ACTIVE GOVERNANCE WITH NOTHING TO SHOW: Why Is It Here?


Nigeria has passed through several stages in its democratic expedition especially with the rigging of election as a standard political factor. If an election is rigged and the constitution is subverted, a provision in the constitution should contain a ‘secret key-word" to make it possible for a caretaker government constituted by learned clergy at the federal and state levels to take over and steer the ship of state for a period not exceeding three months until credible free and fair elections are held. That this nation is suffering from leadership afflictions is partly because her leaders have deserted the principles of setting records in deed to selfish accumulation in need. A bankrupt ruling class committed to a present dominated by a past of non-achievement sacrifices the future of a nation for personal greed and glory. In about thirty years time when the oil runs out, Nigeria would be like Mars or Venus, wastelands devoid of life or a future.

It is generally the poor that suffer from bad governance. If anyone were to challenge that claim, it would be difficult to present them with overwhelmingly convincing factual evidence. There is no consent on what actually make up good governance; and we have few reliable issues in the quality of governance for this country. We cannot expect much consensus around the question of how closely poor governance and national poverty are connected. I am asserting a an evidence and argument to explain a rather more specific problem: why there exists within our government a substantial number of really poor performers: regimes that are both (a) ineffective - i.e. are unable to rule many of their nominal citizens or to pursue any kind of collective interest in an authoritative fashion - and (b) arbitrary, despotic and unaccountable.

This kind of political underdevelopment in Nigeria today is a major cause of poverty and ill-being for many of us. It is especially prevalent in the local government areas and rural communities. There are large ‘patches’ of political underdevelopment in these areas, but they do not always correspond closely with national issues. Misrule and state impotence are found in the poorer areas of some of the big cities and in some more rural tracts, including much of the uncivilized region and rural villages. The levels of political development are often relatively high in these areas, but with some clear exceptions.

By contrast, the standard of governance in Nigeria is much higher than for many other countries at similar income levels. The central argument is that these lie to a large degree in the ways in which interactions with the rich (or ‘metropolitan’) cities have shaped, and continue to shape, the states of the poor . ‘Bad governance’ is neither acceptable.

In the culture or traditions of the people of poor communities nor a product of poverty, It is rather the result of the ways in which state authority has been constructed - and is being maintained – through economic and political interactions with the rest of the areas. The policies and practices of such government and the pattern of international economic transactions could help sustain poor governance. International aid and development agencies have identified’ bad governance’ as a major obstacle to economic growth and to improved welfare in poor countries. They are putting significant resources into trying to change that situation. Increasingly, aid is being conditioned upon performance and intentions of recipients in relation to ‘governance’ issues, whether labeled corruption, institutional development, democracy, capacity building, transparency, rule of law, human rights, or something else. It is striking that this degree of intervention into politically sensitive issues has taken place without stimulating a more vigorous search for an explanation of the underlying causes of the problem.

Why should ‘bad governance’ be relatively concentrated in poorer countries? The aid and development agencies themselves appear not to have asked this question in a very sustained way. Answer to the question is implicit in their behaviour, it would appear to be some idea of institutional deficit: poor countries lack the appropriate governance institutions, that are found in rich countries, in the shape of auditor-generals, police academies, independent central banks, legislative committees, responsible municipal governments, freedom of information laws, judicial autonomy, public policy research institutes, and many other things. I do not suggest that the donor strategy of institutional transfer is completely misguided. My case is rather that it may fail to address the major causes of governance problems.


I suggest here that improved understanding of the roots of political underdevelopment could show us better ways of promoting good government. It is ironic that aid donors should focus on institutional transfer when the institutional configurations of poor states are in most cases already very similar to those of rich states. In historical perspective, the world never appeared so similar to one another as they do at present .This emphasis on institutional transfer of course in part reflects the absence of alternative ideas about how usefully to spend aid money to improve governance. But it does also stem from messianic views of the virtues of democracy in Nigerian culture and, increasingly, from the willingness and capacity of the African Union to project onto the poor as a whole the same governance agenda that it imposes, with success, on the countries aspiring to join the Union.

Certainly this nation suffers from poor administrative, inadequate judicial infrastructure and insufficient numbers of expertise. But these short-comings cannot explain the abuse and misuse of state power in the continent. For instance, we have a large number of highly-trained professionals, including accountants and constitutional lawyers. Laid down budgetary procedures, include provisions for checks and balances, and are adequate. But the fact remains that Nigerian rulers have ignored the provisions of the constitution and laid down administrative procedures are irrelevant to the actual workings of government.
Abuse and misuse of power and authority by Nigerian rulers have not been largely due any national lack of capacity for good governance. Nigerian leaders have not been ineffective and tyrannical because they are incompetent or ignorant. Neither has the lack of administrative or intellectual expertise to formulate and properly execute growth enhancing policies been the major problem. Quite simply, Nigerian leaders have acted in their own selfish interests in total disregard to existing rules and laid-down procedures.
The popular image of African rulers as bungling buffoons is not helpful. It obscures reality. Anyone who has observed the way in which the military has dominated politics in Nigeria would see that the generals are no fools. They and their advisers have shown themselves to be quite adept in the art of retaining political power. Since the early 1990s they have toyed with the civilian political class. General Sani Abacha has since seizing power in 1993, with remarkable political skill undermined the opposition - sowed confusion in their ranks and made them loss credibility in the eyes of the public. Judged by Machievellian standards, Nigeria's ruling generals and their advisers have shown great political sophistication. It would be a mistake to approach Abacha and his cronies as a bunch of idiots, ignorant of the art of politics.


Export taxes, for example, are probably less earned than most income, sales, turnover and property taxes. But these kinds of distinctions are insufficiently explored and too fine for my purposes. I am focusing here on gross differences between states that live from earned income and those that depend to a large degree on the dominant sources of unearned state income found in poorer citizens among others: mineral revenues, especially oil wells; and aid. A more complete account would look, for example, at revenues from such sources as timber, diamonds, narcotics and agricultural commodity exports (coffee, cotton, cocoa etc.). These have all been significant sources of (relatively) unearned income for many poorer states of this nation in recent decades. But the extent to which these revenues are appropriable and appropriated by states depends very much on specific institutional arrangements that change over time. Government monopolies on agricultural commodity exports are now far less significant as sources of revenue for poor states of this nation than they were two decades ago.
These kinds of non-oil commodity revenues are relatively contestable: peaceful citizens and/or armed bandits and insurgents can often claim a large share .I focuses here on the main categories of unearned revenues - oil and aid - that, for different reasons, most of the time reliably accrues to the people that hold state power.

Rather than beginning directly with the dysfunctional consequences of dependence on oil and aid revenues, let us look at familiar, developed, states from an unfamiliar angle. What are the implications of the fact that they live from, and were largely constructed on the basis of, earned income? Living from earned income has the following consequences :(i) we have an incentive to recruit a capable and relatively honest public service, with internal financial and personnel controls, so that liability for tax can be assessed. This attitude gives rise to some interesting hypotheses. For example, Singapore levies scarcely any taxes. Most public revenue is ‘non-tax’, coming from charges on the development and management of public infrastructure and services: port facilities, public transport, property development, and public utilities. The arguments developed in the main text would indicate that the Singapore state apparatus should score highly in terms of the statistic values of competence and authority, but low interims of the liberal values of accountability and responsiveness to citizens. That indeed appears to be the case. As is evident from Tully’s work in particular, our income that derives from crisis would count as earned income within our framework. Such income significant for Africans is only witnessed occasionally: they financed their wars mainly from internal sources.

As long as African political rulers and administrators are drawn from this class of predators, no amount of preaching the virtues of good governance or tuition on public administration will fundamentally alter the quality of governance. This is not to say that constitutional reforms and increasing civil society infrastructure are not important. They are. But they are not the key to solving the problem of bad governance.
Good governance is the effective exercise of power and authority by government in a manner that serves to improve the quality of life of the populous. This includes using state power to create a society in which the full development of individuals and of their capacity to control their lives is possible. A ruling class that sees the state solely as a means of expropriating the nation's limited resources is simply incapable of good governance. More specifically, such a class will by its character and mission abuse power.
An underlying cause of many of the manifestations of bad governance, including political repression, corruption and ethnic sectarianism, is the endeavour by the ruling classes to be and remain part of the global elite despite their nation's poverty. The competition for national resources leads to conflict and repression. It is difficult to see how there can be good governance when the orientation of the elite is to stay in the running and be part of the fifth of the world's population that forms the international consumer class. Bad governance is not a mainly problem of ignorance or lack of infrastructural capacity or even of individual dictators. States in Africa are incapacitated as instruments of development because ruling classes, including people in and outside government, are motivated by objectives that have little to do with the common good.

The National Economic Empowerment and Development Strategy (NEEDS) were launched in May 2004 as Nigeria’s home-grown growth and poverty reduction strategy. Nigeria’s 36 states have also developed State Economic Empowerment and Development Strategies (SEEDS). The NEEDS and SEEDS focus on achieving growth, better service delivery, reform of government institutions and the political system, and transformation of values to overcome corruption and inefficiency. DFID’s assistance in Nigeria is focused on supporting the Nigerian government’s efforts through NEEDS and SEEDS. DFID and the World Bank signed a joint four-year Country Partnership Strategy (CPS) in Nigeria in 2005. USAID have subsequently joined the partnership. The CPS is an important vehicle for improving aid effectiveness in Nigeria by: Enabling donors to speak with one voice, reducing transaction costs for the Government; and increasing donor impact through improved co-ordination of activities around NEEDS, Nigeria’s own plan for growth and poverty reduction.



The poverty becomes unabated because the States control their own public servants, because they recruit and pay them. Again the livelihoods of many citizens are taxed, public bureaucracies record a great deal of information about individual citizens; and individual public servants come regularly into contact with citizens. A taxation system is simultaneously a governance intelligence mechanism. It comprises two main elements: (a) sets of information on citizens - names, addresses, occupations, incomes, business turnover, wealth - that states might not otherwise collect and maintain; and (b) a network of public tax collection agents who use this information, collect a great deal more in an informal way, become repositories of knowledge about what is going on in the far-flung parts of polities where state elites may have little direct knowledge or influence.(iv) Because the material prosperity of citizens increases their taxability, there are large areas of public policy within which states and citizens have common interests.(v) There is scope for the emergence of representative government because (a) of these common interests between state and citizens (in the use of tax revenues to promote prosperity); (b) the process of tax collection can be made easier or less costly for both parties if tax payers are consulted about modes and levels of taxation; and (c)the fact of paying direct taxes is likely to motivate the payers to take an interest in how ‘their’ money is used:” Historically, states have become beholden to their citizens through reciprocal obligation. Impersonal, formal, arbitrary state extraction - taxes and conscription for example - was the first sign of government as penetration and control in the early modern nation state. It was soon followed by demands, particularly among property holders, for protection against such arbitrary exactions and for a role in deciding how state income was spent.

This development we now think of as the expansion of individual rights, democratic participation and class politics. In mineral producing states, wealth translates into the capacity to pay taxes to, and demand work on the revenues of such state .It has helped correct a widely-held misconception that the state was strong and effective in the absence of a dedicated state apparatus - and reliant largely on the part-time, voluntary administrative activities of the propertied classes.



Striking a deal from the government - that is, into political power” ,some greedy politicians pose temptations for the khaki-men to take over state power by force on the ground that the knowledge that the state’s income stream can only be kept flowing if the new regime either has the capacity to manage a complex revenue assessment and collection mechanism (possibly including an element of representation) or is able effectively to deploy more arrogant power to collect taxes. This image of the politics of a state dependent on earned income is necessarily idealized: we are dealing only with the fiscal dimensions of states, and that in an unusual way. That it does however point clearly to some of the implications of the obverse situation: dependence on unearned income. There are many variants of that case. It is sufficient if we deal with our two main types: oil and aid states. Oil first.

What happens when the government of our country is substantially or entirely dependent on this oil for its revenues? Leaving aside the historical specificities of each case, the general logic that emerges from the various sources cited above suggests seven distinct pressures toward political underdevelopment: Autonomy from citizens. The state apparatus, and the people who control it, have a ‘guaranteed’ source of income that makes them independent of their citizens (‘subjects’?). Why listen to citizens? Or give them any kind of democratic influence over the state? Or use scarce administrative resources to promote broad economic development when the state can feed itself from mineral revenues - or from using those revenues to establish ‘mega-projects’ under state control? It is more efficient to use some revenue to buy off those citizens likely to cause trouble, and more of it to support a powerful army and intelligence apparatus that will keep the others in line.

Those in power are reluctant to cede any influence to other groups, lest this become a foothold for a complete takeover of the state.(iii) Ineffective civil service. There is little incentive to establish an efficient civil service. The task of raising revenue from the mineral facilities requires few specialists, and these may be imported to make them more easily controllable. It isn’t necessary to establish the kind of efficient meritocratic civil service that is required to manage a complex tax system, or to establish the control mechanisms and public service values needed to protect against the worst abuses in tax collection. In the civil bureaucracy, jobs will be given mainly for patronage purposes, and for directly political reasons. Insofar as there are incentives to create an efficient public bureaucracy, these will be concentrated on the military and intelligence apparatuses. And it is to these apparatuses that able and ambitious young people are attracted.(iv) Vulnerability to subversion.

The failure to tax the bulk of the population - and thereby bring them into the ambit of a regular civilian bureaucracy - leaves the state vulnerable to the (armed) organizational challenge of competitors - guerrillas, private armies based on the narcotics and arms trades, and non-state movements of various kinds, including, in contemporary herein, autonomous Christian and Islamic movements. The key insight, shared inter alia by counter-insurgency specialists, is that active revenue rising may be an important means of keeping the state machinery alive and active at the grassroots. If the revenue raising function is permitted to decay, weak states leave themselves vulnerable to more committed unorganized predators:” In the course of an internal war, economic assistance tends to become an alternative source of revenue for the local regime, allowing it to neglect its domestic tax base and thus leave it to the insurgents to exploit. This is not to suggest that regimes facing an internal war ought to tax their populations more heavily, but it is to say that, in order to tax the countryside and the urban sectors, they have to rule those sectors. If they rule them, the insurgents do not"


Where public revenues come from a small number of concentrated sources, such as a few foreign oil companies or a public mining enterprise, it is relatively easy for revenue and expenditure to be hidden from view. If a legislature exists, it has limited capacity to exercise oversight over the state because it has very incomplete knowledge of - let alone control over - the myriad ways in which state and quasi-state agencies raise and spend money. The official’ budget’ may represent a mere shadow of the true fiscal situation. The NNPC, was a fiscal and political firm .Oil Producing states appear to appropriate an unusually low proportion of national income, but this may be because the flow of resources to the state is understated in the accounts .Absence of incentives for civic politics. Dependence on oil revenues affects the general tenor of civilian politics, and reduces, through two very different mechanisms, the likelihood that citizens will engage in politics in a ‘civic’ (deliberative, institutionalized, compromise-prone) fashion.

None of those options are in general conducive to political stability or to any kind of state-citizen accountability. The more elaborate the existing taxation infrastructure - with officers, understood procedures, current information on the names, addresses, occupations, incomes, business turnover, wealth etc. of potential taxpayers - the more likely is it that a state can substitute in a non-coercive fashion for sudden shortfalls in major income sources. The implications of dependence on unearned aid revenues are less easy to summarize than the oil cases. The aid situations appear more complex and diverse, for three reasons :(i) First, state financial dependence on aid typically is less extreme than dependence on oil. It is rare to find the aid equivalents of Libya and some of the Gulf States, where oil accounts for virtually all state income. My best estimate, for the early 1990s, for the countries classified by the World Bank as ‘low income’, was that aid typically amounted to almost half of state income. The range is wide.(ii) Second, some of the malign political consequences of aid stem as much from the large number of (competing) aid donors as from the overall aid volume (see below).Here again there is diversity, although, unfortunately, most heavily-aided countries enjoy the attentions of a large number of separate official donor agencies.(iii) Third, aid dependence is fundamentally unlike oil dependence in that (most) aid donors have a mission to influence the governance of the recipient. ‘On the issue of governance, oil itself is silent. Aid donors would like to think they make music, but rarely achieve more than noise.’ With those provisos, we can make four general points about the implications of aid dependence for political development: Rwanda has in recent years been aid dependent to much the same magnitude. These estimates are very approximate, as one of the symptoms of political underdevelopment is lack of (reliable) public finance data .I am indebted to a participant in a World Bank seminar for this metaphor.





The early years of independence, governments typically practiced a dual budget system. The local (i.e. recipient) government financed the recurrent budget from local revenues. It made a ‘local contribution’ to the capital (or investment) budget, which was funded largely by aid donors, with the recent colonial power typically playing a significant role. The capital budget was prepared within the framework of national development plan. The 1970s and after were marked by economic and fiscal crisis, increased aid inflows and growth in the number of (official) aid donors. Major changes in budgeting practices resulted. With recipient governments unable to meet’ local contributions’, aid projects became 100% donor-funded. They began to be omitted from the formal government budgeting process because they did not require public funds. As public sector salaries declined, donors increasingly, through a range of ‘allowances’, paid the salaries of the government staff formally seconded to their projects, or working in closely related activities. Donor influence over the deployment of local public servants followed inevitably. As locally-generated revenue for recurrent expenditures declined further, donors began informally to assume wider financing responsibilities in sectors that appeared high priority to them, such as health. Aid ‘projects’ began to fund a mix of investment, rehabilitation and recurrent activities. Local public funds were concentrated on urgent local priorities that often included the military. On the one hand the donors, locked into situations where they cannot permit their projects openly to fail, appear to be behaving in amore intrusive fashion. On the other hand, their aid is to a large degree fungible: knowing that donors are committed to keeping health and education services on their feet, recipient governments can concentrate their limited funds on the military and other activities that they regard as priority.



First, basic infrastructure was allowed to get to near total decay, with electricity generation barely enough for one-fifth of the population. Secondly, there was also less focus on wealth creation which led to poor attention to investments in human capital. Thirdly, there was a culture of impunity by the leaders, occasioned by four decades of militarization of virtually all aspects of governance and disrespect for the Constitution. A fourth consequence was the excessive fiscal expansion occasioned by accommodating monetary policy, which fuelled inflationary expectations during the past decades, with inflation reaching an average of 28.5 per cent in the 1990s and an overvalued exchange rate, leading to great macroeconomic instability.

The beginning of lifting the curse for any resource rich (oil-producing) country is the realization that the revenue bonanza should not be used to increase current consumption but as a springboard to economic development through boosting real living standards, by financing a higher level of investments and core public goods like massive infrastructure. The starting point for managing oil wealth lies in a long-term national development strategy predicated on stimulating both public and private investment. Nigeria’s effort to break away from the manacles of the resource curse essentially began in 2003 with the unveiling of a home-grown reform agenda titled the National Economic Empowerment Development Strategy, NEEDS. Economic reforms refer to positive changes in economic policies aimed at achieving different objectives or same objectives at a faster rate. They focus on ways of doing things and on setting targets. Reforms become necessary either when existing policies fail to achieve set targets or when set targets are found to be unsustainable and so need to be changed. (Economic reforms introduced include macroeconomic, fiscal policy, budgetary, monetary policy, debt management, banking and financial sector and other sectoral reforms).

Another landmark achievement is in the area of pension reforms. This has brought resources that are channeled for long-term investment in the economy. The pension commission in Nigeria has an asset base of over $5 billion, as at 2006. To compliment all these reforms are the institutional reforms that were geared towards achieving efficiency and streamlining government operations for better service delivery. For example, the Federal Inland Revenue Service and Nigeria Customs Service, NCS, all point to the same direction. The tax structure is being overhauled to a simpler tax system that will improve revenue collection by the agency. Also, the NCS has adopted the common external tariff structure of the Economic Community of West African States, and this measure is expected to encourage imports through the Nigerian ports of entry, which otherwise were diverted to neighbouring countries. These measures are aimed at boosting non-oil revenue.

The national economic development aspiration has remained that of altering the structure of production and consumption activities so as to diversify the economic base and reduce dependence on oil revenue in the bid to return the economy to the path of self-sustaining growth and industrialization.
The Government's resolve to eradicate poverty, improve the livelihood of the people and ensure sustainable development of the country for present and future generations led to the formulation of strategic policies and implementation of sustainable growth programmes, which are slowly, but-significantly making an impact. The Habitat Agenda, Agenda 21 and the MDGs remain the basic framework for action. The key strategies of urban development, provision of adequate shelter; poverty eradication; environmental management; economic development; governance and international cooperation for development, are examined in the following sections. Strategies for balanced development Strategic plans and regional planning are very important institutional supports to an integrated approach to the sustainability of cities. The balanced developments of human settlements in the country have been primarily achieved through increased states and local governments' creation. The increase to 36 States and 774 Local Government Councils structure in 1996 has meant the establishment of more urban centers in the country. This development has helped to ensure the even spread of towns and cities across the country. Furthermore, the location of a new Federal Capital in the central region, and the establishment of universities and colleges in virtually every state capital have helped in bringing about balanced urban settlement and growth. However, despite the political re-structuring of the country, the widening disparities between the urban and rural areas in terms of the quality of life remains a major concern of sustainable development. To redress this problem, the 36 States have been regrouped into six geo-political zones based on linguistic affinity, contiguity and cultural affiliation. Political appointments, investment decisions and development projects for instance, are considered principally on the basis of geo-political balancing with the hope that it will bring about balanced development in the long-term. Urban development reforms.

The revision of the National Urban Development Policy in 2001 was another bold step towards ensuring sustainable human settlements in Nigeria. The Urban Development Policy has the goal of developing ""a dynamic system of urban settlements that will foster sustainable economic growth, promote efficient urban and regional development and ensure improved standard of living and well being for all Nigerians". The direct involvement of the citizens in decision making is a priority for the success of the policy. Two factors identified for sustainable urban development are:(i) Participatory urban governance in which leadership of neighborhoods and wards as well as occupational groups, chambers of Commerce,womenorganizations,youths,othernon-governmentalorganizations are closely involved both for popular enlightenment and general consultations; and(ii)A more effective urban management information system based onthe numbering of all houses, the naming of all streets, the demarcation of all neighborhoods and wards in the city. A necessary institutional framework has been established to ensure effective implementation of the policy by the creation in July 2003 of a Federal Ministry of Housing and Urban Development to implement the provisions of the policy. Future priorities for sustainable urban planning include.

Pursuing programmes of urban renewal and slum upgrading in decaying urban centres, Preparation of cadastral maps for all urban centres as a basis for efficient urban planning and development; Development of comprehensive master plans to ensure coordinated development, Establishment of a national urban information database for planning and raising citizens awareness and access to information, Implementation of community-based urban development projects in thirteen locations, Preparation of strategic regional development plans for the six geopolitical zones to reduce regional imbalances; Implementation of programmes directed at bridging the rural-urban divide; development of satellite towns to redirect growth to the hinterlands and Building capacities for improved management, urban development and Providing adequate shelter for all. The housing scenario in Nigeria is essentially one of inadequacy in quantity and quality. A widening gap exists between expectation and the capability of realization. The difficulty in mobilizing sufficient funds into the National Housing Fund has made it impossible to appreciably increase the housing stock. Other problems are poor access to land, secure tenure, no availability of cheap building materials, poorly developed local building materials base and absence of infrastructure on land for housing development. In response to these challenges and to promote sustainability, a new National Housing Policy of Government was developed in year 2001 which has the primary goal of ensuring that "All Nigerians own or have access to decent, safe and sanitary housing at affordable cost and with secure tenure".

Years of poor governance eroded the rule of law and bred corruption. Nigerians are frequently unhappy with current political and economic conditions, but strong majorities support the broad democratic ideal and reject alternatives to a competitive, accountable democracy. However, public opinions clearly reflect the strains on the system, and the dangers of deep, persistent popular frustration with present governance. The April 2007 elections significantly affected the legitimacy of Nigeria’s fragile democracy. Since a highly flawed and unstable election exercise has discouraged voters and undermine the foundations of this democratic rule, I believe, a credible, peaceful electoral process would reinforce confidence in basic institutions and as well restore a measure of patience with this democratic system.

L.Chinedu Arizona-Ogwu
Founder; Nigeria4BetterRule
Writes from Oyigbo; Rivers State
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