Ahmed: Councils Face Imminent Collapse

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In an interview with journalists, Kwara State governor‎, Abdulfatai Ahmed, warned that except there is an increase in allocations to local government areas, the third tier of government risks imminent collapse. Hammed Shittu presents the excerpts:

What has Kwara got to celebrate at 50?

A young state was created in 1967 from two old provinces, Ilorin and Kabba. Since its creation, we have moved substantially from being provinces to a well developed state today. For those who are witnesses to the trajectory of where we are today, Kwara state has gone through a lot and so we have a cause to celebrate. Looking through a list of past governors that manned the state in the last fifty years, including myself, we have 19. On the average, it means by the turnover, a governor does not spend more than two years or maximum, two and a half years on the throne. The turnover has not allowed for consistency or for any governor to involve in any long term plan. However, economic wise, Kwara state has moved from being a civil service driven environment that it was to an economic hub. Those of us here in early 90s till sometimes 2003/2004, you can count the number of commercial banks in Ilorin, not to talk of other areas.

The incursion of commercial banks tells you that there is a significant increase in the level of bankable businesses in this environment. In terms of infrastructure, you will see that a lot of communities are linked up through our new roads or the rehabilitation of old roads. Looking at the education sector, there is a significant increase in number of tertiary institutions in the state. Talking of even secondary schools, there is a significant increase in number of schools far more than we have in those days. Most importantly, you will see the level that our health care systems have been brought to; in addition to rehabilitating some key ones in strategic locations, we have been able to torch quite a significant number of rural environments where we have either basic or primary health centres. We have built and renovated a lot of schools and lot more are coming. In terms of water supply, so many communities are having access to portable drinking water either through boreholes or surface channels. All in all, I would say Kwara state has appreciated tremendously economically, socially, politically and of course in terms of infrastructure. In the area of human capital development, we have significantly moved forward at fifty and that signals that we have done what we could within the trajectory of development and a lot more could still be done. Don’t forget, when the statistics were being read in the hall a few weeks ago the state was mentioned as having the least number of unemployed youths. This didn’t just happen by accident; it is by conscious effort in supporting our youths in accessing employment in one form or the other. These are some of the changes we see and it is worth celebrating as the state clocks fifty. Our prayer is that the next fifty years will be strategically approached in way and manner that people’s life will be better than where we are today.

Is it true that the state government spent about N2billion on a low key celebration? How much was budgeted for the Kwara at 50 celebrations?

What was budgeted was appropriated, it’s there in the appropriation law. I am working within the budget. Those who criticize us need to see the public document, budget. How much we spent was in there, check you will see whether what we have done is appropriated. What we spent is less than 10 percent of what people are saying. When the SSG came in, the committee chairman, I hugged him because he had been judicious, we never expect that the amount will be enough, less than ten per cent.

Why is local governments not carried along in this celebration?

There are about 774 local governments in Nigeria, most of which were created largely based on political exigencies. If you go through the constitution on criteria for creating local governments, you will see that quite a few fit into these criteria. Most of them were created during military administrations. Currently, they are heavily reliant of federation allocation and the same allocation has been dwindling monthly as a result of dwindling price of crude oil. So you cannot expect to see much from local government outside Lagos. Lagos is a purely commercial environment. Take a council like Isin Local Government, what kind of commercial activities go on there? What resources can you raise from that kind of a place? What sort of internal revenue can you raise from that place? And ditto for other local governments in most of the states that are not in commercial environment. It’s a huge challenge. That is why even the payment of salaries, which is most critical, they are faced with today is not doable one hundred percent because their capacity to raise revenue is weak and they are presently reliant on the dwindling federation allocation account. It is from this allocation that local government workers are serviced from, teachers at basic levels are serviced from it, so also local government pensioners. So it is difficult to see them get hundred percent of their emoluments. Their emoluments is a function of the federal allocation that comes in. This is a challenge and there is need for a reform to address the situation. Is either we increase allocation accruable to the local governments or create a level of flexibility that allows a stronger synergy with the states in such a way and manner that they too can tap into what the states are doing to improve their revenues. This is part of the challenges that local governments are faced with. A place to draw comparison from is not likely Lagos. When you draw comparison with Niger state, Ekiti state and Osun states, then you are talking. Lagos has been a federal capital; every structure is on ground to make things work. The Lagos environment has been made more enabling for those things to thrive.

Despite the money spent on water reticulation projects in the last six years now, residents still go through hell to get water. What exactly is the problem?

The number of people in Kwara yesterday are not the number today, so meeting the needs of the people in the areas of water is a continuous process. We are still on the reticulation, which is about 95 percent completed. The need is growing, what the people need is far bigger than twenty five million gallons that was just completed because more people are coming in and that is what happens everywhere in the world except for populations that are not growing. Except where new children are not born; probably where there is war or something except that, population will keep growing and government will continue to work towards expansion, it is an ongoing process. In essence, there will continue to be pressure on power supply and on water. The same thing goes for health services and on infrastructures. Government will continue to put machinery in place not only to expand new ones but also to rehabilitate old ones. These are parts of the challenges that government business are faced with. For water, as we continue to maintain the old ones that are being put under pressure, we would ensure that new ones are also put in place. Within the available resources at our disposal, we are able to carry on to certain levels and we still have a lot more that we can get to.

What are you doing about the case of unpaid retirees at the local government levels?

We need to understand how federal, state and local governments are run. The local governments as it were, have their allocation sent to them from the federation account and when it gets in, it comes into a joint allocation account, jointly owned among the sixteen local governments. The term ‘joint allocation account’ is not joint with states but amongst the sixteen local governments. Let it be clearly understood. It is within this platform of joint allocation committee based on laws put together by the state’s house of assembly to guide them on how to allocate these resources. This is what the constitution stipulates that their money would enter into a joint allocation account, and the money will be disbursed in accordance with the laws of the houses of assembly, so each time the issue of shortfall come in, the ball is thrown back to the state governments. The state government does not share in that joint allocation; and it is within this platform of the joint allocation committee that they decide what goes into what they jointly fund for example, they jointly fund SUBEB, they jointly fund traditional rulers, they jointly fund the local government service commission. After all these, the funds are now appropriated to local government workers, pensioners and of cause SUBEB. So each time you hear of shortfall in allocation, it will affect what goes into these local governments and that is why in the last one year, it has been difficult to get hundred percent of their salaries because allocation had dropped significantly and local governments as you may know do not have the capacity to increase what comes in from as revenue unlike states that have other financial ways and means of increasing their revenue through revenue generating strategies. You all are aware of what we have done with the internally generated revenue of the state by increasing it from N500 million per month to N1.5 billion per month. That is a significant increase for us at the state level; it is not the same at the local government level, local governments do not have the latitude to do such. This is because their environment is not robust enough to create this kind of revenue base. So it is a major challenge. They need to reform. It is reform that will enhance their capacity to access finance and increase revenue. That is what local governments need.

The fact is that local government allocation is getting smaller and smaller and it cannot service the local government. Restructuring is the only way out. Like this month (May) for example, the allocation is reduced again, there is a shortfall and it means those depending on local government allocations will not have their salaries hundred percent. The states also have a shortfall but while we can augment our income from other sources, the local governments do not have such ways and means. And naturally you should understand that it is not easy for me to say am taking from states allocation to add up for local governments.

Those of you who checked my budget, the 2017 appropriation budget, you will see that there is no line of space for me to take money to add to any local government. There there is a need to alert the federal government that there is an imminent collapse in the local government administrative structure if the allocation continues to dwindle like this. It is either the federal government increases the ratios that come to them or create a window where they can access additional money added to what comes into the local government purse. Short of those two, it will be difficult for local governments to continue to rely on a federal allocation that also relies on the price of crude oil, which we also see as dwindling. It will continue like this for a while until there is a reform. The state cannot reform local governments, it has to be a federally directed reform and it will also involve constitutional amendment.

All this bickering and passing the bulk at the state government; that we are not paying local governments workers and pensioners are refusing to face the facts as they are and we are being economical with the truth and we are not helping ourselves. Some politicians are playing politics with the situation as a platform to make the government look bad as if the state is owing local governments, we are not owing local governments, we have never owed them. At the state level we have been able to meet our obligations as and when due. So each time I come out, I will continue to say it that Kwara state government is not owing local government workers. Our pensioners, workers and all those who draw remuneration from the state government cannot say we owe them. I cannot say same with the issue of local government because I don’t generate the allocation it will be difficult to defend the problem of insufficiency. Since I don’t dictate what comes in; I cannot defend whether it is insufficient or not. So the reform is what will change the revenue base of local government.

There are sixteen local governments and they are all owed at varying levels.’ Kaiama for example owes just one month and another local government owes just five or six months. In my honest opinion, the way local government is for now is not workable, that reform is essential.

How is your government supporting agriculture as a way of engaging the youths in the state?

I love these questions; you see, agriculture had been wrongly perceived by people as a government programme. Agric is a business and it has to be treated as such and that is why we have introduced the off taker demand driven agric scheme. It is designed to make the man who is starting at the primary level to be lifted up to the person who is going to off take whatever he is producing for value addition. For example, the man who is producing maize is already linked up to a feed-mill and this feed-mill too is already linked up to a poultry farm. That is the kind of scheme we have put in place. You will see a place there at the Ministry of Agric called Agric Mall; It s designed to be a one-stop shop where intending farmers can access input requirements. The first one you can access there is tractor hiring. A farmer is expected to hire tractor, government is not going to give it out free of charge and there are a thousand and one individuals that has tractors for hire. So if someone tells you he doesn’t see tractor, it must be that he doesn’t have money to hire one, they are available for hire. Currently, I also hire tractors to do my own farm. That is what we call agric, because it is business. Also to make funding easy, we have gone to the Central Bank of Nigeria to arrange for a credit scheme, Commercial Agric Credit Scheme, CACS, which is coming at 9 percent. This has been deigned to be available to intending farmers to borrow, use and pay back. That is why there is a lot of noise going on about CACS. We have asked those who sell herbicides to register with agric mall. Agric mall is the go in between, the tractor owner on one side and the person who wants to hire tractor on the other side; between the chemical seller and the user of chemical; between the farmer and the seed seller, that is how agric is run. Then government’s responsibility is to continue to crate subsidy which we have done by accessing a loan at 9 percent interest per annum, any serious farmer will take advantage of that. By this, we are taking our farming from subsistent level to commercial level. We also have extension work system tied to it at the agric mall. There is no excuse. In the past, people were used to a situation where government would just buy tractors and leave them on the ground and people would just come and pick the one to use. What has this translated into? Has it moved from 10,000 hectares to 20,000 hectares? The answer is no. It is so because in the past agric is seen as a social activity, but now it is seen as a commercial business. Those who want to key into it are those who want to create wealth from agriculture. They can recognize the input levels, they see the out puts and they can measure the impact.

With the different payments still being made in schools, can we still say that education is free in Kwara state?

Education is free in Kwara. It is the tuition that is free. The Okada you are riding from home to school is not free; the uniform to put on is not free, you have to make them. What government is supplying you, what you are paying for is learning, the tuition fee. That does not foreclose that all other things you need to pay for, which vary from school to school would also be free. The only two things that will be free is the tuition and the free meal that the federal government is working on. It is not all everything that is free, what is free is tuition fee. But among the teachers and the parents and the administration of the school if they agree that, ok tuition fee is removed, what else you have to pay for, they then agree among themselves with the parents teachers associations, on what they want to contribute to augment the education of their wards. So let it be understood from that angle.

Multiple taxation is said to be sending many companies out of Kwara.

There is nothing called multiple taxation in Kwara. In the past, people do not pay taxes; fees were highly compromised, commissions were hardly charged. When we say we moved our revenue from five hundred million to one billion five hundred million, not that we brought new taxes or new laws all we did was increase efficiency. In other words, those who were not paying taxes now begin to pay. Most factories are owing ground rents, so when you look into their records some of them are owing up to between nine to ten years. How can you be using a premise and not pay for it? So by the time you calculate and ask them to pay, they will say you are putting them under pressure but the truth is that they are asked to pay what they are owing. Some of them came to me and we even gave them waivers like asking them to pay three years out of ten so that they can move on yet they are still making noise on it. Those are the challenges, I must be frank and they come to me for waivers. I still have some waiver papers on my table now. On the issue of new taxes to be introduced, it is currently on the table of the state’s house of assembly so there should be no noise about it. It is undergoing public hearing, this is an opportunity for everyone to contribute. Whether you believe or refuse to believe it kwara state has a lot more enabling environment than most states you see in the south west. Comparing with Lagos, Lagos has more taxes than we have here and their drive for those taxes in uncompromising. How do you think they raise about twenty six billion every month? Those people who say they are going to Lagos know that they cannot go to Lagos because if they go there they will pay. We are a bit subtle here and we allow them enjoy some holidays. Only some days ago we gave tax holiday to some pioneer SMEs, only pioneers not all of them and we would ensure that they get it like that till they get to stability levels. After that they will begin to pay expected dues. I am not aware of any manufacturing company that left kwara because of taxes, there is none and there will be none because in all we do, we draw comparison to what is obtainable in other areas; none has left and none will leave on the bases of tax. Cocacola that left, it was strategic for them to leave. Their biggest challenge is energy; rather than manufacturing in Ilorin, Ibadan and every other place, they chose to concentrate in Ibadan and Ilorin to serve as a depot for distribution which is their business and you cannot tell them how they run their business.

Herdsmen and farmers clashed recently in a community in the state. What measures are you putting in place to make sure it does not happen again?

The herdsmen Issue has been reviewed very critically. We had a very extensive meeting with the representatives of the herdsmen, representatives of traditional rulers and that of the farmers and we all agreed that we need to cooperate within ourselves for us to get a peaceful environment. Part of the cooperation is that we have a Myeti Allah, which is a body that houses the cattle rearers. It is agreed that anytime there is an encroachment on any farm compensation would be extended and members will ensure that compensation is paid as and when due. On the strength of that you will see very little areas of differences. It means if your cow destroys a farm you will pay compensation. The only problem is that this is workable within our area, where we have cattle rearers from places like Mali, they may not know that we have a compensation arrangement on ground. This is where the Myeti Allah comes in, it is their responsibility to help us identify which one is from Mali and which one is our own because some of us cannot distinguish one from another. On the strength of that, they have promised to keep a tab on those areas so that straying cattle rearers are discouraged and those who live within us would rear their cattle in way and manner that their cattle will not stray into farmlands.

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There is a need to alert the federal government that there is an imminent collapse in the local government administrative structure if the allocation continues to dwindle like this. It is either the federal government increases the ratios that come to them or create a window where they can access additional money to what comes into the local government purse.