-By Fred Ojuegbe
Allegations of financial recklessness and corruption that have rocked the Niger Delta Development Commission (NDDC) in the past weeks have once again heightened calls for the federal government to overhaul many of its intervention initiatives established to address the perceived marginalisation and underdevelopment of the Niger Delta region.
President Muhammadu Buhari had in 2019 ordered a forensic audit of the operations of the NDDC from 2001 to 2019. The investigations so far, including another being carried out by Committees of the National Assembly to investigate all financially related allegations of misappropriation and breach of the extant procurement processes, have revealed how politicians and key officials of the Commission fed fat with funds that were meant for the development of the ordinary people of the oil-rich Niger Delta.
The Minister of the Niger Delta Godswill Akpabio, former NDDC Managing Director Joy Nunieh, current MD of the NDDC, Prof Kemebradikumo Pondei and key members of the House of Representatives Committees on NDDC have been locked in web accusations and counter-accusations of fraud, misappropriation and outright diversion of critical funds meant to better the lot of people in the region.
Valuechain findings based on the unfolding revelations from the probe of the Commission at the National Assembly may not support the age long argument advanced by the Niger Delta people that the federal government or any sub-regional government particularly the North could be responsible for the underdevelopment of the region.
Elites from the region have persistently blamed the paradox of poverty in the midst of plenty on the perceived lopsided distribution of Nigeria’s oil wealth, but findings so far shows that the underdevelopment of the region may not be unconnected with the systemic corruption that has almost become a subculture among individuals and agencies entrusted with managing and redistributing the wealth of the region.
Suffering amidst Plenty
It has been well established that geographically, the Niger Delta is in the central part of Southern Nigeria or the south-south geopolitical zone of the country. The main oil-producing states in Nigeria, are located in the core of the south-south zone of the country and the region, according to the National Bureau of Statistics (NBS), accounts for more than 90 percent of earnings from oil and gas, 80 percent of gross domestic product (GDP) and 95 percent of the national budget of Nigeria.
A scholar, Dele Babalola in a paper, “The Underdevelopment of Nigeria’s Niger Delta Region: Who is to Blame?” published by the Canadian Centre of Science and Education, wrote that a striking feature of the Niger Delta is that decades of oil exploration in the area have resulted in monumental environmental degradation, which has in turn adversely affected the economic life of the people who are predominantly engaged in farming and fishing for their livelihood. The negative effects of oil spills, water pollution, gas flaring, and construction of refineries, petro-chemical plants and pipelines, on the environment, as well as on the local inhabitants have been well documented by several scholars.
Another striking feature of the oil-rich region is youth unemployment. Most youths have become unemployed following the destruction of their farmlands as well as pollution of available rivers. Unfortunately, these young men and women have found it difficult to get jobs in the oil industry due to the capital-intensive nature of the industry. Multinational oil companies are usually reluctant to employ local people on the ground that they lack the required skills.
A report titled “Regional Inequality and the Niger Delta, Policy Brief No 5” prepared for the World Development Report 2009, found that despite fuelling much of Nigeria’s economic growth, the Niger Delta is somewhat marginalised from Nigeria’s national development. Essentially, while the Niger Delta produces oil wealth that accounts for the bulk of Nigeria’s foreign earnings, these vast revenues have not translated into improved human development outcomes for the Niger Delta population.
Interventionist Agencies to the ‘Rescue’
Findings showed that effort on the part of the Nigerian state to redress the deep-seated underdevelopment that characterised the region has led to the framing of special development programmes, since the country’s independence in 1960.
Some of these programs include the establishment of agencies such as the Niger Delta Development Board (NDDB) in 1960, the Niger Delta Basin Development Authority (NDBDA) in 1976, the Oil Minerals Producing Areas Development Commission (OMPADEC) in 1992, the Niger Delta Development Commission (NDDC) in 2000, and the Ministry of Niger Delta Affairs in 2008.
Details of this interventionist schemes showed that OMPADEC, which succeeded a Presidential Committee, was created by Decree No.23 of 1992 during the federal military regime of Gen. Ibrahim Babangida (1985-93), to address the development problems of the Niger Delta. The fundamental objective of the Commission was among others to see to the rehabilitation and development of oil-producing areas, tackling of ecological problems that have arisen from the exploration and exploitation of oil minerals and embark on the development of projects properly agreed on with the local communities of Oil Producing Areas. OMPADEC was succeeded by the present NDDC with the enactment of the NDDC Act in 2000. The NDDC was given the mandate of facilitating “the rapid even and sustainable development of the Niger Delta to a region that is stable, ecologically and politically peacefully”.
According to the NDDC Act, the Commission is expected to be funded with :(i) Federal Government contribution of equivalent of 15% of monthly statutory allocation due to Niger Delta state; (2) 3% of total budgets of oil and gas producing companies; (3) 50% of ecological fund due to Niger Delta states; (4) Aid, e.t.c.
From these sources, the commission was said to have received approximately four trillion Naira in the past two decades. Available records reveal the following accruals between 2007 and 2016: 2007 (N64.721 billion); 2008 (N84.790 billion); 2009 (N141.575 billion); 2010 (N135.097 billion); 2011 (167.778 billion); 2012, (N140.605 billion); 2013, (N149.352); 2014, (N207.553); 2015, (N140.512) and 2016, (N181.637 billion).
BudgIT, Nigeria’s civic tech organisation involved in transparency, citizen engagement and accountability activism, in a report in 2019 said: “Since inception in 2000, NDDC has received at least $40bn (N15 trillion) for projects in oil-rich.”
Furthermore, in terms of direct revenue, the oil-producing states have had their share of national oil-generated revenue increased by 13% since 1999, when the principle of derivation was reintroduced into the country’s revenue-sharing formula. In Nigerian context, derivation means that, in addition to the regular federal statutory transfer, some proportion of the revenues collected from a federating unit should be returned to the government of that unit.
Therefore, the states of the Niger Delta were, in addition to the statutory allocation from the centre, entitled to 13% from Nigeria’s oil revenue. Thus, the application of the derivation principle has resulted in a situation in which the oil-producing states have become richer than the non-oil producing ones. Without a doubt, the Niger Delta region benefits immensely from the country’s revenue-sharing system compared with other regions.
To buttress this point, for instance, the Nigeria Extractive Industries Transparency Initiative (NEITI) report on disbursement to the Federal, States, Local Governments by the Federation Accounts and Allocation Committee (FAAC) in 2019 showed that four states of the Niger Delta Region were among the big league of states that received over N100 billion out of the N8.15 trillion shared in 2019 owing largely to the 13 per cent derivation.
According to NEITI, Bayelsa received N139.69 billion, Rivers N158 billion, Akwa Ibom (N171.43 billion) and Delta (N218.58 billion). NEITI stated in the analysis that while Osun State had the lowest share of N24.14 billion, Delta State had the highest of N218.58 billion. This implies that the Delta States received over nine times the amount that Osun State received.
Another way the Nigerian central government responded to the plight of the people of Niger Delta region was through the creation of the Ministry of Niger Delta Affairs. The ministry was created in September 2008 during the late President Musa Yar’Adua’s administration (2007 – 2010) to support the developmental efforts of the central government and that of the multinational oil corporation in the region.
How Corruption is Crippling Interventions
Endemic corruption has been at the root of many of the region’s problems. The pervasive corruption in the region is merely a reflection of the systemic and wide spread political corruption that has characterized the Nigerian State.
OMPADEC reportedly failed to achieve its objectives due to allegations of corruption, mismanagement and in-house squabbles. The Commission was entangled in financial imprudence, contract proliferation and ultimately, maladministration. Massive corruption and maladministration was seen as the bane of the establishment. The reason being that contracts were massively inflated, and full payments were made for shoddy or simply non-existent jobs. Several independent reports found the shoddy performance of OMPADEC. Thus, by and large OMPADEC failed to actualize its mandate.
It is important to note that the NDDC was established as a response to the failure of the OMPADEC, but just like the other agencies before it, it also become a conduit through which a few individuals within the oil-producing region enriched themselves.
Valuechain investigations showed that despite the trillions of Naira that accrued to the NDDC, the consensus among stakeholders is that there is little to show for it in the region. Contracts were said to be awarded, and in most cases, at inflated prices to traditional rulers, retired military officers and other people close to the corridors of power. The amazing thing is the youths of that region are blindfolded with propaganda by these elites to believe that it was other regions, particularly the north that is blocking their development.
In the course of the recent probe of the NDDC, its Executive Director, Projects, Dr. Cairo Ojougboh in an interview with journalists said that in the period of seven months in 2019, a total of 1,921 emergency contracts valued at N1 trillion was awarded. According to him, “It is now common knowledge that some of the awards were not only spurious, but criminal as records available to us show that most of the awards were not backed by budget, have any bills of engineering measurement or drawings and were just open cheque for contractors and their collaborators to fill in at the nearest banks.”
In essence, whereas the NDDC have performed better than previous intervention agencies in that region, it has equally failed to bail the region out of the fog of underdevelopment.
The Ministry of the Niger Delta was created to augment the NDDC and to provide development in the region, but still no tangible achievement has been recorded.
The other levels of government in the Niger Delta: States and local, on the other hand, have also not been able to drive the much needed development in the region. The states complain of inadequate statutory financial allocations from the Federation Account to fund developmental projects. Nevertheless, corruption and financial recklessness have also dampened the development prospect of the Niger Delta by the various state governments in the region. Some states that have collected over N600 billion since 1999 have nothing to show for the huge money.
Summing up the performance of the various intervention agencies vis-a-vis the funds made available for the development of the region, immediate past Minister of State for Petroleum Resources, Dr. Ibe Kachikwu in August 2016 concluded that there was nothing on ground to justify the over $40 billion that accrued to the Niger Delta region in over a decade.
The minister said the $40 billion came mainly from oil companies, NDDC, 13% derivation and other intervention funds, stating that the state of infrastructure was disappointing despite the huge effort to alleviate the infrastructural defect in the region.
“The Niger Delta has become a region with a cacophony of all kinds of projects. If you look closely from the past 10 years, up to $40 billion has been made available for that region and you can never tour the Niger Delta and see an N1 billion or a N500 million investment, but I am telling you, collectively, for the past 10 years, that was what has gone into that region,” he said.
The minister re-emphasised that $40 billion had been invested in 11,000 projects in the region over the last 10 years without concrete evidence.
Speaking further, he said: “If you check them, for instance, the NDDC has close to 11,000 contracts. With these contracts, mostly owned and held by people from the region, then you can understand that we are the ones undoing ourselves, for not implementing those projects.”
Valuechain reports that the consequence of the failure of these interventions is that instead of the federal government’s efforts at engendering more humane conditions of life for the people of the region, they have become more susceptible to underdevelopment than they were five decades ago when the exploration of oil commenced in the region. The region has continued to rank very low in all the known indices of development. Life expectancy is low, infant mortality ranks high, malnutrition is widespread, infrastructure is in shambles and health prospects are poor. In addition, social institutions have collapsed, illiteracy level is high, unemployment is widespread, so also are ignorance and political apathy. The deplorable conditions of life in the region have left a large part of the people of the region especially the youth with a siege mentality. The youth has virtually taken over the region as a formidable group and hostage taking, kidnapping are constantly thriving. No doubt, the Niger Delta development issue has become one of the greatest single threats to the peace, stability and socio-political cohesion of the Nigerian State. The unresolved question is; why have the several state interventions not translated the immense resources of the region into enhanced quality of life for the people?
From recent revelations from the ongoing probe of the NDDC, it seems reasonable to suggest that the main factor responsible for the gross underdevelopment of the area is not about the President Buhari, the North or the proportion of the centrally generated oil revenue going to the area or a lack of revenue, but about how the funds allocated have been utilised by the local and state governments, agencies and people from the region entrusted with the funds.
