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REVENUE ALLOCATION AND POLITICAL STABILITY IN NIGERIA 2010 TO 2015

ABSTRACT

Nigerian federalism has been greeted with vehement opposition since its start in managing revenue distribution among its constituent sections, which has devolved into a perpetual conflict. The point of disagreement has always been the revenue allocation method or parameter that was deemed unsatisfactory. The result has become a defining factor in social, economic, and political ties among the federation’s classes, groups, and ideologies. Financial subordination, on the other hand, is a deviation from the proper functioning of federalism, according to the logic or theories of federalism; in other words, all component parts, including the central authority, should have the power in the constitution to control their own fiscal resources. However, such theory does not address the issue of hegemony in connection to political power or control of natural resources, nor does it address the issue of weaker or disadvantaged places. Throughout comparison to Nigerian variation, there are features that may not be typical to other federalisms in history. This one-of-a-kindness lays a colossal burden on the state in terms of ensuring equitable revenue allocation.

CHAPTER ONE

INTRODUCTION

BACKGROUND OF THE STUDY

Nigeria is not just Africa’s most populated country, but also the continent’s largest and most important petroleum producer. Crude oil exports account for over 90% of the country’s foreign revenues, however non-oil producing sectors are beginning to show substantial revenue-generating potential. The significant crude oil deposits of Nigeria are geostrategically located in the Niger Delta region, which comprises only 9 of the 36 states that make up the ethnoculturally varied federation. Abia, Akwa Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo, and Rivers are the states that make up the Niger Delta area. In the wider Niger Delta region, there are over forty ethnic groups and a population of over 30 million people. The Ijaws, Itsekiris, Urhobos, Isoko, Edos, Igbos, Yorubas, Ogbia, Ibibios, Ilajes, Ikweerres, Kalabaris, Efiks, and Ogonis are some of the major ethnic groups of the Niger Delta. In the modern Nigerian political system, the geo-territorial arrangement of the war for crude oil is depicted in the above map. Shell Petroleum Developing Company, Nigerian National Petroleum Company, Chevron/Texaco, Exxon Mobil, Total Fina, ELF Aquitaine, Agip, and their subsidiary contracting companies are among the oil majors operating in the resource-rich and destitute Niger Delta region, also known as Nigeria’s “Kuwait.” Pipeline vandalism, illegal bunkering, and illegal tapping of crude oil by criminal syndicates that include a slew of sea pirates, cults, brigands, restive youths, and more organized insurgent groups that have unleashed a reign of insecurity, impunity, hostage takings, and other forms of economic violence in order to capture spoils and demarcate preferred petroturfs for black mark have reduced crude oil exports to less than 2 The Movement for the Emancipation of the Niger Delta is currently the most significant ethnic militia in this volatile region (MEND). Nonetheless, there are a slew of armed groups and criminal gangs operating in the Niger Delta’s nine southern states. The diagnosis and study of the complex interplay of State power, local-regional political dynamics, and ethnic strife by corporations in Host-Communities, as well as stakeholders pursuing sustainable economic development in the Niger Delta region, most often takes a multi-layered approach. Beyond the usual primacy of economic determinism and rational choice models, brutal contests for resources, historical revisionisms of proprietorship rights, and convulsive community environmental tragedies should be studied. The Niger Delta Question thus necessitates an interpretatively qualitative and holistically integrated analysis that combines strands of different theoretical paradigms and, more importantly, integrates a perspective that focuses on the region’s historical sociology and an analysis of the ethno-energy-conflicts and security dilemma’s internal political roots.

STATEMENT OF PROBLEM

The debate over revenue allocation in Nigeria is inextricably linked to the function of the ruling class as well as power dynamics among the component nationalities. Particularly since the start of the oil boom in the 1970s, when it became the largest source of federally collected money, tensions have risen between the ruling elites representing the North and South’s local bourgeoisies. The allocation of revenue has been the focal point of conflict or animosity. The researcher seeks to explore the impact of revenue allocation and political stability in Nigeria on this note.

OBJECTIVES OF THE STUDY

The study’s main goal is to determine the relationship between revenue allocation and political stability in Nigeria. The researcher intends to achieve the following goals as part of the study:

To determine the impact of revenue allocation on Nigerian political stability.
To look into how revenue allocation affects national integration.
The purpose of this study is to look into the role of income allocation in the consolidation of Nigeria’s federalism.
Determine the relationship between Nigerian resource control and political stability.

RESEARCH HYPOTHESIS

The researcher devised the following research hypotheses to aid in the execution of the study:

H0: Nigerian political stability is unaffected by revenue allocation.

H1: In Nigeria, revenue allocation has a significant impact on political stability.

The allocation of H02 money has little bearing on the consolidation of Nigerian democracy.

H2: Revenue allocation is critical to Nigeria’s democracy consolidation.

SIGNIFICANCE OF THE STUDY

It is expected that, once the study is completed, it will be of great use to the political class who advocate for resource control and efficient resource distribution, as this will foster a sense of oneness among Nigerians, as the study enumerates the importance of resource allocation on national integration.

The study will be useful to the state government because it focuses on the importance of ensuring that the region that produces the state’s resources is properly developed in order to give the populace a sense of belonging rather than exploitation, as this will lead to peaceful coexistence in the country. Researchers who plan to do research will also benefit from the findings.

SCOPE AND LIMITATION OF THE STUDY

The study’s focus includes revenue allocation and political stability in Nigeria between 2010 and 2015. However, the researcher encounters various constraints in the study’s purpose.

(a)Research material availability: The researcher’s research material is insufficient, restricting the study’s scope.

(b)Time: The study’s time frame does not allow for broader coverage because the researcher must balance other academic pursuits and examinations.

(c)Finance: The funding available for the study project does not allow for a wider scope of coverage due to restricted resources and the researcher’s other academic obligations.

DEFINITION OF TERMS

Revenue

The amount of money a company actually earns over a given time, including discounts and deductions for returned products, is referred to as revenue. Net income is calculated by subtracting costs from the “top line” or “gross income” figure.

Allocation of revenue

The Nigerian government’s financial system is structured so that funds from the federation account flow to the three levels of government.

Politics

Politics is the process of making decisions that affect everyone in a group. It refers to gaining and exercising positions of governance organized control over a human community, particularly a state, in a more limited sense. Furthermore, politics is the study or practice of power and resource distribution within a certain community (typically a hierarchically structured one).

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