States to comply with the same rate as if it is oblivious of their diverse problems and resources or that it is unaware that they do not collect 52% of the 'disclosed' revenues as she does.

The idea of a minimum wage in the manner that it is prescribed overlooks the diversity that is the rationale for a federal arrangement.

Clearly, it is understandable that the cost of living varies from State to State, whether it be for rent, for accommodation or for the procurement of basic staples like cassava, millet, beans and yam to mention a few.

While sensibly the Federal Government allows market dynamics, to regulate these necessaries, it surprisingly chooses to intervene in the cost of prices of petroleum products through subsidies and policies such as Petroleum Equalization Fund which have only served to enrich a few and pauperize the majority.

Why is there no equalization fund or subsidy for yam, cassava and other staples?

Some of the centrist arguments that I have heard is that there is only one economy in Nigeria. I have struggled to understand this and I pray that economists advise us how it is possible to have one economy when the Federal Government, State Governments and Local Governments make their own different budgets.

But the heart of the matter is that a uniform wage at the States by any argument overlooks the reality of the funding capacities of each State.

Here I must make myself categorically clear that I am not opposed to a quantum of wage such as N18,000.00 per month, but the point is that while some States may be able to pay more than this, some can only afford to pay a lot less.

If we take a random sampling of the highest beneficiaries across the geo-political zones this point will become manifestly clear, and indicative of how much is at the disposal of each State using only the figure of registered voters as an indicator of population.

NORTH CENTRAL   INFLOW FROM FG             REGISTERED VOTERS       PER CAPITAL
Kwara State            N3,546,956,747.65            1,115,665                         N3,179.23
Niger State             N4,729,387,839.09               721,478                         N6,555.14

NORTH EAST         INFLOW FROM FG             REGISTERED VOTERS       PER CAPITAL
Gombe State          N3,647,798,373.80            1,266,993                         N2,879.10
Borno State            N4,881,254,873.72            2,730,368                         N1787.77

NORTH WEST         INFLOW FROM FG             REGISTERED VOTERS      PER CAPITAL
Zamfara State          N4,025,243,690.31            1,746,024                        N2,305.38
Kano State              N6,590,372,930.38            5,135,415                        N1,283.32

SOUTH EAST          INFLOW FROM FG             REGISTERED VOTERS      PER CAPITAL
Ebonyi State            N3,436,753,775.44              876,249                        N3,922.12
Imo State                N5,399,735,042.21           1,611,715                        N3,350.31

SOUTH SOUTH       INFLOW FROM FG             REGISTERED VOTERS      PER CAPITAL
Cross River State      N4,835,637,458.06            1,018,550                       N4,747.51
Akwa Ibom State     N30,993,930,408.12          1,651,316                       N18,769.23

SOUTH WEST         INFLOW FROM FG             REGISTERED VOTERS      PER CAPITAL
Ekiti State               N3,465,257,334.89               750,753                       N4,615.71
Lagos State             N9,553,577,504.71            6,247,845                       N1,529.10

Distinguished ladies and gentlemen, although these are only examples of some constitutional anomalies and non-compliance that limit the performance of States and Local Governments in their financing capabilities, a lot more damage is done by legislations inherited by the civilian regime from the military and those that it continues to sponsor to the National Assembly.

Most recently, the Federal Government, through the Federal Inland Revenue Service, introduced a bill to the National Assembly for the amendment of the Personal Income Tax Act. Even though this Act is a federal legislation, it happens to be the main source of State Governments' internally generated revenue as it authorizes them to collect personal income tax from individuals, trustees, families and unincorporated businesses resident within their respective state territories. Indeed it was made a federal matter only for uniformity of rates and harmonization of assessment processes.

Aspects of the proposed amendment are no doubt desirable as the Act is fairly outdated. However, the Federal Government is taking the opportunity to effect a drastic reduction in personal income tax liability, which will cost the States up to 50% of their respective revenues from this source. While, this is said to be in conformity with the National Tax Policy which advocates a reduction of direct taxation, it actually spells financial disaster for the State Governments. As we know, a majority of them are struggling to survive and clearly unable to pay the new minimum wage enacted by the Federal Government.

A combination of the wage bill increase and internally generated revenue reduction is bound to erode whatever is left of State and Local Government autonomy as these tiers of government will simply be unable to function or discharge their constitutional responsibilities. In my view, our federal constitution does not envisage that the legislative authority of the federal government will be used in such a way as to frustrate other tiers of government this way.

Furthermore, these developments are bound to cause unprecedented labour disputes, service disruption and job losses in an economy that is already suffering from high unemployment and gross inefficiency. Fortunately, Mr. President still has the opportunity to withhold his assent to the Personal Income Tax Amendment Bill and cause a reconsideration of its implications by all parties concerned.

As it stands today, our maximum income tax rate of 25% is already one of the lowest in the committee of nations against whom we compare ourselves. Our West African neighbor, Ghana still has a 30% top rate in spite of its 12.5% VAT rate. Income tax rate in South Africa can be as high as 40% while Kenya has a 30% top rate. While we are not advocating a rate increase in Nigeria, there is no cogent or compelling reason for the high threshold and lower rate structure now being advocated in the amendment Bill.

What the Federal Government has been advised to do, by a Committee of Economic experts which she inaugurated and whose advise she has ignored is to give Income Tax relief to companies whose taxes she collects, first as a way to mitigate their operational cost arising from her failure to provide steady power or fairly priced diesel so that companies can remain productive, and competitive to be able to employ more people.

Distinguished ladies and gentlemen, I could go on. But the case for a true fiscal and political federal arrangement appears to me to have been made by some of what I have said, and what other eminent scholars have advised over the years. It is also my humble view that the lack of true federalism and its correlation with bad governance has been sufficiently advocated.

What we need to do now is to make the need for true fiscal and political federalism the single most important agenda for the National Assembly in the shortest possible time if our democratic experience is to translate to good governance.

At the time the whole world expected us to move to the rank of countries categorized as the Next 11 power houses of the World and BRINC nations, we have let ourselves down; and slipped into the company of D8 Nations.

The tragedy is that we have very little if anything in common with the D8 Nations except poverty and inefficiency.

These are countries that do not have many of the human and natural resources that we have. They are countries that are either at war internally or externally, and are sanctuaries for terrorism and crime.

Sadly, by the recent developments of a suspected "suicide bomb" we seem to have applied to join the global terrorism hall of infamy, as one media house put it recently.

When a society reaches that patent level of very scant regard for human life, whether for self or others you do not, need further evidence of the flight of good governance from that society.

If truth be told, we must tell ourselves and those who manage our affairs at the Federal level that we will be better off as ordinary members of the Next 11 and BRINC, than as leaders of D8.

As late Fela Anikulapo sang in his famous album, 'Beast of No Nation", "Na bad society". In my opinion, D8 is poor company. We must aspire to better company, through good governance delivered by a properly structured Federal Republic.

As I have said in the earlier part of this address, I am an optimist. It is on this note that I like to conclude by saying that all is not lost and our cause is certainly redeemable.

History has shown that transformational development is possible for nations within a cycle of 10 (ten) years. Nigeria will not be different and the 4 (four) years that now lie ahead can be the countdown to our decade of change if we urgently re-arrange our federation in a manner that harnesses our diversity to promote competition and stimulate productivity for social and economic growth.

I thank you all for listening. I wish my brother, Mohammed Dele Belgore, SAN a very happy birthday and many fruitful years ahead in the service of our country for good governance.

Thank you for listening.

Babatunde Raji Fashola, SAN
Governor of Lagos State