ACTIVITY 5: START UP PROGRAMME ESTIMATE

ANALYSES OF CROSS RIVER STATE DEVELOPMENT MODEL: ITS SUSTAINABILITY AND RESPONSIVENESS TO CROSSCUTTING ISSUES OF GENDER, POVERTY, ENVIRONMENT AND SOCIAL WELFARE.

FINAL REPORT

Submitted By: Dr. Uwem Essia 08035500591 [email protected] (Consultant)

To: The State Coordinator Support to Reforming Institutions Programme (SRIP) Cross River State

2006 TABLE OF CONTENT Acknowledgements ………………………………………………………………………1 Executive Summary……………………………………………………………………. .. 4 CHAPTER ONE: INTRODUCTION 1.1 Preamble…………………………………….…………………………………..……6 1.2 The Research Problem…………………….………………………………………….8 1.3 Objective of the Assignment…………….…………………………………………...9 1.4 Method of Research…………………….…………………………………………. 9 1.5 Significance of the Assignment……………………………………………………...10 1.6 Organization of the Report………………………………………………………….. 11

CHAPTER TWO: FRAMEWORK FOR MODELING DEVELOPMENT IN CROSS RIVER STATE 2.1 The Perspective of Modern Development…………………………………………...12 2.1.1 The Cultural Economy of Modern Development………………………………….13 2.1.2 Components of a Sound Development Model for Cross River State……………. 14 2.2 Structure of a Development Model…………………………………………………...15 2.3 The Cross River State Development Model………………………………………….16 2.3.1 Government Intervention and Model Outcomes…………………………………...17 2.4 Funding Development in Cross River State………………………………………….18

CHAPTER THREE: REVIEW OF SEEDS DOCUMENT 3.1 NEEDS and the EC Donor Strategy ………………………………………………21 3.1.1 Macroeconomic Framework of NEEDS…………………………………………22 3.1.2 Sustainability and Responsiveness of NEEDS/CR-SEEDS to Crosscutting Issues of Gender, Poverty, Environment, and Social Welfare……………………………………………………… …………………………22 3.1.3 EC (Donor) Strategy and NEEDS……………………………………. …………26 3.2 SEEDS as a Development Strategy…………………………………………………28 3.2.1 General Assessment of CR-SEEDS………………………………………………31 3.3 Challenges of Development in Cross River State…………………………………..33

CHAPTER FOUR: COORDINATION OF DEVELOPMENT PARTNERSHIP PROGRAMMES IN CROSS RIVER STATE 4.1 Lead State/Donor Partnership Initiative…………… ………………………………37 4.2 Coordination of EC Activities in Cross River State… ………………………….39 4.2.1 Shared Values of all EC Projects…………… ………………………………… .41 4.2.2 Proposals for Cooperation among EC Partners in the State………………………41

CHAPTER FIVE: REFORMS OF THE BUDGET PROCESS IN CROSS RIVER STATE 5.1 Anatomy of the Budget Process…………………………………………………….43 5.2 Budget and Planning Institutions: Proposals for Support for Reforming Institutions Programme………………………………………………….…………………………...45 5.2.1 State Planning Commissions …………………………………………….46 5.2.2 Budget Office……………………………………………………………………...49 5.2.3 Ministry of Finance………………………………………………………………..50 5.2.4 Office of the State Accountant-General………………………………………….51 5.2.5 Office of the State Auditor General………………………………………………51

1 5.2.6 Office of the Auditor-General for Local Government……………………………52 5.2.7 The State House of Assembly …………………………………………………53 5.2.8 Office of the Head of Service …..…………………………………….54 5.2.9 Ministry of Local Government Affairs……………………………………… ….55 5.2.10 Selected Local Government Areas……………………………………………….55 5.2.11 Proposal for Reform of Local Governments………………………… …………57 5.2.12 Civil Society Organizations ………………………………… ……58 5.2.13 Ministry of Women Affairs and Social Development …………… ………….59 5.2.14 Mainstreaming Gender and Concerns for Disadvantaged Groups …… ……….60 5.2.15 Water and Sanitation Sectors (Rural Water Supply and Sanitation Agency) ……61 5.2.16 Proposed Reforms in the Water and Sanitation Sectors… ……………………..63 5.3 Selected Related Service Institutions 5.3.1 Ministry of Health………………………………………………………………… 64 5.3.2 Ministry of Education……………………………………………………………. 65 5.3.3 Tourism Bureau………………………………………………………………… .65 5.3.4 Ministry of Agriculture ……………………………………………………… 66 5.3.5Management Development Institute………………………………… …… …...67

CHAPTER SIX: SRIP/CRS PARTNERSHIP: COMMITMENTS, RISKS, CONSTRAINTS, AND EXPECTATIONS 6.1 SRIP’s Commitment to its Partners………………………………………………..68 6.2 Risks of SRIP Partnership………………………………………………………….68 6.3 Constraints of SRIP Partnership……………………………………………………69 6.4 Expectation of SRIP Partnership………………………………………………… . 69

CHAPTER SEVEN: SUMMARY OF MAJOR FINDINGS, RECOMMENDATIONS, AND CONCLUSION 6.1 Summary of Major Findings………………………………………………………71 6.2 Recommendations for Revising Existing Development Models………………….71 6.3 Conclusion…………………………………………………………………………72

Appendix I List of Acronyms ……………………………………………………………………..72 Appendix II List of Persons Interviewed……………………………………………………………74 Appendix III List of Tables…………………………………………………………………………..76 LIST OF TABLES Table 1 Analysis of Consolidated Financial Statement (1999-2004)………………..19 Table 2 Nigeria: Selected Indicator of Macroeconomic Performance (2004)……. ... 26 Table 3 Development Partner Activities in Cross River State (by NEEDS Pillars)…38 Table 4 Proposal for Reform of State Planning Commission………………………..48 Annexures Annex I………………………………………………………………………………..76 Annex II……………………………………………………………………………….77 Annex III……………………………………………………………………………. 78 Annex IV………………………………………………………………………………79 Annex V……………………………………………………………………………….80 Annex VI………………………………………………………………………………81 Annex VII……………………………………………………………………………...82 2 Acknowledgement

The efforts of several individuals, groups and government departments went into the preparation of this report. It would be difficult to mention all of them. A few however must be mentioned. The most deserving Mr. Afzal Yearoo, whose leadership, vision and commitment to his job as State Coordinator of SRIP provided the leadership and support required for success in this assignment. Afzal displayed an inestimable commitment to this assignment. In addition, his earlier report on the Institutional Needs Assessment provided the lead that made the task of this assignment much easier to accomplish. The support, comments, and wise counsel of Mrs. Margaret Ebokpo, Deputy State Coordinator, SRIP were equally helpful. The other employees of SRIP – Jenny and Prince offered one assistance or the other and are here acknowledged.

The Vice Chairman and Secretary of the State Planning Commission, Ntufam John Omori and Mr. Charles Achu supported the assignments with their valuable insights and experience of the development process in the State. Equally helpful were the contributions of Chief Budget Office, Mr. Josephat Oga, and Permanent Secretaries of Ministries of Local Government Affairs, Finance, Agriculture, Education, Health, Environment, and Trade and Investment. Equally, the State Tourism Bureau, Tinapa Project Office, Forestry Commission, Internal Revenue Service, and Office of the Head of Service provided valuable inputs.

Officials of the focal Local Government Areas visited; Boki, Yakurr, and Odukpani were on hand to provide information that was fully described their budgeting procedures and those of the remaining two – Obubra and Etung.

Inputs were also obtained from the Strategy Papers of EC and other Donors. The NEEDS, CR-SEEDS and LEEDS documents, Consolidated Accounts of Cross River State, and SEEDS benchmarking exercise report of 2005, served as the main working documents. A book, Contemporary Approaches to Public Budgeting by Fred A. Kramer (Winthrop, Cambridge, 1979) provided a lot of insight on the proposed framework for budgeting and policy programming. The consultant equally benefited from his numerous publications experience in knowledge and neo-technology economics, and human development – his current areas of research interest.

The contribution, inputs, and views of others notwithstanding, the consultant takes personal responsibility for content, possible errors, and conclusions that are contained in this report.

3 Executive Summary

This assignment, Activity 5: Start Up Programme Estimate, Analyses of Cross River State Development Model: Its Sustainability and Responsiveness to Crosscutting Issues of Gender, Poverty, Environment and Social Welfare, was meant to provide background information to guide SRIP intervention initiatives in Cross River State.

The global objective of this assignment was to conduct an analysis of the state development model, assessing its sustainability and responsiveness to crosscutting issues of gender, poverty, environment, and social welfare.

The vision of CR-SEEDS is to make Cross River State the most prosperous state in Nigeria. The major development goals of the state are poverty eradication and job creation, tourism development, and growing the private sector. The state has identified tourism, agriculture, and infrastructural development as the lead activities and sectors. Notwithstanding the tremendous achievements recorded so far, a lot more still needs to be done to improve the living conditions of the poor and make development sustainable. There is hope, however, that current investments in tourism, infrastructural development, and agriculture will soon yield dividends to place the State first in the ranks of states in Nigeria.

Realizing the vision and hopes of tourism and agricultural development calls for continuity and steadfastness in the key development and social transformation projects. So far it would appear that successes recorded are largely dependent on the self-will and personal drive of the indefatigable Governor Donald Duke whose tenure as Governor expires in May 2007. Continuity and sustainability demands that the engines of development and social change be placed on capacities, incentives, and institutions, rather than the efforts and drives of any single individual.

Budgeting and public finance capacities, incentives, and institutions are key requirements for good governance and sustained socio-economic progress. But poor funding, weak capacities and motivation for research and planning, and lack of working materials and equipments have weakened budgeting and public finance management in the state.

SRIP comes handy as an intervention initiative to complement the state’s efforts at ensuring budget transparency and accountability, through its intended support for implementation of CR-SEED with equipments, information technology, linkages, logistics, and training.

The specific objectives of this assignment were to: • Identify government partner institutions in Cross River State, and carry out institutional needs assessment so that training programmes can be designed, equipment tenders prepared, and so on. • Make recommendations on revising existing development model wherever found unsustainable or lacking a comprehensive policy framework encompassing the NEEDS/SEEDS/LEEDS. • To assess the model’s ability to address identified population needs.

4 • Assess the model’s sustainability and responsiveness to crosscutting issues of gender, poverty, environment, and social welfare.

It was found that the Cross River State House of Assembly (SHA), Budget Office, State Planning Commision (SPC), State Accountant-General, State Auditor-General, Auditor- General of Local Governments, Heads of Accounts and Audit in the line ministries and focal LGAs (Odukpani, Etung, Yakurr, Boki, and Obubra), Ministry of Local Government Affairs, Office of the Head of Service, and Planning, Research and Statistics Departments in all ministries and agencies, are the major SRIP institution partners.

It was found also that all SRIP partners urgently need basic office facilities, functional computers, photocopiers, filing cabins, and motor vehicles. Training needs differ in each case, but relate generally to capacity to formulate, implement, monitor and appraise budgets, track public finances, and use the relevant computer software to aid their jobs. All partner institutions expressed desire to be hooked to a statewide website and information bank, and the envisaged Internet and Intranet connectivity.

The report is presented in seven chapters. Chapter one is the Introduction. Chapter two presents the Framework for Development Modeling in Cross River State. Chapter three reviews the CR-SEEDS document, while Chapter four discusses State/Donor Partnership Coordination. Chapter five examines Budget Institutions and the Budget Processes in Cross River State. Chapter six outlines the commitment, risks, constraints, and expectations of SRIP in the State. The last chapter, Chapter seven is summary of major findings, recommendations for review of the state development model, and conclusion. Appendix 1 and 2, and the Annexure contain the list of acronyms, and list of persons interviewed, and diagrammatic presentations of components of the state development model, respectively.

5

CHAPTER ONE

INTRODUCTION 1.1 Preamble The present Cross River State was created in 1987 when Akwa Ibom State was carved out of the former Cross River State. The state has an estimated population of 2.75 million people, and is situated within the South-South zone and Niger Delta region of Nigeria. The geographical area of the State is located within three vegetation belts of mangrove swamps, tropical rain forest, and savannah. The people of Cross River State have diverse cultures and local languages. But Pidgin English is widely spoken in the State.

The state has diverse mineral, agricultural, and forest potentials that can make her development self-sustaining. But Cross River State (CRS), like the rest of Nigeria, had its fair share of prolonged years of military rule; the years of slow growth, high rates of poverty and unemployment, and decaying infrastructure for basic health, education, transportation, electricity and water supply, security, and communication.

The Donald Duke led administration has since inception in 1999 taken steps to readdress the major causes of economic stagnation, poverty and ignorance, unemployment, and poor living conditions. The framework for economic management in the state is the Cross River State Economic Empowerment and Development Strategy (CR-SEEDS).

CR-SEEDS is the state-level derivative of the National Economic Empowerment and Development Strategy (NEEDS), which basically aims at growing the private economy, employment generation, poverty reduction, and ethical reorientation. Although CR- SEEDS was launched in 2004, its motivation and guiding principles informed activities of the Donald Duke led administration since its inception. Governor Donald Duke inherited a post military economy that was weak in policy orientation; with little concerns for budget discipline and development planning.

Understandably in the military era, separation of powers was weak; the executive arm swallowed up legislative functions, and the two were hardly separated. The judiciary remained a weak appendage of the powerful executive arm. With limited checks and balances, arbitrariness and ad-hocism loomed large, and a general lack of concern for government business was habitualized in the public service. Secrecy and absolutism in the fiscal operation of government became best place practices. Civil Society Organizations (CSOs) were denied the opportunity to criticize how public funds were used. Scientific research and planning came second place to guesses and conjectures. The price for these official mishaps were policy failures, budget abandonment, and intensification of poverty. Years of military rule have passed, but old habits they say never die; the public service and politicians would need to unlearn the habit of militarism. This is why reform of the budget process in Cross River State is essential.

With the resumption of democratic rule in 1999, the principle of separation of powers as provided for the constitution of the Federal Republic of Nigeria separated the three arms 6 of government at the federal, state, and local government levels. In addition to its law making function, the State House of Assembly has the constitutional mandate to appropriate state budgets, and control and monitor public spending. Success in achieving the goals of transparency and accountability lies largely on the capacity of the SHA to perform these very important tasks.

Determined to reverse these unhealthy trends, and re-engineer the public service for transparency and accountability, the democratic government of Governor Donald Duke, right from inception in 1999, set out to implement widespread reforms in the planning and implementation of government policies and programmes. Some of the major reforms implemented in the Cross River State public service since 1999 include:

• Creation of the State Planning Commission (SPC) as the distinct department responsible for coordinating medium- and long- term planning. The Planning, Research, and Statistics (PRS) departments in the line ministries serve as desk offices and data collection points for the SPC. The SPC is also responsible for coordinating the activities of development partners and donor agencies. The Governor is Chairman of the SPC Board.

• Creation of the Budget Office as the agency responsible for the preparation, monitoring, and appraisal of annual budgets. The Budget Office equally houses the Tender’s Board, and the Budget Monitoring and Price Intelligence Unit (Due Process).

• Centralization of public finances to ensure that the Governor as the State’s Chief Executive Officer is directly involved in the fiscal operation of government.

• Centralization of payment of Local Government Councils’ staff salaries.

These and several other reforms have repositioned the state public service for more purposeful service, prudence and transparency. Among the benefits of the above reforms are the following:

Y The creation and strengthening of SPC and the Budget Office have aided to institutionalize the planning and budget culture, by drawing the thinking of public servants to accountability, transparency and prudence in the affairs of government.

Y Centralization of state finances has reduced to the barest minimum all possible forms of misuse and abuse of public funds in the line ministries, self-accounting departments, and agencies. Cases of ‘ghost workers’ that were common in the past have ceased to be a problem.

Y Public servants in the state service and local governments now receive their salaries as at when due. Situations where funds meant for salaries are misappropriated no longer exist.

Despite the numerous achievements of the Cross River State government since 1999, a number of development challenges still require urgent attention:

7 ./ Revenue base of the state is still low. This limits the state’s capacity to successfully implement its laudable development programmes. The state is dependent heavily on its earning from the federation account. Internal revenue generation is hampered largely by slow growth in the private sector.

./ The state is saddled with a large public service that it would rather wish to downsize. But government is perhaps reluctant to downsize because the private sector has not grown enough to absorb a sizeable proportion of the unemployed that mass retrenchment in the public service would create. Besides reduction in unemployment is a core goal of the administration. Downsizing the workforce now could compound existing problems of development in the state. Growing the private sector is therefore a necessary requirement for rightsizing the public service.

./ Implanting the culture of accountability and transparency is a costly business. Sound planning and budgeting require capacity building in project evaluation, operations research and management, model building, forecasting and simulation, and so on. These call for training and retraining, and attractive remunerations to ensure that trained personnel are retained. The capacities to engage in varying types of researches are equally essential. There is also need to create and maintain laws, procedures, and reporting formats that sustain transparency and accountability systems as going concerns. Success in these endeavours requires information and databases that are expensive to create and maintain. The machinery and facilities for data collection and basic research in the SPC, Budget Office, local governments, and line ministries are weak and grossly inadequate. Government would need to allocate more funds for planning and research in the state.

It is in the light of these and other challenges that this European Community initiative; Support for Reforming Institutions Programme (SRIP) comes handy as a package of (grant) assistance to aid Cross River State achieve its development goals efficiently.

1.2 The Research Problem

SRIP plans to achieve two main results:

1. Transparent budgeting processes that take account of past experiences, reflects the political priorities identified through political debate, and serves as a binding guide to their implementation, using the prudently estimated resources available.

2. Citizens who through Civil Society Organizations can participate effectively in the budget process, highlighting cases of corruption and business crimes.

Intended outcomes of SRIP interventions are essential for ensuring that Cross River State succeeds in its development drive. First, transparent budgets would ensure that scarce funds of the state are allocated for the benefit of the people, and not at the whims and caprices of a few advantaged persons.

8 Second, open budget systems promote accountability and prudence because people have very little to hide. It is wrong to expect that people would do the right thing when they are not ‘inspected’, and monitored by others. Taking advantage of secrecy in public finance management to make money for oneself may be consistent with rational human behaviour.

Third, involvement of CSOs in budget work will on the one hand compel them to seek more relevance by championing citizens’ rights; on the other hand, it will prompt government and the legislature to avoid criticisms by sticking to programmes and policies that affect the electorate positively.

It is necessary to determine the specific support that stakeholders in the budget process would require to perform their respective roles effectively and efficiently. Such an infrastructure of information can be determined from an examination of the state development model to identify constraints that stakeholders face. How such constraints inhibit their capacity to work well, and what SRIP can do to eliminate some of them, is the thrust of this assignment.

1.3 Objective of the Assignment

More specifically, the main objective of this study is to analyze the state development models, assessing their sustainability and their responsiveness to crosscutting issues of gender, poverty, environment, and social welfare.

The specific objectives are to:

• To identify budget institutions in the state and local government councils, and carry out institutional needs assessments so that training programmes can be designed, equipment tenders prepared, and study proprammes launched. • To make recommendations on revising existing development models wherever found unsustainable or lacking a comprehensive policy framework encompassing the NEEDS/SEEDS/LEEDS main components. • To assess the model’s ability to address identified population needs. • To assess the model’s sustainability and responsiveness to crosscutting issues of gender, poverty, environment, and social welfare.

1.4 Method of Research

The assignment was divided into four main parts as follows: • Provide a framework for building the state development model.

• Analyze components of the state development model in the light of objectives of the assignment.

• Analyze appropriateness of CR-SEEDS as the strategy for achieving the model goals.

• Based on interviews and discussions with key personnel in budget agencies and departments, recommend possible reforms and support SRIP can offer in each case.

9 Interviews, group discussions, and examination of official records were the major means of obtaining information for the assignment. Analyses were mainly qualitative and descriptive.

1.5 Significance of the Assignment

Budget discipline and transparency in the budget process would ensure that available funds are used appropriately to meet the people’s development priorities. Donor agencies, foreign investors, and other development partners would be more willing to support CR- SEEDS when the budgeting processes are more creative, transparent, and visionary. Enlisting the support of foreign development partners is essential because of their capacity to support development programmes. Scarcity of funds equally makes efficient allocation of resources a necessary requirement for success in the conduct of government business.

Development experts, particularly of the structuralist school, have traced the above incapacities to existence of structural bottlenecks, rigidities, and distortions that are attributable to institutional failures and corruption. Such failures are in the form of market and policy failures. But there is a growing consensus, in development economics, that policy failures are more perverse. This makes reforms of policy institutions and capacity building in governance vital for the success of development programmes like CR-SEEDS.

In Nigeria, policy failures are generally associated with decaying policy-making and budgeting institutions, poor commitment to development goals, and non- institutionalization of democratic values. These incapacities make sundry corrupt practices, embezzlement, and diversion of public funds both easy and very difficult to check. A clumsy budgeting process and lack of transparency compounds the problem by making it difficult to know how to apportion blames.

With clearly defined policy implementation and budgeting framework, management of public finances and execution of development projects are much easier to appraise and monitor. Weak budget processes, by making diversion of public funds difficult to dictate, make attainment of development goals impossible. When the budget process is transparent CSOs are able to appraise government programs. A closed budget process alienates the people from government. Even the best intentions of government can be mis-understood in the process. These are the major challenges that CR-SEEDS faces at present.

Government failures are among the major problems that the Economic Commission for Africa (ECA) is addressing in recent times. The ECA identifies, among other issues, that productive participation and partnership among stakeholders is necessary for “fulfilling Africa’s drive toward growth and prosperity”. The problems posed by poor participation in governance in Africa were explored at the “Third Meeting of the Committee on Human Developments and Civil Society (CHDCS) organized by the Development Policy Management Division (DPMD) of ECA in May 2005, in Addis Ababa, Ethiopia. The meeting agreed on the following, among others:

• Financing the development process entails a participatory budgeting process that requires widespread consultations with CSOs and other stakeholders. • More PPP arrangement is required in public service delivery, especially with regards to water supply and sanitations. 10 CR-SEEDS have so far achieved some success in PPP arrangements, but budgeting process are yet to be fully participatory and transparent. This makes SRIP timely and its success essential to the overall success of CR-SEEDS.

This report is of immense value to SRIP and all its stakeholders and development partners. Development experts with interest in Nigeria, and Cross River State in particular, should find this report quite informing. The development model can, with minor modifications, be extended to explain the development processes in other states in Nigeria.

1.6 Organization of the Report

The report is presented in seven chapters. Chapter one is the Introduction. Chapter two presents the Framework for Development Modeling in Cross River State. Chapter three reviews the CR-SEEDS document, while Chapter four discusses State/Donor Partnership Coordination. Chapter five examines Budget Institutions and the Budget Processes in Cross River State. Chapter six outlines the commitment, risks, constraints, and expectations of SRIP in the State. The last chapter, Chapter seven is summary of major findings, recommendations for review of the state development model, and conclusion. Appendix 1 and 2, and the Annexure contain the list of acronyms, and list of persons interviewed, and diagrammatic presentations of components of the state development model, respectively.

11 CHAPTER TWO

FRAMEWORK FOR MODELING DEVELOPMENT IN CROSS RIVER STATE

In this chapter the framework for modeling the processes and requirements for development in Cross River State is outlined. The modern perspectives on development are also discussed. Development, as conceived here, encompasses material and intellectual dimensions. Poverty is not merely the lack of basic needs of life, but more importantly incapacities arising from lack of appropriate technological knowledge and technical skills to function well and utilize emerging opportunities.

2.1 The Perspective of Modern Development It is now clear to development experts that development in the broadest sense is improvement in the quality of lives and thinking of people. Over the years development economics has moved human kind closer to achieving the better quality of live, through the contribution of important research and ideas. The general focus has been on how to improve the living conditions of citizens through improved health, education, food, water supply and sanitation, housing, and communication.

There is also growing concern for increasing peoples’ creative capacities, particularly the capacity to participate actively in governance. This underscores the critical rule that technical skills and technological knowledge can play in today’s economies that are dominated by cultural and mental products, such as information, core competences, and knowledge.

Development is no longer reckoned only by the amount of foreign exchange, GDP, foreign reserves, or stock of natural resources that a state, region, or country has; what is paramount now is the people’s capacity to innovate and meet their needs as they arise from time to time.

Modern development thinking is therefore not just about subsidized food, shelter, and clothing for those described as the ‘poor’. Poverty is now understood more as incapacities arising from lack of knowledge and skills, and opportunities. People are primarily poor because they lack the capacity to take advantage of existing opportunities to improve their living conditions creatively.

It is still legitimate to be concerned with provision of basic material needs, but it is more important to understand that the individual needs capabilities (and opportunities) to participate in governance and independently pursue economic activities. It is important for development that the individual be empowered with the relevant capacities (appropriate skills and knowledge), incentives (opportunities to apply skills and knowledge), and institutional contrivances which ensures that the system rules are fair to all and promote the social good.

Associated with the growing dominance of knowledge and skills in the modern development consciousness is the globalization of information technology. The world is fast becoming an information village that is propelled by cultural products. Structures of the industrial age; such as the traditional factors of production – land, labour, and capital are loosing their places and importance to information technology, knowledge and technical skills. 12 The conventional trade theories that focus on factor endowments and comparative labour costs have become obsolete; what matters more, now, are differences in knowledge and skills. A country’s comparative advantage is determined by her technological competence, and ability to export new technologies to other countries. The major investments that matter more relates to the mass production of cultural goods; information, representation, linkages, and core competences that affect the organization of labour and production, and influences systematically the society and its cultures.

The growing unity of the economy and culture is a major defining feature of the current development consciousness. In this wise, eco-tourism and its related goods and services, and agriculture (with herbal health products) have emerged as leading economic sectors with limitless potentials for generating huge earnings for societies that are able to develop them. The focus on the tourism and agriculture as flagships for development in Cross River State is thus in line with current global development trends.

2.1.1 The Cultural Economy of Modern Development

Culture is a social system of adaptation of a group to its environment. Such adaptation includes the capacity to extract from the natural habitat what is necessary to sustain lives, and produce commodities for export. These and other aspects of culture namely, economic organization, political institutions, worldview, art, and so on, can be developed only within the limits set by the production technology.

Cultural changes are therefore dependent on the relationship between the natural habitat and the technology for harnessing its potentials. The poorer a people’s culture is, the more rudimentary is its technology, and the greater would be its level of import dependence.

Economic development in the context of the emerging global cultural context is improvements in the state of the natural habitat and in the utilization mechanisms arising from the application of scientific knowledge and technical skills for sustainable productive endeavors. The creative potentials in man are therefore the major endowments that should continually be developed.

The creativity process is initiated when new ideas are received as dreams, intuitions, reflections, or discoveries. The unconscious mind is as deeply involved, as is the conscious mind. No creative impulse, inner urge, or impression can be separated from the emotional, cultural and intellectual content of the creator; the more informed and enlightened (or empowered) an individual is the sharper and realizable are his/her creative thoughts. Economic development is achievable as more people are empowered with skills and knowledge that enables them to utilize their productive potential optimally, and in ways that ensures sustainability of the natural habitat. Sustaining the natural habitat is essential because several natural endowments are exhaustible capital assets: exploitation without conservation is not sustainable.

Since creativity is of the inner self, no one can impose or force it, or correct it except the individual concerned. But the creative process can be supported through capacity building, provision of incentives, and maintenance of institutions. Capacity building requires an infrastructure of technological knowledge and technical skills. Incentives are in the form of opportunities, access to the relevant inputs, motivation, and linkages. Institutions’

13 maintenance requires appropriate laws and statutes, relevant facilities, and an infrastructure of information. Institutions are important because the set the rules for orderly conduct and stability, thereby making growth self-propelling.

Building capacity in scientific knowledge and technical skills, and making conditions favourable for their optimal utilization, are the very minimum required for self-sustaining development. Economic development in this broad cultural sense depends strongly on the links between the natural habitat and the habitualized norms.

Sustainability of the development process would however require that people have the basic condition for healthy living. Hence basic requirements for healthy living like potable water supply, electricity, housing, basic medicament, and employment opportunities are vital for sustaining the development momentum.

Sustaining economic development also requires that CSOs, as representatives of the populace have the opportunity and capacity to engage in independent budget work, and participate constructively in policy making and budget monitoring. The association between democratic governance and economic development is difficult to establish, yet lessons from experiences gathered globally have shown that economies that allow broad participation of CSOs in the budget process tend to do better than those that do not.

2.1.2 Components of a Sound Development Model for Cross River State

The major components for a development model for Cross River State in the context of the above framework are: • Basic needs for healthy living - food, potable water, electricity and fuel, housing, clothing, health care, and communication.

• An infrastructure of capacities - core competences, social capital, information, relevant technological knowledge, and technical skills.

• Incentives in the form of opportunities, linkages, and motivational factors that stimulate and sustain optimal utilization creative potentials.

• Good governance: government that is plan conscious with policies that are research-base; that is accountable and transparent; and that enlists the broad participation of citizen-based groups in the budget process and policymaking.

• Liberal socio-economic environment that allows people and organizations legally seek and realize their economic goals with minimal restrictions.

14 2.2 Structure of a Development Model

A model in this context is a framework that shows how intended outcomes, output, or effects are linked to the set of inputs, or causes. Usually in economics, models are expressed in the form of cause-and-effect, or an if-and-then statement. The ‘ifs’ are the set of causal factors, or explanatory variables, and the underlying assumptions and laws. The ‘then’ is the set of outcomes, impacts, or resultant effects.

Models can be quantitative or qualitative depending on the nature of variables, the output sought, and the system of relationships between the causes and the effect.

Technically, a model has three main components: the set of input factors; the processes and conditioning factors; and the set of outcomes. For a development model, inputs are the resources and inputs for production of goods and services. For instance, abundant good sources of natural water for the provision of potable water, a healthy population, forest reserves, and fertile land, and natural tourism sites are some of the valuable inputs for development in Cross River State.

Conditioning factors are the set of laws and statutes, development infrastructure, social capital (social norms and values), and linkages that dictate the economy of socialization and interaction in the society, and the efficiency with which the desired outcomes are achieved.

Conditioning factors determine the legal and economic environment, the speed of technology learning, managerial and marketing capacities, incentives, and other factors that affect how well the economy ‘functions’; that is, how effective and efficient resources are transformed to final output of goods and services. Infrastructure for water supply, electricity, sanitation, basic health, communication, and transportation, and attitude to work and life are some of the critical conditioning factors in Cross River State.

Model outcomes are usually in the form of goods and services, and impacts. Model builders often desire useful outcomes. For instance, the model outcome for Cross River State is to become the most prosperous state in Nigeria.

It is possible however that unintended outcomes are produced. This may arise when wrong inputs are used, or the conditioning factors are unfavourable. A case to illustrate the possibility of having unintended outcomes is the attempt to provide VIP latrines for some rural communities where faeces are littered indiscriminately. The inputs here are the resources used to build the VIP latrines. The intended outcome is for inhabitants to stop indiscriminate littering of faeces.

The conditioning factors here include; the cultural norms of the community (which defines the accepted ways of disposing faeces); the people’s perception of the innovation (which would determine to a large extent their attitude towards it); and the manner the innovation was communicated to them. It is possible to provide VIP latrines that are not used for defecation because the people have for one reason or the other developed an unfavourable attitude towards the sanitary innovation.

15 They may continue to defecate indiscriminately, while criminals turn the facility to a hideout. An unintended outcome, a hideout for criminal gangs, is achieved instead of the sanitary innovation. In this way, a well intended intervention could suffer because of wrong conditioning, and poor knowledge of the underlying factors.

2.3 The Cross River State Development Model

The vision of the government of Cross River State is to make the state one of the most prosperous states in Nigeria. This is interpreted here to mean the attainment of self- sustaining development. Development is self-sustaining when there are built-in capacities to produce goods and services over and above what is required for basic living.

In other words, a society experiences self-sustaining development when social output continually exceeds the requirements for self-reproduction. Put differently, there should be capacity to generate, and accumulate with ease, the material and intellectual wealth to guarantee consumption, investment, and exports on a continuing basis.

A development model for Cross River State (CRS-DM) naturally has the components for inputs, processes and conditioning, and expected outcomes. The aggregated model for the state is considered here. A model for each economic sector can be developed using a similar logic. Economic development leads to quantitative and qualitative changes in living conditions. But the model here is presented in its descriptive form alone. This is due largely to the dominance of qualitative factors in the development matrix. Besides, statewide data on macroeconomic variables are not available in Nigeria at present. The components of a development model for Cross River State are discussed below.

Model Inputs

The set of inputs for the CRS-DM are summarized as follows: • An active population of men and women, with diverse ethnic and cultural backgrounds, but having a long history of peace and harmonious co-existence. • A luxuriant natural environment, with variety of forest resources and natural endowments. • Variety of natural tourism sites; water falls, peculiar topography, and diverse weather conditions to ensure success of Tinapa project, and the blossoming of eco-tourism in the state. • International sea- and airports that make entry to and exit from the state easy.

Conditioning Factors

Sound and appropriate conditioning factors ensure the effectiveness and efficiency of the production processes, and guarantees that the desired outcomes are obtained. The desirable conditioning factors for CRS-DM include: • Adequate and well-maintained infrastructure for supply of electricity, transportation, communication, recreation, healthcare, and technology learning. • Sound budget preparation, implementation and monitoring systems. • Well-motivated workforce that is committed to the goals of government. • Database and adequate information on the behaviour of economic and cultural variables. 16 • Participation of CSOs in policymaking and the monitoring of budgets. • Sustainable social security programmes and employment opportunities. Intended Outcomes

The set of intended outcomes of the CRS-DM are: • Tinapa develops to become one of Africa’s foremost leisure/trade resorts, with the attendant growth in employment, poverty reduction, and heavy inflow of foreign direct investment to the state. • A private sector driven economy with minimal government regulation. The private sector should be in the driver’s seat of production and commercial activities. • A population that is materially and mentally empowered. • A physical environment that is clean and safe for habitation. • Forest that are conserved and managed sustainably. • Functional health and education systems for all residents in the state. • Reduction in dependence on statutory allocation from federation account.

2.3.1 Government Intervention and Model Outcomes

Government policies basically seek to ensure the following:

• Make development inputs available in their appropriate quantities and types for use by prospective entrepreneurs and investors. This set of interventions bother on definition of property rights, acquisition of land for conservation and industrial uses, enactment and enforcement of environmental and sanitation laws, and expansion of sea- and airports to ensure that they meet international standards.

• Attempt to eliminate all forms of rigidities, distortions, and inhibitions that could impede the production processes. Government has embarked on infrastructural development; including massive construction of roads, and provision of potable water in urban and rural areas. An independent power plant is current under construction in the state, and pressure is put on the Power Holding Company Nigeria (PHCN) to extent more electricity supply to the state. Reform of the budget processes is on going, particularly with the introduction of the Medium Term Economic Framework (MTEF). A lot more still needs to be done, and much institutional support is required. Mainstreaming CSOs is another aspect of the reforms that is on going.

• The desired outcomes are achieved as more people acquire the requisite technical skills and technological knowledge, and are able to utilize them for entrepreneurship. Government is investing heavily in the education sector. Among other achievement, the Cross River University of Science and Technology (CRUTECH) was established, and educational facilities are improved in basic and secondary schools.

The specific economic policy thrusts of the Cross River State are: • Growing the Private Sector. • Capacity Building in Skills and Knowledge, and Human Development • Employment Generation • Ethical Reorientation

17 Growing the private sector

• Public enterprises and facilities that were ailing, underused, or abandoned are either privatized or sold out rightly to private concerns. • Government now establishes factories that are eventually sold to interested private operators. • Introduction of several small scale lending and support schemes to encourage budding private sector operators. • Introduction of small holders’ schemes in farming and livestock breeding.

Capacity building in skills and knowledge, and human development • Implementation of Universal Basic Education (UBE) programme in the state. • Curriculum improvement and provision of standardized books for all subjects for the UBE and SSS students in the state. • Payment of WAEC fees for all SSS students in the state. • Refurbishing and rehabilitation of government primary and schools. • Training and retraining of teachers in the state. • Provision of facilities for training of the disabled and disadvantaged children. • Training and recruitment of health workers; nurses, medical laboratory technologists, and medical doctors to support health service delivery in the state. • Improvement of health facilities and drugs for all levels of health care. • Provision of facilities for non-formal and adult training.

Employment generation • Recruitment of qualified teachers, engineers, medical officers, and qualified information technology practitioners in the state service. • Development of self-employment through agricultural smallholders’ schemes. • Jobs created for artisans and construction workers at Tinapa project sites. • Privatized enterprises would function to create jobs for residents in the state. • Opportunities for small businesses in the emerging tourism and information technology sectors. • Full development of Tinapa project is expected to create a minimum of 30,000 jobs.

Ethical reorientation • Citizenship education, via radio and television programmes, advertisements, and jingles. • Promotion of community participatory governance through support for village and town hall meetings, cooperative societies, and activities of NGOs. • Mainstreaming citizenship education, gender issues, HIV/AIDS, and tourism in policymaking and school curriculum.

2.4 Funding Development in Cross River State

Cross River State obtains its funds mainly from the Federation Account (FAC), and Internally Generated Revenue (IGR). The State was selected in 2005 as one of the lead States in terms of good practices for the implementation of donor-funded programmes. 18 The state would soon be receiving substantial support from donor agencies and development partners.

A lead State/Donor Partnership Workshop was arranged some months ago, where the principles for Memorandum of Understanding (MOU) between the State Government and donors emerged to guide the partnership development relationship over the next 3 years. The list of donors include the World Bank, United States Agency for International Development (USAID), Department for International Development (DFID), United Nations Development Prgramme (UNDP), the European Union (EU), Canadian International Development Agency (CIDA), and the ECOWAS Regional Development Fund (ERDF).

Comprehensive data on the funding content of donor support were however not available at the time of writing this report. Coordinating activities of the donor community, and developing a database for their activities is an aspect of the proposed reforms of the SPC.

Table 1 below is derived from the Consolidated Financial Statement (1999 –2004). Over the 6-year period, internally generated revenue contributed less than 20 percent of total revenue earned in the state. The remaining 80 percent was allocations received from FAC. Government effort in the past six years is geared towards expanding and diversifying the IGR base, and enhancing the efficiency with which IGR is collected.

Table 1- Analysis of Consolidated Financial Statement (1999-2004) (In 1,000million Naira) ITEMS 1999 2000 2001 2002 2003 2004 Recurrent Revenue Internal Sources 490.0 786.0 885.8 1,448.8 2,044 2,271.4 Federal Sources 2,655.8 5,415.6 7,200.0 7,200.0 11,164.7 15,600.0

Total Revenue 3,145.8 6,201.6 8,085.8 8,648.8 13,208.7 17,871.4

Internal/Total Ratio (%) 15.5 12.7 11.0 16.8 15.5 12.7

Personnel Cost 2,156.5 4,025.2 5,190.7 5,086.5 6,011.2 5,757.0 % Of Total Revenue (%) 68.6 64.9 64.2 58.8 45.5 32.2

Overhead Cost 485.0 1,086.8 1,303.6 2,036.9 3,459.4 4,029.0 % Of Total Revenue (%) 15.4 17.5 16.1 23.6 26.2 22.5

Capital Expenditure Economic Sector 366.0 3,427.9 2,924.4 2,410.5 2,951.5 3,767.0 % Of Total Revenue 11.6 55.3 36.2 27.9 22.3 21.1

Social Services Sector 96.6 584.6 2,035.0 882.7 2,023.4 5,885.3 % Of Total Revenue 3.0 9.4 25.2 10.2 15.3 32.9

Source: CRS Budget Office, 2006 19 The high personnel cost notwithstanding, salaries in Cross River State are the least among the South-South states. Increasing salaries with the present workforce may be unsustainable, because virtually all the earnings accruing to the state would be spent on personnel cost to the detriment of other sectors.

The analysis of public finances shows that personnel and overhead costs took over 70 percent of total revenue. The capital budget shared the remaining 30 percent with other pressing needs of government. It follows that some capital projects in the social and economic sectors were financed with loans and grants.

The broad policy approaches for expanding the state’s revenue base focuses on: • Re-organizing the Internal Revenue Service (IRS) for greater efficiency in tax collection, and reduction in corruption and other irregularities. A state consultant is currently working on the computerization of the IRS, and overhaul of its revenue generation capacity. • Intensification of effort in the promotion of new revenue sources, such as the urban Development Tax, and the Authenticated Document Seals.

The major constraints for generating IGR include: • Leakages in the system of revenue collection. • Poor database and defects in the accounting system of IGR. • Poor funding of revenue generating agencies. • Lack of incentives for revenue staff. • Institutional weaknesses (including out-of-date statutes, procedures, and regulations). • Weak capacities and databases for budget analyses (which results in the preparation of unrealistic budgets and poor budget performance). • Ineffective and inefficient expenditure control resulting from the absence of a functional budget monitoring framework, and the non-involvement of CSOs. • Poor maintenance of accounting records. • Delay in producing financial reports due largely to lack of the relevant computer hardware and software. • Poor funding of internal and external audit procedures. • Lack of Intranet connectivity and network to link on-line the key public finance institutions; particularly ministry of finance (and the IRS), state accountant-general, state auditor-general, ministry of local governments, auditor-general of local government, budget office, state planning commission, and the planning research and statistics (PRS) departments of all line ministries and bureaus.

In addition to far reaching tax reforms, government effort is also directed at increasing accountability, reducing wastes, and reforming the entire budget process to ensure that transparency and accountability are achieved.

29 CHAPTER THREE

REVIEW OF CR-SEEDS DOCUMENT

3.1 NEEDS and the EC Donor Strategy NEEDS is described as Nigeria’s plan for prosperity. It is the federal government’s ways of letting the people know how she plans to eliminate the major obstacles to progress. NEEDS vision is to build a truly great African democratic country, politically united, integrated and stable, economically prosperous, socially organized, with equal opportunities for all, and responsibility from all to become the catalyst of (Africa’s) Renaissance, and making adequate all-embracing contributions; sub regionally, regionally, and globally. The NEEDS vision is also one in which Nigeria fulfills its potential to become Africa’s largest economy and a major player in the global economy.

NEEDS focuses on four key goals: reorienting values, reducing poverty, creating wealth, and generating employment. The key assumptions are that these goals can only be achieved in an economy driven by private sector initiative, where government is redirected to providing basic services, and people are empowered to take advantage of emerging economic opportunities in the domestic and global economies.

With regards to value reorientation, NEEDS sets out far-reaching public reforms to make clear that corruption and graft will be punished. The National Orientation Agency and its state-level counterparts are strengthened to lead a campaign to accumulate social capital; that is, re-instill the virtues of honesty, hard work, selfless service, moral rectitude, and patriotism.

The campaign draws on resources from a variety of government agencies, non- governmental organizations (NGOs), and community-based organizations, including schools, colleges, universities, and private sector, religious, social, cultural, and traditional organizations. In addition to the Nigerian Police Force and other state security agencies, specialized anti-graft and anti- poor standards agencies like the Economic and Financial Crimes Commission (EFCC), Independent and Corrupt Practices Commission (ICPC), National Agencies for Food and Drugs Administration and Control (NAFDAC), and Standards Organization of Nigeria (SON), among others, were either established or reinvigorated to apprehend and punish corrupt individuals and organizations.

To reduce poverty and inequality, the plan is acting on several fronts: • Offering farmers improved irrigation, machinery, and crop varieties to boost agricultural productivity, since half of Nigeria’s poor work in agriculture. • Provide support to small and medium enterprises through various interventions such as Small and Medium Industry Equity Investment Scheme (SMIEIS), establish micro-credit organizations, and entrepreneurship training programmes. • Implement integrated rural development programmes to stem the flow of migration from rural to urban areas, and check excessive exploitation without replenishment. • Since half Nigeria’s population are children, NEEDS promotes adoption of the Universal Basic Education (UBE) scheme, which provide for 9 years of compulsory and free education for Nigerian children regardless of the economic status of their parents.

21 • Improve the system of healthcare delivery with emphasis on HIV/AIDS and other preventable diseases, such as malaria, tuberculosis, and reproductive health-related diseases. • Monetization of fringe benefits in the public service, and introduction of a contributory pension scheme to ensure that public servants are fully rewarded while in service, and that their retirement benefits are guaranteed. • Special programmes and law reforms targeting the poor, particularly women, children, disabled, and elderly who have the weakest political voice, but are most vulnerable to the ravages of poverty and exploitation.

In addition to these, NEEDS emphasizes the critical importance of improving infrastructure, particularly those for electricity, transportation, and communication. The strategy equally seeks to attract foreign investment in the key economic sectors particularly in oil and gas. Trade policies are modified to unburden business of the red tape and complex procedures that hinder it from flourishing. NEEDS envisages also forging stronger links between educational institutions and industry to stimulate rapid industrial growth and efficient exploitation of resources.

3.1.1 Macroeconomic Framework of NEEDS The macroeconomic framework for NEEDS draws from the following policy thrusts: • Empowering the people, through improvement in facilities for health, education, environment, and integrated rural development, employment and youth development safety nets, gender and geopolitical balance, health insurance schemes, and pension reforms. • Promoting private enterprises – security and rule of law, infrastructure, finance and sectoral strategies, privatization and liberalization, trade, regional integration, and globalization. • Changing the way government does business - public sector reforms, privatization and liberalization, governance, transparency, and anticorruption, service delivery, budget, and public finance reforms.

NEEDS assumes that growth in private sector will create more opportunities for wealth creation and employment generation. People are empowered to take advantage of these opportunities by; creating a system of incentives to reward hard work and punish offenders; investing in education; and by providing special programmes for vulnerable members of the society.

The private sector is the engine of economic growth under NEEDS. It is expected to serve as the executor, investor, and manager of businesses. Government will play the role of enabler, facilitator, and regulator, helping the private sector to grow, create jobs, and generate wealth. Government is seen generally as a ‘bad businessman’ whose investments in the real sector are not only wasteful but more seriously able to crowd-out private investment; deregulation and liberalization will therefore reduce government control and attract more private investment.

Reduction in the involvement of government in economic activities will reduce the cost of running government, with the associated wastes. Monetization also means that in-kind benefits to civil servants and political office holders, such as subsidized housing, transport, and utilities are regulated to fixed sums of money. Reforms and regulations will be implemented to ensure greater accountability and transparency, and corrupt practices 22 outlawed. A framework that connects policy with government income and expenditure will inform government activities and budgeting.

3.1.2 Sustainability and Responsiveness of NEEDS/CR-SEEDS to Crosscutting Issues of Gender, Poverty, Environment, and Social Welfare.

Poverty and inequality are serious problems of the Nigerian society at present. Currently over 70 percent of Nigerians still live on income that is below $1 per day. Several people, it would seem need more assurances that the reform programmes would work. Many still stick to strategies they adopt to cope with hardship; such strategies often include poor attitude to work and life, excessive search for additional income to wedge fears of future uncertain sociopolitical and economic outcomes, excessive exploitation of natural resources without consideration of the environmental consequences, and several sundry corrupt practices. As rightly observed in the NEEDS document, lack of basic amenities such as clean water, education, health care can intensify poverty. Discrimination on the grounds of gender, race, disability, age, or ill-health can increase vulnerability to poverty. The success of NEEDS hinges on the capacity of its various programmes to target the poor. Indeed, radical changes are required for NEEDS/SEEDS/LEEDS to address crosscutting issues of poverty, gender, environment, and social welfare. Some of the major issues to be addressed are as follows:

First, many need to be convinced that private led development can redress these structural anomalies. Government has for several years been the direct source of wealth and livelihood for several people, and the situation may be quite difficult to change. By 1999 corruption was practically institutionalized. Government was seen as the source of wealth and people naturally had to struggle to key into one aspect of government engagement or the other.

Rather than engage in endeavours that would benefit the economy, many experts have abandoned their careers in search for easy government funds. What appeared initially as a coping strategy has become institutionalized! The polity has become addicted to measures that helped them cope with poor living conditions, and many have internalized coping strategies as accepted social norms.

Under such conditions, many align themselves into ‘small groups of illegalities’ to struggle for their self-interests instead of the public good. The NGO communities are not left out; many put pressure on governments and donors, using various antics and pretenses, to extract ‘their share’ of public funds. Public interests for many are second place to personal and small groups’ interest. The state economy has become an “economy of affection”, where people relate more on the bases of blood, kin, religion, and parochial sentiments, instead of productive engagements and formal linkages of governance. The capacity of NEEDS to address the crosscutting issues of gender, poverty, environment, and social welfare would depend on how soon the populace can unlearn wrong norms that have caused the decay of social capital in the past.

Second, public finance management processes across the different tiers of government have remained poorly defined. In particular, the fiscal responsibilities of the federal, state, and local governments have not been clearly defined. Moreover the ‘economy of affection’ sustains itself by ensuring that the budget process and management of public

23 finances remain the secret reserve of its operators who incidentally serve the interest of small groups that struggled to put them in government. The legitimacy and stability of government suffer as people institutionalize means of surviving outside what is productive and legal.

Long years of military rule have helped to institutionalize adhocism, fiscal centralization, and arbitrariness. 33 out of the 46 years of independence were spent under unitary military dictatorships. It would appear that the political class imbibed the culture of secrecy in the conduct of government business, which the military popularized. Despite being a federation, fiscal federalism is yet to take roots. The federal government still has overwhelming control of the country’s resources, including what ultimately goes to states and local governments. Local governments are worse hit as the relationship between them and the state governments are not well defined.

Indeed the role, fiscal rights, and responsibilities of local governments, and the constitutional boundaries between them and state governments are yet to be fully defined. These ambiguities have serious adverse implications for transparency and accountability, and sustainability of the NEEDS reform agenda. It lies in the ambit of the legislature and judiciary to strengthen the practice of fiscal federalism with well defined laws and statutes that provide clear fiscal boundaries between the various tiers of government.

The challenge for sustainability of NEEDS is the institution of a sound budget process with broad participation of all stakeholders, having irrevocable statutory guarantee for what should goes to each arm of government, and well defined boundaries for the different tiers of government. Under existing conditions the legislative and judicial capacities of the legislature and judiciary arms, respectively, are sometimes weakened by their fiscal dependence on the executive arm. The executive, technically, can starve the other arms of funds, and sometimes strangle them to do its bidding.

Third over dependence on oil as the primary source of government revenue is not sustainable in the long term. Crude oil exports contribute over 90 percent of Nigeria’s revenue. Oil income directly influences spending. There is a boom-and-bust mode of economic management; when oil income is high spending is high and dips in oil prices are treated as temporary. The temptation to over spend is high. This led to heavy external indebtedness in the past. However the recent Paris Club concessions in 2006 has helped Nigeria to cut down its over $30billion external debt to a manageable level of about $4billion. This was made possible by the unprecedented surge in oil prices since 1999, which has provided earnings well over the budgeted figures for the past 5 years or so. The excess crude sales have equally led to an unprecedented increase in external reserve, which is put at $38billion in July 2006.

The recent huge earnings notwithstanding, Nigeria’s business environment is still difficult. Businesses wishing to operate in Nigeria face many constraints, including poor infrastructure, particularly road networks and electricity supply; inadequate physical security; corruption; weak enforcement of contracts; weak definition of property rights; high interest rates (over 25 percent in some commercial banks); and high transaction costs generally. These factors have deterred foreign entrepreneurs from investing in Nigeria and induced many Nigerians to take their money and skills abroad.

24 Other macroeconomic indicators are provided in Table 2 below. Commercial banks’ total loan to Small and Medium enterprises (SMEs) in 2004 was a paltry 5.07%. This was certainly not good enough for the goal of employment generation and poverty reduction. Understandably commercial banks find it difficult to give out loans to small businesses that may not have the requisite collaterals. Government has responded to this inadequacy by creating micro-finance institutions with lending to small government guarantees businesses. But the bogus that SMEs are defined allow fairly large businesses to exploit the opportunities offered at the expense of very small businesses.

The problem of properly defining how should benefit from what is a general malaise that arises from poor planning and lack of research bases for policies. Ideally each of the four crosscutting issues needed to have a well-researched programme to adequately articulate it. Policies to on poverty alleviation, gender balancing, environmental preservation, and social development ought to have been based on well-drawn research-based programmes instead of guesswork and conjectures. There is need to properly identify the specific support that different private sector operators require, how to preserve the environment in different areas, the gender biases that needs to, and so on.

Poor policy programming has remained the bane of various attempts to promote private initiative in Nigeria. The 2005 banks’ reconsolidation exercise that raise the equity base of commercial banks’ in the country to N25billion sought to address the problem of small businesses in a different way. Banks now have a higher capital base and can finance investment projects directly or in joint venture with private sector operators. In addition, commercial banks in conjunction with the Central Bank of Nigeria (CBN) in 2001 initiated the Small and Medium Industries Equity Investment Scheme (SMIEIS). This scheme requires each commercial bank to pay 10 percent of profit before tax to the SMIEIS fund, which is managed by the CBN. Banks for direct equity investment in small businesses can access the fund.

These financing initiatives notwithstanding, small businesses still have to contain with poor infrastructure for transport and communication, and epileptic electricity supply. Aggregate demand is also low; per capita (using GDP at 1984 factor cost) as at 2004 was as low as $8.88. Life expectancy was also low at 53 years and over 60 percent of the population lives below the poverty line. In addition, capacity utilization remained less than average, non-oil exports was still as low as 3.62 percent of total exports, and cumulative foreign investment was abysmally low at $780.27million.

Fourth, low capital spending on infrastructure and facilities that would benefit the poor can frustrate social development. In 2004, capital expenditure on administration significantly exceeded spending on education, health, communication and transport, and agriculture and natural resources. Sustaining development would require that more resources be committed to the provision of infrastructure for transport, health, education, transportation, and communication.

Fifth, is the weak participation of citizen-based organizations in budget work and tracking of public spending? There is room for improvement in this direction. However, CSOs and the Press need to build capacity for independent budget monitoring and reporting of public finance issues. It is in the light of these that one can safely see the current SRIP initiative in Nigeria as a useful development.

25 Table 2 - Nigeria: Selected Indicator of Macroeconomic Performance (2004) Commercial Banks loans to Small and Population growth: 2.8%* Medium Enterprises as Percentage of Total Estimated Population 124million (1999)* Credit (%) 5.07 (2004) Oil Revenue as Percentage of Total Revenue Religion: 45% Muslims, 35% Christians, (Federal Government) 86.0% (2004) 20% Animists* GDP at 1984 Constant Factor Cost Life expectancy: 53 years* $1,101.36million (2004) Adult literacy: 63%* Human Development Index position: 146th / 174* GDP (1984CFC)/per capita (2004): Exchange rate: 132.0 Naira : 1 US $ (official) US $8 .88 Below poverty line: 66%* Infant mortality: 122/1000 live births* Capital Expenditure on General Food Imports/Total Imports (%) 9.0 (2004) Administration (% Federal Capital Budget) 23.0 (2004) Transport and Communication (% Federal Average Capacity Utilization in Capital Budget) 2.22 (2004) Manufacturing 45% (2004) Agric. And Natural Resources (% Federal Non Oil Exports/ Total Exports 3.62% Capital Budget) 1.23 (2004) (2004) Health (% Federal Capital Budget): 5.8 Cumulative Foreign Private Investment in (2004) Manufacturing and Processing $780.27million (2004) Education (% Federal Capital Budget): 2.9 Inflation Rate 17.6 (2004) (2004) Sources: Central Bank of Nigeria Statistical Bulletin Vol.15, December, 2004 * Obtained from Nigeria - European Community Country Support Strategy and Indicative Programme for the period 2001 – 2007 (Appendix 4), Page 51.

3.1.3 EC (Donor) Strategy and NEEDS

The European Community offers Nigeria a unique chance to address its many reform challenges. EC initiative in Nigeria is in the form of financial and equipment support, capacity building through various kinds of training, and linkages. However continued political courage is required to take advantage of these offers. In particular, the government needs to strengthen respect for the rule of law, continue to fight against corruption and improve management of resources so that earnings from oil exports can provide poverty reduction services, notably water and sanitation, education, and health. EC funding is not large enough to address these challenges directly; but it can help Nigeria find ways to do so, by supporting Nigerians’ own reform efforts. For this reason, the EC proposes to concentrate on working with Nigerian programmes, rather than establishing separate projects.

In the Federal structure of Nigeria, the state and local levels have received, and are set to continue to receive, increased resources and greater autonomy as a result of the return of democracy. This is because states and LGAs have more responsibility for poverty- reduction services. The EC therefore proposes to concentrate more on these levels.

26 Given the large number of states, the EC will concentrate on six of the thirty-six states in Nigeria; these are Abia, Cross River, Gombe, Kebbi, Osun, and Plateau states. The national indicative programme will support reform, with the aim of radically improving service delivery, especially in the priority areas of water and sanitation. The programme will initially fund support for reforms (training, institutional strengthening, and technical assistance).

Subject to progress in improving service delivery, it will in a second phase provide substantial direct budget support to the six states. Increased transparency of public accounts at all levels will necessarily be an important component of these reforms. In this regard, civil society organizations (CSOs) have important roles to play by serving as the public’s watchdogs, and ensuring popular participation in the setting of priorities and the monitoring of their implementation.

In accordance with Article 177 of the Treaty establishing the European Community, the EC in the sphere of development co-operation shall foster: • The sustainable economic and social development of the developing countries, and more particularly the most disadvantaged among them; • The smooth and gradual integration of the developing countries into the world economy; • The campaign against poverty in the developing countries. These objectives have been confirmed and reinforced in Article 1 of the ACP-EC Partnership Agreement, signed in Cotonou on 23 June 2000, which put the main emphasis on the objective of reducing and eventually eradicating poverty.

Co-operation between the EC and Nigeria shall pursue these objectives, taking into account the fundamental principles laid down in Article 2 of the Agreement – notably the principle of encouraging ownership of the development strategies by the countries and populations concerned –and the essential elements and fundamental element defined in Article 9.

To achieve these objectives, the Council of the European Union and the European Commission, in their Statement on the European Community's Development Policy of 10 November 2000, determined a limited number of areas selected on the basis of their contribution towards reducing poverty and for which Community action provides added value: link between trade and development; support for regional integration and cooperation; support for macro-economic policies; transport; food security and sustainable rural development; institutional capacity-building, particularly in the area of good governance and the rule of law.

The Statement also specifies that in line with the macroeconomic framework, the Community must also continue its support in the social sectors (health and education), particularly with a view to ensuring equitable access to social services. The Treaty establishing the European Community foresees that the Community and the Member States shall co-ordinate their policies on development co-operation and shall consult each other on their aid programmes. Efforts must be made to ensure that the EC development policy objectives are taken into account in the formulation and implementation of other policies affecting the developing countries.

27 Furthermore, as laid down in Article 20 of the Agreement, systematic account shall be taken in mainstreaming into all areas of co-operation the following thematic or cross- cutting issues: gender issues, environmental issues, and institutional development and capacity building.

On 15th May 2001, the European Council of Ministers adopted a specific Common Position on Nigeria that aims to strengthen the mutually beneficial relations between the EU and Nigeria in all areas of common interest. This Common Position specifies that the EU will pursue a consistent and coherent approach towards Nigeria, covering policies within the political, economic, trade and development fields, with a view to supporting and encouraging Nigeria’s own processes of: • Consolidating democracy and respect for human rights; • Reducing poverty and achieving sustainable institutional reform, social and economic development; • Enhancing its capacity to contribute to regional integration, peace, security and development, and to integrate into the world economy.

The EC recognizes that progress in these efforts is primarily the responsibility of the Federal Republic of Nigeria. Strengthened relations between the EU and Nigeria shall be based on equality, dialogue, and shared values of respect for human rights, democratic principles, the rule of law and good governance. This is to be achieved through a constructive political dialogue, mainly with the federal government but it could also involve civil society and state governments. As envisaged in the Cotonou Agreement (Articles 6 and 7), the EU stresses the importance of encouraging broad involvement of public authorities and civil society in its intervention programmes.

Another tool will be efficient development cooperation for which the Commission may use in particular pertinent Community measures. This cooperation will be guided by Nigerian priorities, be poverty oriented and involve close Nigeria-led donor coordination, broad participation, accountability and transparency.

3.2 CR-SEEDS as a Development Strategy

Nigeria’s current socio-economic reform agenda, the National Economic Empowerment and Development Strategy (NEEDS), and it derivatives for Cross River State CR-SEEDS, and local governments LEEDS, were launched in 2004 as medium term development strategy for Nigeria. NEEDS generally, and CR-SEEDS in particular, is designed to achieve the following core goals: • Create gainful jobs for the unemployed. • Poverty reduction and empowerment of vulnerable groups. • Wealth creation. • Ethical reorientation.

These goals of NEEDS and CR-SEEDS are certainly in line with the MDGs and other global standards set for the growth and transformation of poor economies.

28 The initial assessment of the achievability of the MDGs in Cross River State (that is Lead State: Initial Assessment) showed that the state was above average in many respects: poverty level was close to national level at 55 percent; adult literacy rate was above national average at 73.6 percent; and enrolment rates for primary and secondary schools were 81 percent and 54 percent respectively. But the HIV/AIDS prevalence rate was 12 percent (highest in the country).

The major issues raised in the 2005 CR-SEEDS benchmarking report include: • CR-SEEDS identify some priority areas (tourism, health, education, job creation, and poverty reduction) that are in line with the MDGs, NEEDS, and main donor goals. • There are no evidences of adequate consultation with CSOs and other citizens’- based groups in drawing up CR-SEEDS. • There are no comprehensive fiscal strategy documents setting out revenue raising and expenditure projections, public debt management and tax reforms, and data on foreign investment. • Variances in budget implementation were between 60 to 70 percent. This makes effective planning for service delivery difficult. • The budget formulation process contains several areas of best practice and is completed in time, but the budget does not seem to be disseminated outside the government. • The IGR has often been overestimated. • The state did not produce any evidence of budget monitoring, but does produce annual budgets. It was not clear whether funds are released to line ministries in line with a pre-agreed plan. • Accounts are produced and audited on schedule. However, there was no evidence of active scrutiny of the Auditor General’s report by the State House of Assembly, or the government taking actions in response to audit findings. There is some evidence of audit of state-owned enterprises and parastatals, but not of value for money audit. • The state takes part in national policy councils and has some good examples of cooperation with local governments and non-government providers in delivery of services. • On payroll, there was no evidence of staff reduction arising from staff audits. • There was a staff training strategy but no evidence of job audits, or that all staff had job descriptions. • Commissioners and others government functionaries use radio and TV phone-in programmes to receive feedbacks on the activities of their respective ministries. Other forms of redress include a complaints hotline in the Governor’s (and every Commissioner’s) office. There are also suggestion boxes in strategically located offices. There was evidence of reports of action being taken in response to complaints. However there was no evidence of independent monitoring by non- government monitors, or of service charters or service needs assessments. • There was little evidence of any action taken to make procurement more transparent, such as due process certification, publication of tenders, or contract awards. In view of the high priority given to a few capital projects in the budget, this is an important area of improvement.

29 • There was limited evidence of action taken against corruption. There was no evidence of anti-corruption policy guidelines, exposing corrupt practices or prosecuting corrupt individuals or recovering assets. • There was no evidence that NGOs, the private sector, and civil society are able to obtain information on how public finances are managed. Auditor General’s reports are occasionally made available to the public; the state government does not seem to make many other attempts to share its actual income and expenditure with the public.

The analysis of CR-SEEDS against the backdrop of the major contentious issues in the 2005 benchmarking exercise is summarized below: • In addition to tourism, health, education, and job creation, the state has invested heavily in agriculture. The tourism sector is already creating jobs; it is estimated in 2006 that over 5000 jobs were created, 3000 out of that specifically created from the heavy construction work in Tinapa alone. No state government has been able to generate such massive employment from a single project. Government also provided free seedlings to boost agriculture. However while unemployment and poverty conditions remain grave, many beneficiaries of the opportunities created are Nigerians that are relocating from other states to Cross River State. More education and sensitization are required to make Cross Riverians take advantage of emerging opportunities. • Consultation with CSOs improved in 2006. CSOs were invited to give inputs to the 2007 budget preparation by the budget office. Appropriation Committee of the SHA also invited inputs from non-governmental groups. But CSOs representatives complain that such invitations hardly get to them in time. • Databases in the state are generally poorly maintained. The state currently has a website but core public finance data are yet to be posted for public consumption. • Actual release of funds for implementation of budget still falls short of appropriated estimates. • Value for money audit is still inhibited by lack of funds. Often departments that are audited pay the transport cost of auditors! The audit department lacks information bank on current prices and costs of projects. These inhibit value for money auditing. • A SERVICOM unit was established in 2006 to ensure effective and efficient service delivery in the state. When fully operational the unit would provide a feedback mechanism for evaluation the performance of public officers and departments. • The Budget Monitoring and Price Intelligence Unit (Due Process) is currently located in the Budget Office. There is evidence that the mechanism to make procurement transparent exist, but its workability is inhibited by poor funding and limited access to information. • Opportunities for embezzlement of funds in the line ministries are greatly reduced by the centralized management of public finances in the state, and the effectiveness of control mechanisms in the Budget Office, Auditor General’s Office, and Accountant General’s office, and the Public Accounts Committee of the SHA. Officers and contractors found to have been overpaid are often given an opportunity to make refunds, failing which court actions are instituted. The Inspectorate Department in the Auditor-General’s office has been reconstituted as a Task Force for assets recovery.

30 • There is still no evidence that NGOs, the private sector, and civil society are able to obtain information on how government money is spent. The procedure for assessing Auditor General’s reports and other information on the actual income and expenditure of government may be quite difficult.

3.2.1 General Assessment of CR-SEEDS

CR-SEEDS was launched in 2004, but several line ministries and government agencies would be commencing full implementation of several of its provisions in the 2007 fiscal year. However the Donald Duke led administration has since 1999 taken far-reaching steps that are in tune with the goals and expectations of CR-SEEDS. Some of such steps include: • Privatization and out right sale of ailing government enterprises that can be run on commercial basis. • Development of tourism, and the Tinapa Project as engines for wealth creation, and employment generation. • Curriculum development and general improvement in the conditions and materials for teaching\learning at all levels of education in the state. • Provision of substantial material and motivational support for vulnerable groups. • Provision for facilities for basic health care, water supply, and sanitation in the state capital and local government areas.

The areas of major focus of CR-SEEDS in the medium term (2004 – 2007) are Tourism and the Tinapa Project, health, education, agriculture, small and medium enterprises, forestry development, and infrastructure development including roads, portable water supply, and rural electrification.

The CR-SEEDS document is presented in six parts. Part I, the introduction, has six chapters. General issues like the people and culture of Cross River State, the vision statement and mission of CR-SEEDS, and the strength, weaknesses, opportunities, and threats (SWOT) analysis are presented.

The philosophy of CR-SEEDS is not provided, but the vision statement indicates that: Cross River State aspires (by 2020) to be a leading Nigerian State with prosperous, healthy and well educated citizens, living in harmony with people and nature and pursuing their legitimate interests in freedom moderated by good governance.

Part II is titled Human Development Agenda and Empowering People. There are nine chapters in this part. Basically the current programmes of government for education, health, HIV/AIDS, environment, housing and urban development, pension reforms, institutional analysis, security, and infrastructures development are reviewed here.

There is however no chapter on specific approaches for empowering people. It is fallaciously assumed that social services themselves amount to empowerment. Accessibility and affordability of the opportunities offered and how the people perceive social services are not considered. It is possible to have health centers that people do not patronize, and environmental laws that people refuse to obey. An operational definition of empowerment, with proper definition of its possible measures, content and context, and means of attainment from the people’s perspective, is conspicuously missing in the entire CR-SEEDS document! 31 Part III is titled: Growing the Private Sector (Growth Drivers). This part has five chapters on agriculture, industrialization, tourism, forestry, and Housing and Urban Development. Each chapter identifies the policy thrust, the targets, and pressing challenges of the respective sectors. Here again, composition of the private sector is not well defined. What is the aggregate capacity of the private sector? What percentages of the private sector do Cross Riverians, other Nigerians, and foreign direct investors’ control? The absence of such details merely indicates that the CR-SEEDS and LEEDS documents were not based on detailed baseline studies and analyses.

It is one thing to provide opportunities and incentives, and quite another to have people exploit them. It matters too who constitutes the private sector; the state is likely to benefit more when indigenous operators are active participants in the private sector, and can benefit from incentives offered by government programmes. When foreign firms dominate the private sector, and indigenous entrepreneurs lack the requisite knowledge and skills for technology learning, much of the gains expected from tourism and the Tinapa projects would leak away to other states and countries!

The tourism sector could become to the state an enclave economy, like what the petroleum sector is at present to Nigeria, with minimal forward and backward linkages to other sectors of the state’s economy. How to empower indigenous people with entrepreneurial skill and venture capital should be considered an essential component of growing the private sector. It is not sufficient to assume that they can learn on their own, or borrow money from banks; these were some of the unrealistic assumptions of SAP, which partly explains why it failed. CR-SEEDS should not commit such fallacies of overgeneralization. CR-SEEDS like NEEDS has failed to incorporate specific programmes to capture the crosscutting issues of poverty, gender, environment, and social development.

Moreover, past reform programmes like SAP, and guided deregulation had objectives that were similar to CR-SEEDS. It would have been necessary to review them to locate the departure point of NEEDS/CR-SEEDS/LEEDS. Now it is not clear whether NEEDS is an extension of SAP, or whether it is an entirely new reform programme. One would have expected a comprehensive review of past developments; successes and problems encountered in the past, and what makes CR-SEEDS an improvement over previous reforms.

Part IV deals with reforming government and its institutions, and has three chapters. Chapter 21 specifically deals with public sector reforms and governance. Various on- going reforms of government institutions are discussed. Curiously, democratization of budgeting and policymaking processes, and the rule of CSOs are not discussed. How to make the choices of government to reflect the wishes and aspirations of its people is not examined in detail in the CR-SEEDS document! It is essential for a government to be prudent, but broad participation of all stakeholders, particularly credible CSOs, would ensure that social relevance is not sacrificed on the alters of prudence. It may indeed be preferable to do the right things inefficiently, than do the wrong things prudently.

Part V presents financing and implementation strategies. The part has five chapters dealing generally with due process, and financing and implementation strategies.

32 Part VI has two chapters and is titled, Priority Programmes of CR-SEEDS. The links between CR-SEEDS, and NEEDS and the MDGs are discussed. The prioritization of programmes in CR-SEEDS was clearly not based on some baseline studies or a comprehensive database that reflects the true needs of the people and challenges of development in the state. When for instance education is made a priority sector, the question that should readily come to mind are; what kind of education is really required and at what cost? What proportions of the education budget should be spent on formal and non-formal education? Providing answers to these questions is essential for making CR- SEEDS more realistic and socially relevant.

The information bases for CR-SEEDS are generally weak. The sources or origins of several statistical tables in the document are not indicated. It is clear that the entire document was prepared in a hurry. The broad goals and vision of CR-SEEDS as a development strategy are quite good and achievable, but the document lack roadmaps for attaining its excellent goals. In particular, it lacks details on the initial conditions, impact of the external environment, the successes and failures of past reform programmes, the improvement offered by CR-SEEDS, and measures of the expected success in each case.

The ad-hoc manner that CR-SEEDS/LEEDS documents were packaged shows clearly that the machinery of data collection and economic planning in the state are quite weak. Its inability to consciously create roles for CSOs is its other major weakness. In its present form the CR-SEEDS document is a good proposal for a development strategy, but certainly not the strategy itself. More sectoral base socio-economic studies and appraisals are required to transform the NEEDS/SEEDS/LEEDS documents from their present proposal presentations to operational development strategies.

A review of CR-SEEDS to reflect the above expectations and missing ingredients is necessary. However, building capacity for planning and budgeting, creating opportunities for CSOs and other stakeholders to participate actively in policy making and monitoring, empowering CSOs to engage in independent budget work, strengthening the control capacities in accounting and auditing, and launching an enduring data collection machinery are the minimum preconditions required to review CR-SEEDS and LEEDS into operational documents. This is where SRIP initiatives in the state are of immense value to the state.

3.3 Challenges of Development in Cross River State

The following are challenges that the proposed review of CR-SEEDS and LEEDS document should address to enable the documents address the crosscutting issues of poverty, gender, environment, and social development. • First, problems associated with moving from a public sector dominated economy to private-led growth should be addressed. Many have grown with the fact of heavy government presence, and despite obvious inadequacies and failures, would prefer that government continue to play leading roles. Many find it difficult to see how activities of private operators would ultimately benefit the state and its people; they tend to see sale of government enterprises as net loss to the state and its people, particularly when the major private investors are non-indigenes. SRIP can support the SPC to produce, for consideration and approval, a comprehensive programme for growing the private sector in the state. It is necessary to have a

33 chapter on how to enhance the production capacities of local entrepreneurs in a revised CR-SEEDS and LEEDS document.

• Second, is the need to increase the state’s IGR. Over 90 percent of revenue to the state is statutory allocations from the federation account. Despite being an oil producing state, the special allocation to the state from derivation fund is quite low. Internally generated revenue is equally low. The giant strides of government notwithstanding, Cross River can still be described as a ‘civil service’ state. Government has responded to the situation by reorganizing the internal revenue generating machinery to minimize inefficiencies associated with collecting internally generated revenue (IGR). New taxes notably the Urban Development Tax have been introduced. A state consultant is currently engaged to enhance the operational efficiency of the state Internal Revenue Service (IRS). An aspect that needs to be examined is how eco-tourism can promote the activities of small and medium enterprises, thereby encouraging more small businesses to be established. It is wrong to take for granted that businesses will just spring up from tourism; there could be several socio-cultural and economic factors that inhibit internalization of the tourism economy. Calabar has been a sea- and airport city for many years. The town indeed was the first capital of Nigeria before Lagos and Abuja. It is necessary to examine why the rate of industrial growth in Calabar and other towns like Ikom, Obudu, and Ogoja have been slow despite their history of early exposure and economic activities. SRIP can again support SPC to produce a programme for tourism development in the state. Such a programme can become a component of the revised CR-SEEDS document.

• The third major challenge is the huge recurrent expenditure of the state. About 70 percent of earnings accruing to the state and local governments are spent on personnel cost and overhead expenses. This reduces substantially the allocation for capital projects in the state. The high aggregate personnel costs notwithstanding, salaries in the state service are lower than as obtained in other South-South states. Mass retrenchment would certainly not be the best solution for obvious reasons. A study on how to right size public with minimal social cost can be launched by SRIP.

• The high personnel cost notwithstanding, it is still necessary to enlist the support of public servants in the state. In addition to the services for the state, they feed the domestic demand base of the state. Until the private sector replaces the public service in terms of employment capacity, the demand base of the state depends largely on the earnings of public servants. The capacity to attract businesses from elsewhere depends on the domestic buying power. Incentives like subsidized housing and car loans can boost their morale, and more importantly stimulate demand for cars and building materials in the state. An importer may be attracted to import cars through Calabar seaport as a result. A lot more can be done in this regard and SRIP can sponsor a study to examine such possibilities.

• Many workers expressed their willingness to retire voluntarily if there were concrete arrangements for the prompt settlement of entitlements. This means the workforce can be reduced systematically by a deliberate policy that encourages workers who have served for a certain number of years, and whose services are not in critical need to retire voluntarily. Apart from reducing the size of the public 34 service, such a policy can increase domestic demand and encourage private investment by the retirees. SRIP can launch research works in the SPC to explore the retirement proposal and how it can be sustainable.

• Implantation of the culture of eco-tourism in the psychics of residents, business operators, educational institutions, religious organizations, and so on, in the state is of immense importance to success of the emerging economy. Eco-tourism is a cultural product and the attitude and disposition of residents is vital for its success. Radio and television adverts and jingles are not adequate. There is need for a comprehensive package to address the need of this emerging sector. SRIP can sponsor a socio-cultural cum economic study for the formulation of a programme for the State Tourism Bureau to implement.

• There is need to set up structures for training and technology learning in the state. The current focus on formal education is well taken. But more still needs to be done in the areas of non-formal training: motor vehicle mechanics, electricians, carpenters, vulcanizes, hand-set repairers, builders, drycleaners, waiters and waitresses in hotels\restaurants, and so on, need training and exposure to increase their competences. They do not have to abandon their vocations for formal schooling. At present the knowledge and exposure of vocational workers and tradesmen are quite low and inadequate. Broken down cars and equipments cannot be repaid successfully in the state. What is done currently is repay by ‘trial and error’. It is not as though the artisans are naturally bad, or that something particularly is wrong with them; the simply truth is that they need training and exposure. Ironically it is these tradesmen and street boys that tourists would meet; tourists cannot possibly go into schools to meets pupils and students who have received tourism education! It is not sufficient to sensitize tradesmen on the possible gains of eco-tourism; their vocational skills and knowledge need to be updated continually. Government may need to sponsor intensive training modules that take some of them outside the country for internships in Germany, China, or anywhere that the best practices exist. Training programmes for tradesmen and artisans could reduce crime and create opportunities for gainful self-employment. Bands of poorly trained and frustrated tradesmen and artisans who have found it easier to turn their working tools into weapons fuel many of today’s violent crimes. SRIP can fund a study to examine this possibility.

• It is absolutely essential to mainstream CSOs in the budget process and policymaking. At present, the role and terms of engagement of CSOs are not well defined. Recent effort at recognizing CSOs is due largely to pressures from donor organizations. CSOs are now invited to provide inputs for budget formulation. Non-recognition of the vital role of CSOs in governance is rooted largely in the past long years of military rule. The command and control structure of the military had little or no room for broad participation and criticisms. Now in the democratic era, government officials and politicians are yet to recover from the nostalgias of military dictatorship. Non-acceptance of CSOs as stakeholders in the past has contributed to their weak capacities and poor organization. There is an urgent need for CSOs to position themselves as credible and organized stakeholders to allow government take them seriously. CSOs need to develop capacity for independent budget work and shadow budgeting to truly impress the expectations of the

35 populace on government through the budget process. SRIP can contract a consultant to prepare a programme for mainstreaming CSOs in Cross River State.

• The need to Internet facilities and other IEC materials and gadgets in the SHA cannot be emphasized. Personal computers (table and laptops) are necessary for computerization, storage, and retrieval of data and other relevant information. Honourable members need to have access to best place legislative practices from other mature democracy. The present level of training and exposure is grossly inadequate. Computerization will also make monitoring of public spending and other oversight functions of the committees of SHA more effective. In addition, training of Honourable Members and key staff of the SHA; on economic planning, financial controls, and the current medium term economic planning framework (MTEF), is necessary for the success of budget and public finance reforms in the state.

36 CHAPTER FOUR

COORDINATION OF DEVELOPMENT PARTNERSHIP PROGRAMMES IN CROSS RIVER STATE

4.1 Lead State/Donor Partnership Initiative Cross River State government has a genuine desire to partner with relevant Donor Agencies for optimum service delivery to its people. In particular, she desires that partners’ assistance be coordinated and aligned with the state development goals and CR- SEEDS. To facilitate the attainment of its desires in this regard the State/Partner Note is being developed.

The process of developing the Strategy Note started with Donors/CRS Partnership State Level Planning Meeting Held on April 5, 2006 in Calabar, Cross River State. The meeting was attended by 16 officials in all – Team Leader (Chief Executive - State Planning Commission), Deputy Team Leader (WB representative), one staff each from DFID and USAID, 12 other staff of SPC. One of the decisions reached at that meeting was that a joint Planning Workshop be held for Donors and CRS stakeholders. A two-day Planning Workshop to that effect was held in June 15-16, 2006, the State Coordinator of SRIP was in attendance.

The objective of the Workshop was to “develop a Cross River State/Donor Partnership Note with Result Matrix. “ The agenda of Workshop covered the following: a) Presentation of CR-SEEDS and Update on Implementation by the Vice Chairman of the SPC. b) Presentation of Donor Agencies’ on-going, planned, and proposed activities in the State. c) Presentation of the WB/DFID Country Partnership Strategy as it relates to CRS. d) Parallel Syndicate Sessions on the 3 pillars CPS and Key Programmes of CR- SEEDS – Human Development, Non-Oil Growth, and Governance. The Vice Chairman of the SPC expressed government’s desire to make a great leap into the future of sustainable human development, growing the private sector, and good governance. A re-engineered Cross River Social Charter will be operated and complemented with sound institutional reforms. Service delivery in all sectors will be optimized (through SERVICOM), while access to services and goods will be enthroned at all levels of governance to boost accountability and openness in public governance.

Table 4.1 summarizes the current activities of Development Partners in Cross River State. The activities of six main Development Partners, namely; World Bank, DFI, USAID, EC, UNDP, and CIDA are presented under the three core priority areas of human development, non-oil-growth, and governance. Table 3 shows that all the Partners have activities in the area of human development. World Bank, USAID, UNDP, and CIDA have programmes in the non-oil-growth, and all Donors (except DFID) have activities on governance.

The activities often take the form of capacity building (through training of different types), loans and grants for the financing of micro projects, provision of varieties IEC materials and office equipments, sponsorship of research studies and impact assessments, enlightenment and sensitization campaigns, and so on. The activities are located in the relevant line ministries, departments, and local government areas.

37 The SPC is saddled with the coordination and overall supervision of activities of Development Partners. Effective coordination of Donor initiatives would ensure that Partners pursue their goals with the understanding that they and relevant state agencies share common goals. Proper coordination will Donor activities to be more complementary and less competitive.

Donors should be able to share information on their memorandum of understanding (MOU), work plans, achievement levels, and problems. Situations where two or more Donors conduct workshops for the same category of officers at the same time, or where similar sets of equipments are provided for an institution for the same purpose could be eliminated with proper coordination of Donor activities.

Table 3 - Development Partner Activities in Cross River State (by NEEDS Pillars) Human Development Non-Oil Growth Governance World *Water *State Agric. Support Project *State Governance & Bank *Second Health System Development (planned). Capacity-Building *Community-Based Poverty Reduction *Tourism Dev. Support Programme. *HIV/AIDS Development Programmes (Proposed). *Community Social Dev. Project *Malaria Booster (Planned)

DFID *Strengthening the National Response (HIV/AIDS). USAID *SO 14:Reduced Impact of HIV/AIDS *Improved livelihood in *State Reform Programme (CHAIN) Selected Areas – Cassava *Youth Training (Jobs) EC *MPP6 Micro-Projects SRIP Support to Reforming *PRIME- Partnership to Reinforce Institutions Programme Immunization Efficiency (Routine Immunization Component). *WSSSRP Water Supply and Sanitation State Reform Programme. UNDP *Strengthening the National Response *Energy and Environmental *Protection and (HIV/AIDS). Programme Participation Programme, *Poverty Eradication Programme Project 1: Rights, *Adolescent Health, Participation and Gender Legislation, Protection Empowerment. Services. *Community Development Programme CIDA *Nigeria AIDS Responsive Fund (NARF) *Cross River Environmental *SEEDS Fund *School of Health Technology and Primary Project (CREP). *SPSA Support to Health Care. *Canadian-Nigeria Parliament and State *Strengthening Primary Health Care Environmental Programme Assemblies. (Planned) (CNEP). *BMP Budget Monitoring Project with coalition of NGOs. *CIDA Prgram Support Unit (PSU) Source: Adapted from the Lead State: Initial Assessment (Background Information) (2005), Page 7.

The SPC needs to be assisted to set up a Donor Activity Coordination Unit to handle this important function. The unit should, among other functions, keep track of the activities of all Development Partners in the state. Depending on the scale and duration of a donor’s activities, it may be necessary to maintain desks for each donor programme in the SPC.

38 In addition to gathering and keeping records of donor activities, the Donor Partnership Unit should arrange regular meetings for operatives of donor programmes and projects in the state. At such meetings donor partners and state officials can share ideas and compare notes. In that way the proposed donor coordination unit can evolve the state/donor partnership into a valuable ‘community of practice’ for interaction and socialization of state officials and donor partners.

A functional Donor Activity Coordination unit will offer the SPC and budget office the information infrastructure required to build donor activities into the state MTEF and annual budgets. The situation where some donor activities are not built into state plans and budget is not healthy for the accounting of development partnership.

The SPC, and indeed the state, cannot claim to be on the driver’s seat when there are inadequate information on how and where each donor is intervening. Beyond having information on what each donor is doing, it is absolutely necessary to ensure that operators of donor programmes operate within the mandate approved by the donors. For instance, the SPC needs to evaluate the value of intervention offered by each donor activity; in terms of value added to development as distinct from the cost of administering the activity.

4.2 Coordination of EC Activities in Cross River State

EC currently has four intervention programmes in Cross River State, namely; MPP6 (Micro-Projects), PRIME – Partnership to Reinforce Immunization Efficiency (Routine Immunization Component), WSSSRP – Water Supply and Sanitation Sector Reform Programme, and SRIP – Support for Reforming Institutions Programme.

The overall objective of MPP6 is to help improve living conditions in poor settlements in six states of the Niger Delta (Cross River, Akwa Ibom, Edo, Imo, and Ondo states), on a sustainable. The specific objectives of MPP6 are to improve the quality of and access to basic physical and social infrastructure, create gender balanced income generation opportunities, and micro-finance services on sustainable basis through the provision of: • Water and sanitation facilities. • Transport and Communication (rural roads, wharf, and water transportation). • Health, nutrition, education, and vocational training. • Gender balanced income generation. • Environmental management.. MPP6 has adopted both the participatory and process approach to communities it engages, in the identification, design/planning, implementation, monitoring and evaluation of micro-projects among benefiting communities and other stakeholders.

The key programme outputs of MPP6 include: • Implementation of 2,000 self-sustaining micro-projects in rural, social and economic infrastructure. • Establish a project management committee (PMC) for participatory project management. • Achieve participatory decision-making to inculcate democratic values.

39 • Building the capacity of other partners to deliver sustainable gender and pro- poor services. • Process approach to enable the communities to master each stage/activity process for easy ownership and replication of outcomes. MPP6 activities commenced on 6th May 2003 and are expected to end in May 2008. Benefiting communities are expected to contribute 25 percent of the project cost.

PRIME (Partnership to reinforce Immunization Efficiency) in Cross River State is an EC project in collaboration with the Federal Republic of Nigeria. The project operates in six states (one in each of the geo-political zones) of the federation – Abia, Cross River, Plateau, Gombe, Kebbi, and Osun.

The project has a five-year span, 2003 – 2008. Full operation in Cross River State however commenced from June 1, 2004. The project took off with an initial five local government areas: Akpabuyo, Biase, Obubra, Obanliku and Yala for 2004, and in 2005 Akamkpa, Etung, Bakassi, Obudu, and Boki were added.

The main objective of the project is to strengthen routine immunization services vis-à-vis the following areas: 1) Capacity building 2) Vaccine supply and distribution 3) Renovation of cold stores/health facilities 4) Support to the College of Health Technology 5) Supply of Cold Chain equipments 6) Supply of vehicles, motorbikes, bicycles, boats/engines, and so on. 7) Social mobilization and provision of technical support

The overall objective of Water Supply and Sanitation Sector Reform Programme (WSSSRP) is to contribute to poverty eradication, sustainable development, and to achieve the Millennium Development Goals. The purpose of WSSSRP is to increase access to safe, adequate, and sustainable water and sanitation services in the focal states of Abia, Cross River, Gombe, Kebbi, Osun, and Plateau. Within Cross River State, WSSSRP focuses on urban areas and small towns, and assists both the state Water Board and RUWATSSA with capacity and technical/engineering support in five focal LGAs Boki, Yakkurr, Etung, Obubra, and Odukpani.

The results to be achieved are: 1) Improved water governance at the state and local government areas. 2) Improved water service delivery in urban areas in the six focal states. 3) Water supply, sanitation and hygiene promotion services delivered in a sustainable and integrated manner in up to 1400 rural communities and up to 60 small towns in 25 percent of the LGAs in the six states. Like the other EC initiatives in the state, the main assumption is that government at the federal and state level will remain committed to poverty eradication and consolidation of democratic governance. For WSSSRP in particular clear commitment from the state and LGAs to water and sanitation is paramount. Specifically the state will have to confirm its willingness to: • Reform the water and sanitation institutions in accordance with federal policies.

40 • Co-finance water and sanitation (WSS) projects as per cost sharing formula. • Develop demand driven and participatory approaches. • Establish partnership with LGAs and coordinate and consult with other WSS stakeholders. WSSRP already has a collaborating relation with SRIP in the area of improving water governance in the state and focal LGAs.

4.2.1 Shared Values of all EC Projects

SRIP and other EC initiatives in the state clearly share the following values: 1) Adherence to pro-poor Criteria: EC interventions see poverty reduction as the major intended intervention outcome. 2) Participatory and process approach: EC interventions are conducted in an all- inclusive manner; the contribution of all stakeholders, particularly citizens’ based organizations (CSOs, and CBOs), are paramount at all stages if the project cycle. 3) Transparency and accountability: EC projects have zero tolerance for corruption and misuse of funds. EC projects are conducted in the most all-inclusive manner with all stakeholders actively involved. Reports and accounts are accessible to all stakeholders. The active participation of all stakeholders, particularly citizens’- based organization, is considered of paramount importance. 4) Ownership of EC Projects by Beneficiaries: EC programmes enlist the support and active participation of beneficiaries of all its projects; whether it is in cases where financial contribution of beneficiaries are required (as in the case of MPP6, and water sanitation interventions), or in the form of grants and aid as in the cases of PRIME and SRIP.

4.2.2 Proposals for Cooperation among EC Partners in the State

Current and future EC projects in the state can jointly engage in activities and programmes that would enhance achievement of the core goals of all EC initiatives, namely; poverty reduction and human development, promotion of participatory governance, special concern for children and disadvantaged groups, and promotion of transparency and accountability in the public finance management. Some areas of possible cooperation among EC partners include:

• Conduct of Household Enumeration exercise n the focal LGAs. A critical bottleneck that all EC projects face is the absence of databases on all aspects of economic, social, health, demographic characteristics, and occupational structure of the population in the state. Given the scale, tenure, and diversity of current and future EC involvement in the state, it may be necessary to launch an independent Household Enumeration and Characterization in the state. EC may elect to commence with the focal LGAs of SRIP, and extend it to other areas. EC may however elect to collaborate with the SPC and the PRS departments in the LGAs for the Household Enumeration exercise.

Accurate data and information built in a database that can be updated would aid Donors identify areas of need and the scale of intervention required.

41 • The outcome of such an exercise is a database that would evaluate past EC initiatives, and outline areas that need urgent attention. At present EC can be accused of adopting the same government-type ad-hoc strategies that it preaches against! It is difficult to implement programmes that are fully all-inclusive without a well-rounded database and information infrastructure. EC can take this as a joint project for all EC programmes in the state.

• The publication of a joint periodic newsletter by the EC partners would enhance cooperation and reduce the cost of disseminating information on their independent programmes.

• Regular meetings of all EC partners can enhance their joint success and reduce possible areas of competition and conflicts.

42

CHAPTER FIVE

REFORMS OF THE BUDGET PROCESS IN CROSS RIVER STATE

5.1 Anatomy of the Budget Process Sound budgeting is required for self-sustaining development. Budgets ensure that scarce resources are used effectively and efficiently. The major qualities of a good budget include: • Reflects expectations of the people. • Prioritizes projects according to needs for development. • Is realistic and implemented as passed by the legislature. Budgets in Cross River State have some of these qualities to a large degree. The major constraining factors to sound budgeting in Cross River State include: • Lack of proper coordination between the Budget Office, and the planning research and statistics (PRS) departments in the line ministries, and government agencies. • Lack of a database and information bank in the state. • The PRS departments in the line ministries and local government councils are ill equipped for their assignments. Investigation reveals that many public servants see budgeting in the state as an annual ritual that needs to be done to fulfill all righteousness. In a number of line ministries, appropriated provisions are not released as budgeted. Where funds are released, actual receipts may fall short of the budget provisions. Actual releases may be reflecting when funds are actually released from the Consolidated Revenue Fund. It should be noted however that funds expected from the FAC and IGR that constitute the Consolidated Revenue are expectations that may not be realized monthly as expected or projected; this development may occasion a shortfall in the revenue estimates.

Another weakness of the budgeting process in Cross River State is the high level of fiscal centralization. Actual spending on capital projects is authorized directly by the Governor. Commissioners and Permanent Secretaries of line ministries and agencies are not delegated the power to implement their budgets, despite being accounting officers. When authorization is eventually obtained, another agency or department executes the project, or purchase.

The present system allows the Governor to monitor to the minutest detail how public finances in the state are used. Considering Governor Duke’s personal commitment to development of the state, it is plausible to argue that the current system is simply productive. However, it is equally true that the system can lower the morale of heads of line ministries and agencies, and weaken their commitment to ensuring that approved projects are implemented satisfactorily. The current system does not allow heads of line ministries to see themselves as trusted stakeholders in government.

Another possible problem with fiscal centralization is the precedence it sets for future governance. The tenure of this government is soon ending; it s expected that the next Governor would be as prudence and committed as Governor Duke. Where such

43 expectations are not realized, it becomes easy for a new governor to takes undue advantage of the arrangement to embezzle government funds? This is why it is better to build governance and policies on capacities, incentives, and institutions instead of individuals and personalities.

A sound and participatory budgeting process, with the right capacities and incentives for control and monitoring in budget related institutions could create and sustain a self- regulating system of prudence and accountability. Such systems can compel every one, including the Governor to become prudent and focused. Discipline and transparency in the budget process would ensure that available funds are used prudently to achieve the development goals. Development partners, foreign investors, and the populace would be more willing to support CR-SEEDS when the budget processes are seen to be productive, realistic, creative, transparent, and visionary.

Self-sustaining development in Cross River State and elsewhere would depend on how finance and budget institutions do their jobs. Well-conceived realistic budgets would ensure that projects are prioritized and that no section is neglected. Budgets should equally respect the views and expectations of CSOs and CBOs.

When passed by the legislature and signed by the Governor or Chairman of Council in the case of local government councils, a budget becomes law. This means the amounts of money specified in the budget document are legally binding during that fiscal year. Where the principles of transparency and accountability are respected, agencies cannot spend more than is specified unless they are able to get supplemental or deficiency appropriations through the same legal channels as the original budget.

A budget is more than simply a legally binding financial plan. It is also a multipurpose document that reflects and seeks to serve the information needs of the participants in the budgetary process. In this regard, the budget has three main uses: (1) control, (2) management, (3) planning. A budget controls administrators by tying them to stated policies of their superiors and legislative overseers. Control through a budget is obtained through the accounting and auditing practices and reporting procedures that restrict the transfer of funds from one account to another, limit the number of positions available to a department or agency, and ensure that actual expenditure agree with the provisions.

The control function in Cross River State is the prerogative of the SHA and its Public Finance Committee, State Accountant-General, State Auditor-General, Auditor-General of local governments, the Budget Monitoring and Price Intelligence Unit (BMPIU) (or Due Process) in the State Budget Office, the Inspectorate Unit (for local governments) in the Ministry of Local Governments, and Heads of Audit and Accounts in the various line ministries and self-accounting agencies, the Legislative Councils of the LGAs, and the Accountants and Auditors of LGAs.

The management function of a budget involves efforts to carry out the approved plans and policies efficiently and effectively. The management function ought to be one of the principal roles of the Budget Office assisted by Budget Departments in the line ministries at the state level. At the local government level, the management function should be the role of the Budget\ Inspectorate Unit in the Ministry of Local Government, assisted by the Financial Controller/Treasurer in local government councils.

44 The planning function involves the determination of objectives, evaluation of alternative courses of action, and the authorization of select programmes. Planning provides a broad basis for determining the full financial implications and involvement of specific programmes, and provides the chief executive with information on which alternative to select. Planning in this sense precedes line budgeting. Planning is aggregative because it attempts to capture the entire scope of each programme or project. For instance developing eco-tourism is a major goal of the Cross River State government. It ought to have a programme budget in the holistic sense as a package with different activities and specific projects that cuts across the domain of different ministries and departments.

Programme budgeting at the state level ought to be the major role of State Planning Commission (SPC) assisted by the planning, research and statistics departments in the line ministries and agencies. At the local government level, programme planning should be coordinated by Planning, Research and Statistics department in the local governments and coordinated by the Planning, Research and Statistics department in the Ministry of Local Government Affairs.

5.2 Budget and Planning Institutions: Proposals for SRIP

The specific functions of budget and planning institutions in the state are presented below. The general picture is that: • All SRIP partners have expressed readiness to engage in the reform programme. In particular the Governor has personally, and through the Vice Chairman expressed the readiness of the state institutions for reforms. So to that extent all partners are living up to their mandate. • With regards to ranking on the basis of current level of success with reforms, the partner institutions can be grouped into two categories: catyegory A - those who have considerably met their mandate to a large degree, but are constrained by weak capacities, poor funding, and poor working facilities. Category B – those are trying to meet their mandate, but need major restructuring to enable them meet their mandate more fully over and above the problems of weak capacity, poor funding, and poor working facilities, which are common problems of all SRIP partners in the state. • Partners in Category A in the consultants view are: the SHA (Public Accounts and Finance and Appropriation Committees), Office of the Accountant-General, Office of the State Auditor-General, Office of the Auditor General of Local Governments, Ministry of Local Government Affairs, Office of the Head of Service, Internal Revenue Service (IRS), the Budget Office, and Ministry of Women Affairs and Social Development. SRIP need to assist these reforming institutions with capacity building, equipments and facilities, and IEC materials. • Partners in Category B are: the State Planning Commission (SPC), PRS Departments of line ministries and government agencies, Ministry of Public Utilities, PRS and Finance Departments in the LGAs, and Budget and Public Finance CSO and CBO networks. These institutions are reforming and therefore need like those in category A support in the form of capacity building, equipments and facilities, and IEC materials. But beyond that they still need major restructuring for clearer definition of roles and functions. • All SRIP partners need more training on budget formulation, implementation, monitoring, and budget tracking. Training on the new MTEF is also essential for all partners. 45 • CSOs and CBOs particularly need capacity to engage in shadow budgeting and interpretation of financial reports and audited accounts. • The Press needs to build capacity for reporting the financial affairs of government. • Sensitization is required to implant the culture of budgeting the psychics of the citizenry.

5.2.1 State Planning Commissions (SPC)

The SPC should be the engine room of policy programming and planning. Its primary role is to undertake research and analyze economic and social data. But SPC currently operates under conditions that are not conducive for the productive use of its personnel. Poor funding constitutes a major constraint to operations of the Commission. The Commission depends virtually on paltry monthly imprest that is grossly inadequate to finance it normal operations. In addition, the Commission has out-dated system and models. Accounting processes are still executed manually in this digital era! The Commission publishes a 3- year Rolling Plan that is not subject to legislation.

The SPC ought to play a prominent role in budget planning, monitoring and evaluation. Currently it participates in the Budget Committee that examines proposals/submissions received from line ministries. But modern core competences on budget procedures are inadequate. There is need to train key personnel of SPC on budget planning, bench marking, and budget tracking.

The Statistical Department falls under the purview of the SPC. This Department collects statistics, analyses them, and makes publications. It normally produces a statistical yearbook that contains a summary of statistics of the state. However, the department operates under many constraints, such as poor funding, lack of training, and inadequate equipments, like computers. These constraints make the work of this department difficult. At present the Statistics Department is in dire need of seasoned economists/statisticians who have the capacity and aptitude for data collection and applied research. Modern computers, and Internet and Intranet connectivity are equally required for this department.

Proposal for Reforms of the Planning Machinery in Cross River State

The task of planning agencies at the state and local government levels can be broken down into three major sub-functions; planning, research, and management of information systems. These sub-functions ought to determine the key departments of the SPC and local government planning departments. The planning function is concerned with the structural aspects of programme budgeting. These essentially involve the establishment of a set of categories, projects, or activities oriented primarily toward the ‘ultimate goal’ or expected end-result.

In the planning context emphasis is placed on provision for an extended time horizon – some five, or even ten years. The envisaged MTEF ought to be produced in the SPC first as a programme budget from where the Budget Office can derive its annual line budgets.

The research function is the analytical process. This pertains to various study activities conducted as an integral part of the programme budgeting process. The primary objective of this type of analytical effort is to systematically examine alternative courses of action in 46 terms of utility and cost; with a view to clarifying the relevant choices open to the decision –makers in a certain problem area, and their implications. This calls for empirical studies and surveys, and other means of scientific investigations.

The management information system (MIS) function is aimed at support of the first two functions. The current statistical agency in the SPC can be enriched and repositioned to play this role. The primary aims of information system management should include (1) progress reporting and control, and (2) providing data and information to serve as the basis for the analytical process – especially to facilitate the estimation of benefits and costs of alternative future courses of action.

The progress reporting and control role requires that the MIS department have capacity for tracking of programmes where the major decisions have already been made. The aim is to detect impending difficulties as programmes are being implemented, and to propose remedial actions through a feedback mechanism when the programmes are deemed likely to get out of control in the future. Numerous techniques in the field of operations research are available for dealing with these types of programme management problems.

The SPC is currently coordinating activities of donor agencies. There is need to create a donor fund coordination office in the SPC. Such an office should track activities of donor agencies and ensures that there are no duplications in their projects and operations. It should be possible to know at a glance the commitment of each donor agency, in terms of actual projects executed, impact of their intervention, and the cost implications of each engagement. SRIP can contract a consultant to examine the proposal for reform of the planning machinery in the state.

The proposal for reform of the State Planning Commission process is summarized in Table 4 below:

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Table 4 - Proposal for Reform of State Planning Commission Major Functions Representative Document Capacity Required Planning Function Multi-Year Programme and Local and International Training on Define Objectives, Financial Plan ( MTEF) Modeling, Forecasting, Determine programmes, Econometrics, and Programming; Assign activities to Personal Computers and Lap-Tops; Programmes, and Establish Internet and Intranet connectivity; plan-programme-budget Office Equipments; On-line cycle. Registration for Relevant Scientific Journal; and Exchange Programmes to allow experts acquire world class competence and experience.

Research Function Programme Memoranda Core Competence in empirical Develop cost/benefit including alternatives; Issue research skills; Local and foreign measurement methods; analysis; Special studies. training in relevant computer Identify and Evaluate software usage; Alternatives; Develop and Personal Computers and Lap-Tops Apply Criteria

Info. Systems Function Accounting and statistical Data collection equipments; Create and update reports, Programme change cameras, video recorders, information for planning and proposals. Computers, Lap-Tops, and research; Produce Specialized training in operations programme progress research and management, a reporting systems. Website for SPC, Internet and Intranet connectivity. . Donor-Activity Coordination Function Create and update records Comprehensive record of for tracking the activities of memorandum of understanding, all Development Partners in project estimates, and reports on the state. Arrange regular all donor projects; periodic state/donor clinics meetings reports on the breakdown of for all stakeholders to share income and expenditure of all their mental models. Provide donor programmes in the state; ready contacts for easing information on current areas of possible problems donors critical need for intervention by may have with settling in the development partners. state.

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5.2.2 Budget Office

The Budget Office prepares, monitors, and evaluates the annual fiscal and budgetary estimates of the administration. The Budget Office houses the Tender Board and the Budget Committee. While the Tender Board is responsible for issuing tender rules and regulations to all line ministries, the Budget Committee coordinates the budget process and procedures. The Permanent Secretary of the Budget Office of CRS chairs both the Tender’s Board and the Budget Committee. The Budget Office also houses the Due Process Unit.

To prepare annual budgets, proposals and estimates are received from line ministries and agencies. The incremental budgeting method is used. Budgets are monitored when actual expenditure does not exceed the budget provisions. The budget Office equally reviews the returns from line ministries to evaluate the overall budget performance.

At present, work of the Budget Office is constrained by lack of facilities and working equipment. Poor offices furniture and equipment, lack of personal computers and lap-tops, non-availability of the relevant budgeting software packages, weak capacity for budget and financial analyses, obsolete budget manuel, absence of a database for budgeting, lack of Intranet connectivity with other budget institutions and line ministries, and low work morale are the major constraining factors. Currently the Budget Office need support to produce the state’s Fiscal Strategy Paper, Due Process particularly needs to update its price list regularly to enhance its work.

Proposal for Reforms of the Budget Process

Appropriate software could be acquired for budget preparation. Training could be provided for budget officers to understand and use the proposed software for policy simulation, budget preparation, and budget execution. A website could be developed to disseminate the budget monitoring reform initiatives and contract processes. The website would also become a source of information for CSOs. This will open the budget process to public participation.

A system for checking Due Process in the line ministries to ensure that the award of contract for any jobs complies with standard norms and practices could be developed for the Budget Office.

The Budget Office should be supported to adopt the Medium Term Expenditure Framework, instead of incremental budgeting. In this perspective, training sessions could be organized to focus on modern budgeting management. The training programs may comprise of sessions covering the legal and institutional framework for budget management, and various stages of budget preparation and implementation. Participants to the training programs could also be exposed to diverse methodologies for budget performance tracking and monitoring.

49 5.2.3 Ministry of Finance

The Ministry of Finance keeps all the financial records/transactions of the State Government. It liaises between the Federal Government and other financial institutions in financial matters/obligations. The Internal Revenue Service (IRS) operates under the aegis of the Ministry of Finance (MOF).

The IRS is saddled with the task of ensuring that Internally Generated Revenue (IGR) that accrues to Cross River State Government is collected.

Proposal for Reforms of the Ministry of Finance

The support that could be extended to the MOF and IRS are follows:

• Establishment of State Debt Management Office.

• Establishment of the State Revenue Intelligence Unit.

• The IRS needs to be assisted to develop a database that enables it to make realistic revenue projections, which is essential for budgeting.

• Support its ongoing computerization, and train some of her personnel on computer software like excel, word, power point, and so on.

5.2.4 Office of the State Accountant-General

The State Accountant-General receives the state's share of federal allocation. It is also responsible for the disbursement of government funds, and pays money meant for pensioners through designated banks. It equally produces monthly revenue returns to the Ministry of Finance.

As regards enforcement of proper policies on procurement, the Accountant General ensures that all line ministries have in-house procurement officers whose tasks are to properly certify the amount of work done, or projects completed. Funds are released when the procurement officers certify the assignment completed. Disciplinary actions are taken against those who default by giving wrong certification. The State AG of course ensures that all payments receives the Governor’s authorization

Proposal for Reforms of the State Accountant-General’s Office

• An Intranet system to link the Office of the Accountant General, Budget Office, the Head of Service, Auditor-General, SPC, Heads of Accounts and Audit in the line ministries, Auditor-General of local Governments, and Ministry of local government. • Software design and the full computerization of the State’s Final Accounts.

50 • Capacity building to support the desire to shift from the old GAAP system to the more modern XYZ accounting system. The retraining of the accounting staff to familiarize them with the new accounting system is necessary. • Training is also required to familiarize the State Accountant-General office with MTEF and what new ground rule are envisaged. • Purchase of cars, stand-by generators, and working equipments like fireproof cabins, photocopiers, office furniture, and so on would enhance service delivery in the Accountant-General’s Office.

5.2.5 Office of the State Auditor General

The State Auditor-General audits the public accounts of the State as prepared by the Accountant-General. It also undertakes periodic checks of all government corporations, commissions, authorities, and agencies. After the State Auditor-General examines the accounts, they are sent with a report to the State House of Assembly (SHA), where the Public Accounts Committee further scrutinizes them.

Audit function occupies a significant position in the administration of public finance. It is the watchdog of government financial resources; its main objective is to ascertain truth or fairness or otherwise of financial transactions and the financial positions of Government.

The Audit Department comprises the System Audit and Enforcement Units. While the System Audit Unit looks at the computer aspect of government operations and also reviews the payroll system that government adopts, the Enforcement Unit attends to all audit queries and clarifications from the SHA.

It is common knowledge that for several years, the Audit in the State was not able to discharge its function effectively due to various factors; namely poor funding, lack of mobility, value disorientation, inadequate office accommodation, lack of exposure to modern techniques and training. Often auditors are compelled to adopt a self-defeating approach by not upholding high ethical values and integrity.

The effectiveness of value-for-money Audit cannot be felt due to poor funding of the Auditor-General’s office. The department of Project Monitoring and Evaluation, which is meant to carry out this function relies solely on its clients for transport facilities, and materials. The situation totally defeats the essence of audit control.

The Audit Enforcement Unit is unable to fully discharge its role, as it should due to lack of funds, equipment, and capacity. In view of this, it has accumulated a backlog of cases. An area where SRIP can possibly assist is to build up capacity of the personnel so that they are made aware of the modern auditing techniques. The Enforcement Unit must be able to raise an audit alarm when fraudulent cases are reported or observed. This will render the system more transparent.

The Audit Department is seriously hampered in its work by inadequate computer equipment and computer literate personnel. SRIP could consider building capacity in computer equipments and computer literacy. Auditors would need to be adequately exposed to training to enable them continuously update their skills. More competence in auditing is urgently required. A consultant could be recruited to assess the exact training

51 needs required. The consultant could also recommend the appropriate audit software needed to keep pace with international standards.

Other major constraints of Office include: • Poor office accommodation and working environment. • Lack of vehicles for inspection. • Poor remuneration has made it difficult to recruit, retain and motivate qualified auditors and accountants.

Proposal for Reforms of the State Auditor-General’s Office

In the last benchmarking exercise (2005), Cross River State scored badly in terms of carrying out value-for-money audit. This, therefore, calls for an overhaul of the entire audit process to cope with changing public expectation. Among other things, the office requires the following:

• An office block with enough space for staff and officers to do their jobs successfully. • Strong vehicles should be provided to ease movement around the state. • Provision of IT equipments to enhance effective reporting and dissemination of audit reports to end-users. • Train Auditors on how to develop a budget-tracking framework for the state.

In addition to the above interventions, it is necessary to build an Intranet network to link the Auditor-General’s office with the SPC, Accountant General, the Budget Office, and Heads of Audit and Accounts in the line ministries and agencies.

5.2.6 Office of the Auditor-General for Local Government

The Office of the Auditor-General for Local Government is responsible for auditing the financial accounts of the 18 local government areas (LGA) in Cross River State. It therefore acts as a watchdog of funds allocated to local governments. It normally undertakes quarterly audit and reviews of transactions in the local government areas. After considering all audit queries the audited reports are finalized and sent to the SHA for approval.

The Office is constrained in its task by poor funding. This prevents it from carrying out a full-scale audit missions to the LGA on a quarterly basis. The Office of Auditor-General for LGA should be adequately funded to enable it perform its roles creditably. With the limited resources at their disposal, it is not possible for them to carry out their audit assignments as required. The Office had on many occasions asked the LGA to arrange for accommodation and transport to save costs, which dilutes the presumed independence of auditors.

52 Proposal for Reforms of Auditor-General of Local Government’s Office

• The Office of Auditor-General of local government requires a larger and permanent office block to enhance its capacity to perform. • Sponsorship is required for regular audit missions. Such missions enrich the auditing process and enhance the scope for the judicious use of the funds allocated to the LGA. • Auditors should be completely independent. Everything that weakens their capacity to be autonomous should be avoided. • The envisaged Intranet and Internet connectivity, and website for the state should be extended to Auditor-General of Local Government. • The auditors also need capacity building in the area of auditing software. On- the- job-training may be considered for a specified period of time. This may necessitate computerization of the office. Customized software to facilitate audit verification of transactions would enable the Office of the Auditor to draft their report in a timely manner, with greater degree of professionalism. • The Office needs fireproof cabinet to preserve all documentary evidence in the event of an outbreak of fire.

5.2.7 The State House of Assembly (SHA)

The SHA enacts or rejects legislation affecting public policy, provide for collection of levies and taxes and other revenue to support state and assist local governments, appropriate funds to implement public choices, and monitors the use of public funds.

The Public Accounts Committee (PAC) of the SHA scrutinizes both the State Auditor’s Report, and Office of the Auditor General for Local Government’s Report, while the Finance, Appropriation and Due Process Committee scrutinizes budget proposals sent by the Governor and makes recommendations for eventual passage of the appropriation bill into law by the SHA.

Good working knowledge of budgets and capacity to interpret economic plans and financial reports are essential for the members of SHA to contribute effectively to the budget process. The SHA is also in dire need of personal computers, laptops, and training on how to use the relevant software. Vehicular support to aid inspection and assessment visits to local government areas are also required.

It is ironical however that Honourable members are themselves are unable to appropriate budgetary provisions that would ensure that the major requirements for them are provided.

Proposal for Reforms in SHA

• In depth training on budget work and interpretation of financial reports is vital for all SHA members, and particularly members of the Appropriation and Public Account Committees. Some of them do not have an accounting background and so are unable to properly examine audited accounts and ask meaningful questions. • More budget and financial analysts are required to support budget work and control in the SHA.

53 • More ICT training and hardware are required. The SHA should be linked to the state website and the proposed Internet and Intranet connectivity. • Exchange programmes with other legislative assemblies in the larger democracies can expose Honourable members to best practices in their jobs. • The envisaged website and Intranet connectivity for the state should link the SHA with line ministries, agencies, and relevant departments.

5.2.8 Head of Service

The Head of Service maintains staff records and training of personnel in the state. SERVICOM is also located in the Office of Head of Service. Given the current high personnel cost and the need to reduce all forms of waste, it is necessary to maintain authentic records of public servants. Such records would aid in reducing possible cases of ghost workers, and allow policy makers to determine at a glance when a particular staff is due for training, promotion, or retirement.

It should also be possible to determine how to right-size the public service by transferring personnel from where they are underutilized to departments that need their services. The job description of certain positions may equally need to be reviewed from time to time.

Regular and relevant training is essential for enhancing the productivity of public servants. It is necessary that training budgets for the entire public service be prepared based on submissions of training needs from the personnel departments of line ministries and agencies.

Proposal for Reforms in Office of Head of Service

• Database for all employees, their qualifications, salaries, entry and eventual exit dates, training received, and so on, would need to be produced and updated regularly. This is not the same thing as the payroll. • The capacity to develop a training plan would need to be developed. Training, computers (hardware and software), communication equipments, Internet and Intranet connectivity are equally required. • To enhance the capacity of the state to retain experts with core competence in the skill-intensive and technology areas, it may be necessary to design varying conditions of service for different categories of public servants. It may be necessary to hire the services of a consultant to produce and justify such variations in salaries and conditions of service. • Training programmes for prospective retirees (comparable to Armed Forces Resettlement Training) can be arranged to equip potential retirees with the skills, information, and capacities to enable them invest their retirement benefits and time wisely. It may indeed be necessary to establish a Public Service Resettlement School in the state. A consultant can be contracted to produce a working document for establishing such an institution in the state. Addressing the problems and fears of retirees is essential for social security and poverty reduction.

5.2. 9 Ministry of Local Government Affairs (MLGA) The Ministry supervises the activities of the 18 local government councils in the state. As it relates to budgeting and attainment of the goals of CR-SEEDS, the MLGA in 54 conjunction with the SPC supervises the annual budgets of local governments to ensure that projects that affect the poor are emphasized. The monitoring of LG budgets by the MLGA is effected by its Inspectorate Department. The MLGA is constrained in executing its various assignment by the following: • Lack of adequate vehicles to enhance regular inspection visits to the LGs. • Poor staffing of the Inspectorate Department. • Inadequate computers, printers, cameras, and other working tools. • Lack of Databank and other information bases to enable the evaluation of performance of LGs.

SRIP can support the MLGA in the following ways: • Arrange training programme to build capacity in budget work and planning for staff of Inspectorate Department; and PRS department in the MLGA, and Budget and Planning officers from the 18 LGAs. • Engage a consultant to build an information base for local governments in the state. • Assist MLGA with personal computers, and ensure that the ministry is linked to the envisaged Internet and Intranet connectivity.

5.2.10 Selected Local Government Areas

Boki Local Government Area Boki Local Government Area is located in the northern senatorial district of the state. The headquarters of Boki LGA is Boje. Access roads to Boje from all sides are very poor. There are no GSM services, electricity supply is epileptic, and potable water is at present inadequate.

The people engage mainly in farming, fishing, and hunting. Forest resources like timber and firewood are abound in Boki. Some portion of the world’s major rain forest that needs to be preserved is in Boki LGA. Roads linking the headquarters to other parts are in very bad shape. Some roads can only be access by bicycles and motorcycles. It could cost as much as N5000 to journey from some villages to Boje the local government headquarters.

Boki is of strategic global, national, and state interest. Globally the need to preserve the remaining rain forests calls for global concern for Boki and its biomass dependent people. The people currently depend on the forest and its products for their livelihood. Excessive pressure on the forest arising from poor economic conditions and the absence alternative means of livelihood can lead to lose of a treasured global environmental resource.

Second, certain parts of Boki have international boundaries with the Cameroon. It is therefore of strategic national interest to monitor the movement of people and materials across the boundaries in that area. Poor accessibility by road can become a major undoing in the event of emergency or military conflict.

Third Boki shares the same mountainous terrain with Obudu and can readily be integrated into the tourism matrix of Cross River State. These concerns make the prompt development of Boki necessary and essential

55 Budget preparation in Boki as in other LGAs in the state is based on guidelines issued annually by the Ministry of Local Government affairs. The council often needs merely to reduce or increase provisions for some expenditure heads based on the requisition of unit and departments in the council.

The financial controller, the internal auditor, and the LG legislative council handle the financial control functions internally. The auditor-general of local governments, inspectorate unit of MLGA, and the Public Accounts Committee of the SHA place external checks on public finance management of Local Government Councils. The Chairman submits monthly reports concurrently to the LG legislative council and the Public Accounts Committee of the SHA. CSOs do seem to play any role in the budget process. No CSO is involved in budget work in the LGA. It is expected that individuals and communities can register their views and complaints to the council through their elected representatives in the legislative council of the LGA.

There is a Tender’s Board with the Chairman of Council as chairman, and all heads of departments as members. There are no SERVICOM and Due Process units in the LGA.

Other EC projects PRIME, MPP6, and WSSSRP are intervening seriously in the LGA. Interventions in the water and sanitation have complemented the efforts of other donors and the LGA. WASH-COM exists for community governance of water and sanitation projects. Selection of members of the WASH-COM is gender sensitive.

The PRS department needs to be empowered with more facilities and training for planning, research, and data collection. The Finance and Accounting departments need replacements for staff members that were posted out to the Ministry of Education. A standard electricity generating set, computers, photocopiers, and other office furniture are required by the LGA. Boki, particularly Boje the Headquarters, need GSM and Internet services to ensure that its people are not cut off from the rest of the state.

Yakurr Local Government Area

Yakurr is located in the Central Senatorial District of the state. The headquarters of Yakurr, Ugep, is located along the Calabar-Ikom road. There are GSM services and the headquarters is quite accessible from Calabar. The people are mainly farmers, producing and selling cassava (and its related products principally garri), yams, plantain, and banana.

The process of budget preparation in Yakurr is not particularly different from that of other LGAs in the state. What perhaps distinguishes Yakurr from Boki is the accessibility of its headquarters by road to other communities in the local government area, allows for more concern of the populace in the activities of the local government council. Such concerns however are yet to cause the emergence of registered budget and public finance CSOs.

The Council manages the people’s quest for information on its activities by arranging monthly galleries where government presents its income and expenditure profile, programmes, and successes. In Yakurr too Tenders are advertised in notice boards that are strategically located at the reception in the LG premises. There are however no SERVICOM and Due Process units.

56 Like in other LGAs in the state, the areas of critical need include: Internet and Intranet connectivity, electrcity generating sets, computers to aid computerization of the finance and PRS departments, and other office furniture. Training programmes that are relevant for developing capacity for research and planning, and financial management are equally required.

Women groups are very active, and women are well represented in the WASH-COM arrangements. WSSSRP is actively supporting the initiatives of other donors, RUWATSSA, and the local government in water and sanitation projects.

Odukpani Local Government Area

Odukpani is located in the southern Senatorial District of the state. Out of the five focal LGAs, Odukpani is the closest to Calabar. The Council headquarters is fairly urbanized. The local population engages mainly in the cultivation of food crops like cassava, plantain, banana, yam and cocoyam, and vegetables like Okro, waterleaf, pumpkin, and so on.

The LEEDS document is based on the development aspirations of the local government, but its implementation is often constrained by pressures on LGAs by the state and federal government. For instance local governments can be instructed to provide from their resources, furnished office accommodation for national agencies like Independent National Electoral Commission, National Population Commission, etc, which constitutionally are exclusive responsibilities of the federal government. The state government too puts such unbudgeted demands on local governments, without an agreement on how such expenditure may be reimbursed.

The closeness of Odukpani to Calabar notwithstanding, CSOs are virtually unknown in Odukpani. The local government affect lives of its rural people directly through the respective community based organization, who are required to make written requisitions to the local governments through their elected representatives. Several women groups have benefited from such assistance and aid.

5.2.11Proposal for Reform of Local Governments

Local governments form the third tier of government in Nigeria. They share in the FAC and state’s IGR. In practice, the some ambiguities exist with regards to the relationship between local governments and the state government. While the constitution directly identifies the existence of local governments, it equally gives state governments supervisory powers over them. Where the powers of the states and federal governments on local governments starts and end has remained an unresolved constitutional issue.

Local Government Councils in Nigeria cannot be said to have achieved the mandate of reaching the grassroots effectively as a tier of elected leaders because of the over-bearing influence of the state on their affairs. In nearly all the states, the SHA by the enabling supervisory laws it passes, can suspend or sack a local government council chairman.

Such supervisory laws sometimes deny the elected LG leaders the right to fair hearing. If the Audit Report for instance finds a Council Chairman guilty of embezzlement, and the Legislature at the Council level sees nothing wrong with that, then he/she ought to be 57 reported to the Police, ICPC, Code of Conduct Bureau, or EFCC. Since the LG Chairman has no constitutional immunity, he/she can be investigated, interrogated, and prosecuted in the relevant courts. Creating rules that allows for change of LGA leadership by non- judicial means defeats the very purpose of having a third tier government.

What is required to stabilize LGA administration are systems of financial controls to ensure that powers are not abused or funds misused, and when such cases arise culprits are easily identified in time and treated in accordance with the relevant laws. In that regard, it is necessary to set up nationally coordinated Due Process Units in LGAs. Indeed Due Process at the federal, state, and local government levels ought to share their periodic reports with ICPC, EFCC, and Code of Conduct Bureau who can investigate such report and charge erring officers to the relevant courts of law. Due Process can equally check the excessive and unconstitutional demands placed on LGAs by states and federal government agencies. States and the federal government can delegate functions to LGAs because their closeness to the grassroots, but there ought to be concrete agreement on when and how the full cost of such delegated functions would be refunded.

The idea of a unified salary system for local government employees was understandably borne out of the need to check situations where some local government councils owed salaries for months. Yet it is more expedient, and sustainable in the long term, to create financial control measures that checks eliminates situations where LG Councils divert workers’ salaries than for a State government to add to its numerous functions what ought to be functions of the local government in any guise. The anomalies in the past can be overcome with the right capacities, incentives, and institutions instead of brute unconstitutionality and ad hoc procedures.

The issue of joint projects requires another look in the light of current reforms. Each local government ought to be given the opportunity to decide on projects they can implement jointly with the state or federal government. It is absolutely wrong to withdraw money at source from LGA accounts for projects that are not located in their domain.

5.2.12 Civil Society Organizations (CSOs)

CSOs are essential for good governance and the productive management of public funds. CSOs as representative of the populace should have capacity and opportunity to participate in budget preparation, monitoring, and evaluation. In the preparation stage, CSOs can independently sensitize the populace and identify their needs. Information obtained from sensitization programmes can be used to produce ‘shadow budgets’ that represent the input of CSO community to budget preparation. CSOs can monitor budgets by tracking public spending to ensure that budget provisions are implemented satisfactorily. CSOs can set up yardsticks for assessing the impact of each year’s budget on specific projects that affect the populace.

The performance of CSOs in budget preparation, monitoring, and evaluation depends on the one hand on the technical capacity of CSOs and level of coordination among CSOs that specialize in budget work and transparency in public spending, and on the other hand on readiness of government and budget related institutions to accept CSOs as stakeholders in the budget process.

58 At present, budget related CSOs need support to form communities or networks for independent budget monitoring. Budget institutions in the state need to integrate CSOs fully into the budget process. These two sets of ingredients are the bases for the proposal for reforms in this regard.

Proposal for the Integration of CSOs into the Budget Process in Cross River State

• SRIP can support the establishment of a network or community for CSOs engaged in budget work. A consultant can be contracted to produce a working document on how that can be achieved. • Advocacy can be extended to budget related institutions to create desk offices for coordination of the activities of CSOs, and allow them access to the basic information they need to work. • SRIP can launch a website for CSOs. A consultant can be contracted to design reporting formats that the relevant budget institutions can fill periodically to update the information base of the website. • CSOs can be trained on the techniques for independent budget work and project appraisal. • Training should be organized for all budget institutions at the state and local governments’ level to sensitize them on the roles of CSOs in democratic societies. • SRIP could support the production of Information, Education and Communication (IEC) materials that would help to disseminate information on budget processes especially at the grass root level. Such materials could be translated to the local languages for easy understanding and comprehension.

5.2.13 Ministry of Women Affairs and Social Development

Major goals of this Ministry include: • Ensuring that, women, children, and the physically challenged have opportunities to utilize their potentials optimally through direct intervention. • Establish women-specific skills centers to offer training for self-employment: Provision for this is in the proposed 2007 budget estimate. • Ensure legislation to end all forms of violence and exploitation of women and children: The Child Act when signed into law provides for Child Right Committee in all Secondary schools in the state. Child Trafficking is now an offense, and anti- trafficking Committee with the Permanent Secretary, Ministry of Women Affairs as chairman now exist in the state. • Build Orphanage Homes and Dormitories for orphans, and skill acquisition centers for physically challenged: Calabar dormitory has been built and at present receives subventions from state government. Other dormitories for Ikom and Ogoja have been budgeted for. • Sensitization exercises on HIV/AIDS prevention, and support for those living positive are on going. Mainstreaming of gender is also on going.

Possible support areas for the Ministry of Women Affairs and Social Development include: • Promote Mainstreaming of gender issues, and providing support for policy dialogue between women groups and policy makers.

59 • Assist the PRS department in the Ministry with the financial, equipment, and training support to enable it create and maintain a database on women activities and challenges in the state. SRIP can sponsor a baseline study on women, children, and social groups in the state. • Building of a skill acquisition center to train the physically challenged on different skills like – shoe making, sewing, etc. and equip them thereafter. • Conducting Advocacy for women to enhance their interest and chances of political participation.

5.2.14 Mainstreaming Gender and Concerns for Disadvantaged Groups

Cross Riverians; men, women, and children no doubt share the common problems of unemployment, poverty, and generally low standards of living. Yet it is broadly accepted that the burden of subsistence for many families in the state is culturally more on women. Considerations fore women became stronger globally after the Beijing conference of September 1995. The Donald Duke led administration has taken a number of deliberate steps to improve living conditions of women, children and the disabled. But women groups in the state still advocate for a number of reforms. The major demands include: • Increase school enrolment for girls. • Widening the coverage of health services for women. • Formation/mobilization of more specialized NGOs and women groups. • Empowerment of women through skill acquisition. • Passage of bills to protect the women and girl child, etc. Government has already responded to these demands in various ways. But like in several other developments in the state, changes have been more agents’ driven – women projects are seen more as pet projects of the Governors wife, and wives of LGA chairmen instead of well-drawn programmes of government.

As administrations change in Nigeria, the names and, focus, and agenda of women programmes would change. This posture has severe implications for their continuity and sound planning. Issues that relate to gender, children, and the disabled are yet to be mainstreamed at all policy-making levels.

There are still no policies that guarantee the treatment and representation, or employment opportunities for women and the disabled. There are no statutes, by-laws, and policies to facilitate in practical terms the allocation of resources to investigate and address perceived gender biases. Many women, children, and the disabled still lack information and opportunities to benefit fully from programmes available at present. Gender issues and programmes are yet to descend from the heights of perception and propaganda to the realms of policy and practice.

Some of the areas that gender mainstreaming should address include: • Empowerment of women in agriculture: women contribute 60-80 percent of agricultural labour. However agriculture budgets and land reforms are yet to be gender sensitive. There are no clear laws, statutes or policies apportioning farmlands and farm inputs to women. • Comprehensive studies of the gender situation and the needs of each group are required for gender mainstreaming. The approaches adopted at present rely on

60 guesswork and past experiences. The proposed household enumeration can provide a major information base for gender mainstreaming.

• Removal of cultural biases that limits opportunities for women in politics and governance. Many people particularly in rural areas and small towns that produce export goods like cocoa, timber, and oil palm may still be seeing girl education as a net loss to her parents, and would rather prefer to use their services in farms than send them to schools. The erroneous view that girl education benefits her future husband more than the parents in stil strong in many commercialized communities. Under such cases conditions the girl child need a lot of sensitization, financial support, and legal reforms. A complete programme for women empowerment is required to redress this and other biases that affect women adversely.

• Similar situations in South Korea were redressed in the 1970s and early 1980s by making education compulsory for mothers. It became a punishable offense for a mother to be illiterate. Of course the state provided opportunities for continuing education with flexible learning/tutoring hours. Mothers are often closer to their children are early stages of life; compulsory education for mothers made them appreciate easily the value of education and, naturally, the need to educate all their children. Today South Korea has almost 100 percent literacy! Early education for all children has become institutionalized and the South Korean government no longer needs to compel anybody to go to school.

• Poverty remains a major impediment to women development. Literacy alone cannot alleviate poverty. Learning new skills and having equipments to use them to produce marketable goods should particularly be incorporated into the programme for continuing education. It is easier for women to overcome, outgrow, or resist inhibitive cultural practices when they have capacity to create wealth.

5.2.15 Water and Sanitation Sector: Rural Water Supply and Sanitation Agency (RUWATSSA)

The current goals of RUWATSSA are: • To drill and install, repair, rehabilitate, and maintain (RRM) boreholes and water projects mainly in rural areas particularly in targeted LGAs – Obubra, Etung, Boki, Yakurr, and Odukpani – as pilot scheme, but would eventually be extended to other LGs in the state.

• Sanitation intervention involves hygiene promotion through; hygiene education, and building and maintenance of VIP latrines in the target LGs .

• The programme of the department is summarized as WASH –water supply, sanitation, and hygiene, and WASH-Com, which seek to strengthen the capacity of communities to maintain repair, rehabilitate, and maintain the projects themselves.

• Water projects are given more attention because of their technical intricacies, but LGs are encouraged to handle sanitation projects. Efforts are made to mainstream

61 sanitation in LGs – a law would soon be passed to compel all LGs to have water and sanitation departments.

• RUWATSSA in collaboration with the European Union (EU) and UNICEF has drilled and installed 8 motorized boreholes equipped with solar pumps and constructed 16 Nos. 5-compartments Ventilated Improved Pit (VIP) toilets in 8 selected primary schools in the State.

• Under the same EU assistance, 80 out of the projected 141 new hand pump fitted boreholes have been drilled and installed in 5 selected Local Government Areas – Odukpani, Yakurr, Obubra, Etung and Boki. In addition, 10 hand pump boreholes have been drilled in guinea worm endemic communities of Obubra.

• Under the State Government’s direct rural water supply initiative, 35 new hand operated boreholes and mini-water schemes have been constructed across the State, particularly in guinea worm endemic areas. Some of these are to serve prisons and military establishments. The Uyanga semi-urban water scheme has been completed and waiting commissioning while extensive work is going on with respect to the Old Netim water project.

• In the area of repairs, rehabilitation and maintenance (RRM) of broken down boreholes, 92 boreholes have been repaired and redeveloped to add to the present functional stock in the State, courtesy of the Tulsi Chanrai Foundation of India. As part of the Repairs, Rehabilitation and Maintenance (RRM) programme, 462 local artisans and mechanics have been trained and equipped with various tools and gadgets to assist their communities in the regular repairs and maintenance of broken down boreholes to ensure sustainability of the rural water supply programme.

• It is hoped that the application of their newly acquired skills will empower them to earn a living from their services; this development thus contributes toward the reduction of poverty. The ownership of the rehabilitated boreholes has been transferred to the various Water, Sanitation and Hygiene (WASH) committees in the communities where these are located to ensure sustainable management.

• Using the Global Positioning System (GPS) Technology, RUWATSSA has carried out the satellite mapping of all the water supply and sanitation facilities in the 5 focal LGAs. The Agency has also established 40 sani-centres as spare part outlets for the sale of hand pump spares in addition to the training of 400 local sanitation artisans in the construction of low cost technology options for sanitation.

A major problem encountered by RUWATSSA and other interventions agencies in the focal LGAs is the readiness of community members to fully accept the interventions and adopt the innovations offered. Instances exist where water projects are abandoned shortly after commissioning, and VIP latrines are not used. More education and sensitization is needed to promote interest among community members. Other problems include; accessibility of the innovation to the people in non-benefiting communities, cultural

62 inhibitions, poverty and low economic status, and low educational status of many rural people.

5.2.16 Proposed Reforms in the Water and Sanitation Sectors

At the level of state policy, a well thought out programme for the water and sanitation in the state is required. The roles of Water Board, RUWATSSA, Ministry of Public Utilities, and Ministry of environment, and municipal environmental sanitation agencies across the state needs to be streamlined to avoid competition, duplication of functions, and promote complementary relationships among key institutions in the water and sanitation sector.

The present Water Board Limited may need to be renamed as a profit driven joint venture of government and other private partners. Such a company may have to restrict its function to urban areas and growing towns where people are willing, or can afford, to pay for potable water. A Water Board with its traditional functions of intervening in water supply to rural communities, villages and shanty settlements, and disease endemic and poverty stricken areas can be created as a parastatal of Ministry of Public Utilities to take over the water related functions of the Ministry, and the rural water functions of RUWATSSA

A State Sanitation Agency can be created as another parastatal of the Ministry of Public Utilities to takeover the current sanitation functions of the Ministry, the sanitation functions of RUWATSSA, and the sanitation functions of the Ministry of Environment. These restructuring of the water and sanitation sector at the state level can be replicated at the municipal and local government levels.

Another parastatal that may need to be established out of the current Ministry of Public Utilities is the Electrification and Communication Agency. This new agency can take over all the electrification functions of the Ministry, and add to it the role of ensuring that the entire state is systematically hooked to the services of all GSM providers. The agency would equally ensure that the entire state, beginning with LGA headquarters have Internet services. The department for electrification and communication can also be created at the LGA level.

With the above reforms implemented, the Ministry of Public Utilities would need to concentrate more on broad policies, budgeting and planning, and project inspection and monitoring. These reforms would ensure that no aspect of the water and sanitation sectors suffers from neglect of any kind. Moreover professional bases would be created for specialized assistance and donor activities to cover the areas of critical need in either the water of sanitation sectors.

SRIP can support the Water Supply and Sanitation initiative in the following other ways: • Advocacy for the passage of relevant sanitation and environment laws by the SHA. • Support public enlightenment initiatives in benefiting rural communities. In this regard sponsor the printing of information and educational materials, and radio and television jingles in Pidgin English and local languages educate people in targeted rural communities.

63 • Support the Programme Monitoring and Evaluation department to conduct baseline studies and create feedback mechanisms on the effectiveness of interventions.

5.3 Selected Related Service Institutions

5.3.1 Ministry of Health The vision of the Health sector is to create first class health services that are comparable to the best in the world. The goal is to improve the health and socio-economic status of Cross Riverians and other residents through provision of qualitative Health Care Delivery System.

The health needs of the state falls into the primary, secondary, and tertiary health care as specified in the National Health Policy. The problems to be addressed include; child health, maternal and reproductive health, HIV/AIDS health sector response, malaria control programme, TB control programme, neglected tropical diseases and emerging conditions, and non-communicable diseases.

The National Sentinel Survey of December 2003 on the spread of HIV/AIDS painted a gloomy picture of the State, giving it the first position in the country in the incidence of the spread with 12%. Since then government has carried out far reaching changes of SACA activities, including a home grown strategic Multi Sectoral Work Plan in 2005. This has paid-off as the prevalence rate fell to 6.1 in 2005. CR-SACA is now leading the campaign for universal access by December 2006.

Government has also acquired and distributed ambulances to several health establishments in the state to facilitate logistics for containment of emergency conditions.

Apart from inadequate funding, which is a general problem in the state, the specific problems of the health sector include: • Lack of database on the health status and disposition of Cross Riverians. The HMIS needs to be updated regularly. There is also need for baseline studies to assess the impact of interventions. • The minimum package for health care delivery; in terms staffing, training, logistics, and operational support is inadequate.

SRIP can support healthcare delivery in some of the following ways: • Sponsor baseline studies on impact assessment and perception of healthcare delivery systems in the state. • Support the development of a database for PRS department of the Ministry. • Support the work of the PRS department with computers office equipments, and training on modern health systems planning techniques. • Ensure that the Ministry is linked to Internet and Intranet connectivity, and the proposed website for the state.

64 5.3.2 Ministry of Education

The primary goal of this ministry includes: • Provide and ensure access to free basic education in the state. • Expand and improve infrastructure and improved quality of teaching and learning. • Expand and improve school health, sanitation and safety. • Provide Basic Science Laboratories for the teaching and learning of Science. • Provide comprehensive reading materials for students and teachers at the basic and secondary levels. • Strengthen Education Management Information System (EMIS) and improve education statistics. The major achievements of the Ministry so far include: • 50 percent of existing educational infrastructures across the state are being renovated. • 100 multi-purpose laboratories have been constructed and fully equipped. • 1000 classroom renovated, and one pupil/student to a book ratio attained. • HIV/AIDS issues, sanitation, and tourism are now essential components of the school curriculum at the basic and secondary school levels. The areas of possible support by SRIP include: • Sponsorship of studies/surveys to assess the achievement of the Ministry in terms of its core goals, and identify current educational needs and problems. • Build capacity for improvement of Educational Management Information Systems (EMIS) to aid future planning of education and ease regular assessment of performance. • Build capacity through training and supply of office equipment and computers in the budget, PRS, and Inspectorate units of the Ministry. • Link the Ministry to the proposed website, and Internet and Intranet connectivity for the state. • Support programmes for special education, education for the mentally and physically challenged, and early child education. • Sponsor the purchase of books to update the stock of reading materials in the state library.

5.3.3 Tourism Bureau

The Tourism Bureau coordinates eco-tourism programmes in the state. Tourism is one of the two key sectors of natural advantage that the State identified for its development. Tourism development is the flagship as it has attracted substantial investment with the wide acclaim and endorsement it has continued to receive within and outside the shores of Nigeria.

Investment in tourism focuses on the key prospect of creating a vibrant non-oil economy for the state, enormous opportunities for employment generation, and entrepreneurship and wealth creation. It is estimated that tourism development programme has already generated over 5000 jobs with over 3000 of these attributed to TINAPA alone.

At the completion of Tinapa, over 30 thousand Cross Riverians will be employed, thus pushing Public Sector Employment in the State to second place. More critical are the 65 various skills that tradesmen and artisans will acquire in the course of the implementation of these projects. They will thus provide a pool of relevant manpower that will satisfy the manpower needs of the new economy of Cross River State, a development that will stem the rising tide of capital flight from the State on account of the absence of an active and indigenous informal economic sub-sector.

The possible area that SRIP can support tourism development include: • Sponsor studies on how Cross Riverians can be integrated better into the emerging opportunities in the tourism sector. • Contract a consultant to study how communities in tourist sites can improve their attitude towards tourists.

5.3.4 Ministry of Agriculture

Agriculture is a key economic sector. Its major goals include:

• To ensure food sufficiency and eradicate poverty. • Employment generation and the spread of prosperity. • Provide raw materials for the industrial sector. • Provide produce for exports.

Government has continued to encourage the development of our cash and tree crops namely, Oil Palm, Cocoa, Cashew, Pineapple, Cassava, Rice, etc. The State Government raised and distributed 2.5 million cocoa seedlings and 850,000 oil palm seedlings for the expansion of existing farms and the establishment of new ones.

Arrangements have been concluded with Olam Industries to buy cashew nuts from farmers as well as install a cracking unit. Pineapple loans have been disbursed to 312 farmers to plant 315 hectares at Uyanga, Etung and Akpabuyo. Farmers are expected to receive income of N300 million from produce sales.

The N1 billion credit scheme for cassava and rice cultivation was launched and disbursement of the first tranche of the loans has began.

SRIP can support agriculture in a number of ways: • Build capacity for budget work and planning the budget and PRS departments of the ministry. • Ensure that the Ministry is linked to the state website, and Internet and Intranet connectivity. • Sponsor research on how to enhance the capacity of local farmers to adopt new technologies. • Sponsor an impact assessment of current policy measures on the living conditions of local farmers.

66 5.3.5 Management Development Institute

The Management Development Institute (MDI) is a government institution involved in training public servants. It has indicated its capacity to train and retrain personnel involved in budget and auditing process. SRIP can assist MDI to achieve the following:

• SRIP can commission MDI to undertake training needs analyses for public finance and budget institutions. This may necessitate the recruitment of a consultant to assist the MDI to prepare the training needs and subsequently to mount relevant courses for public finance personnel and institutions. • SRIP can support the library of MDI with books and reference material, and computers.

67 CHAPTER SIX

SRIP/CRS PARTNERSHIP: COMMITMENTS, RISKS, CONSTRAINTS, AND EXPECTATIONS

6.1 SRIP’s Commitment to its Partners Depending on the outcome of further needs assessment, SRIP can support its partners, on a grant basis, with the following: • Provide office furniture with the understanding that partners would maintain them on a continuing basis. • Provide training for the Legislature at the state and LGA levels, CSOs, CBOs, and other partners on budget monitoring and tracking of public spending. • Provide IEC materials for partners. • Launch a website for the state. • Assist in the training of core specialists in accounting, budgeting, auditing, and project evaluation. • Assist in the dissemination of budget information by translating a simplified version of annual state budget into the major local languages of the state. • Build capacity of CSOs and CBOs for budget monitoring and independent budget work. • Assist in providing a consultative office for Budget and public finance CSO networks in the state. • Assist in provision of Internet and Intranet connectivity to the relevant partners where not considered by current state computerization betworking. • Build budget-tracking mechanisms for use by the SHA and CSOs in the state. • Build capacity for the reporting of budget and public finance matters by the Press. • Support the state SERVICOM office, and assist to set it up in all the focal LGAs. • Assist the Budget office to set up Due Process units in the focal LGAs. • Provide personal computers and the relevant software for the respective partners.

6.2 Risks of SRIP Partnership

The possible risks of SRIP partnership include the following: • There is a risk that the government of Cross River State will not authorize the regular release of information on actual income and expenditure for the proposed budget tracking mechanism. • There is the risk that the SHA will not amend the local government supervisory laws to give local governments more autonomy and independence in the management of their funds. • There a risk that government will not allocate sufficient funds for the restructuring of the SPC. • There is the risk that funds allocated for planning, research and statistics, and training will be diverted for other ‘pressing’ administrative needs. • There is the risk that a new government will abandon critical components of the reform programme. • There is the risk that facilities, equipment, and office furniture SRIP wants to provide will not be maintained by the beneficiaries. 68 6.3 Constraints of SRIP

The major constraint SRIP faces in the state include: • Lack of a comprehensive database or socio-economic map of the state. SRIP would have to rely on estimates, oral testimonies, and sometime conjectured estimates. • Attitude to work and life: SRIP may not have capacity to change or improve the people’s attitude to work and life. It is assumed however the relevant social re- orientation agencies will do their work successfully in this regard. • SRIP is constraint by its limited budget and EC’s mandate on strict compliance to its provisions. • Bad roads limit the accessibility of SRIP operatives to monitor activities in some of the remote communities in focal LGAs.

6.4 Expectations of SRIP

SRIP expects that the government and people of Cross River State are commitment to the NEEDS/CR-SEEDS/LEEDS reform agenda, and that the reform process will remain on course until the goals of accountability and transparency in the management of public funds are achieved.

More specifically SRIP expects that: • The SPC would be well funded, professionalized, and reformed to ensure that it has capacity to handle its planning, research, information systems, and donor coordination functions effectively and efficiently. These core economic management functions need to be strengthen and supported because success of CR-SEEDS/LEEDS depend squarely on them. • The commitment to planning, research, and development would extend to the PRS departments in all line ministries and focal LGAs. Modern development is dependent wholly on capacities and skill infrastructures. The PRS departments should have capacity to feed the SPC and Budget Office with specialized information for programming and budgeting. • The Budget Office would develop mechanism for budget monitoring and reevaluation of budget provisions. • The SHA would support the reforms by ensuring that budgets are implemented as passed, and that cases of misuse or abuse of funds are treated expeditiously. • The SHA would ensure that local government has a good measure of autonomy in the use of their resources for improvement in the living conditions of people at the grassroots. Local governments should be reimbursed for expenditures they make on behalf of state and federal government. • The Head of Service would strengthen SERVICOM and extend its services to the local government areas. • The Head of Service would build and implement training programmes that meet the training needs of the Service. • The SPC and Ministry of Women Development would prepare separate programmes for gender and CSO mainstreaming for consideration by the State

69 Executive Council and subsequent presentation as Bill for consideration and passage by the SHA. • The office accommodation difficulties and vehicular difficulties currently faced by the State Auditor-General and Auditor General of Local Governments would be solved as soon as possible. • The CR-SEEDS and LEEDS documents would be reviewed based on programmes prepared for the major development goals and key activity sectors. • A statewide comprehensive Household Enumeration would be carried out with donor support.

70 CHAPTER SEVEN

SUMMARY OF MAJOR FINDINGS, RECOMMENDATIONS AND CONCLUSION

7.1 Summary of Major Findings

The major findings of this assignment are summarized below as follows: • The capacity for budgeting, planning and research in the state and local government are grossly inadequate. Much more needs to be done to implant the culture of budgeting and development planning in the psychics of policy makers and politicians. • CSOs are yet to be fully integrated into the budget processes in the state. • Budget related CSOs lack capacity to create and sustain network for budget transparency and accountability in the state. • The role and conscious programmes for incorporation of CSOs into the budget and planning processes in the state are completely missing in the CR-SEEDS and LEEDS documents. • CR-SEEDS and LEEDS documents are working documents and proposals in their present forms. More research and programming works are needed to produce from them operational strategies that the state government and local governments can implement. • Lack of reliable statewide database inhibits planning and budgeting, and limits the proper estimation of interventions required in different areas and donor programmes in the state.

7.2 Recommendations for Revising Existing Development Models

• Empower the planning machinery in the state with the required capacity to conduct basic research that would serve as basis for selected policy choices. • Strengthen the control machinery in the state Accountant-General and Auditor- General, Auditor –General of Local Government, Due Process Unit, and the Inspectorate Unit in the Ministry of Local Government Affairs with equipments, training and information. • Strengthen capacity of the planning research and statistics departments in all line ministries to aid the SPC in its planning and programming endeavours. • Planned decentralization of the fiscal operation of government to delegate the authority to implement budgets by the accounting officers of line ministries and departments. This will enhance the seriousness with which budget matters are treated. • Mainstream CSOs in all aspects of public finance management and monitoring. • Create structures and programmes for organizing budget related CSOs into networks and communities for effective coordination of independent budget work.

71 7.3 Conclusion

Cross River State has the potentials for self-sustaining development. With its stock of human and material resources and the visionary administration of Governor Donald Duke the state has achieved tremendously in the drive to eradicate poverty and create jobs, and improve living conditions of the electorate. The huge investment in infrastructure like roads, electricity, water supply, and sanitation, and Tinapa project are already yielding some desirable outcomes.

Indications that the state would become Africa’s foremost tourists’ delight and business resort are glaring. But self-sustaining development is more about institutions than individuals. Continuity in the development process requires enduring budget and planning systems to ensure that the growth momentum is not truncated.

At present institutions are weak, the brilliant performance notwithstanding. There is urgent need to build capacity in budget preparation, implementation and monitoring in all line ministries. Accounting and auditing institutions need to be strengthened with the relevant skills and technological knowledge for budgetary control. It is needful also that CSOs are empowered with capacities and opportunities to engage constructively in all spheres of the budget processes in the State.

Fortunately SRIP aims at improving public service delivery, transparent budgeting, and the productive utilization of public finances. The expected outcomes are good governance, democratization of the budget process, and poverty reduction. SRIP has offered the people and government a window of opportunity to sustain her enviable development drive and put the state on the path of self-sustaining development. This is an offer the state cannot reject, and the time to act is now.

72 APPENDIX I LIST ACRONYMS CSO - Civil Society Organization CHDC - Human Developments and Civil Society (CHDCS) CRS-DM - Cross River State Development Model CRUTECH - Cross River State University of Science and technology CR-SEEDS - Cross River State Economic and Development Strategy DFID - Department for International Development DPMD - Development Policy Management Division EC - European Commission ECA - Economic Commission for Africa ECOWAS - Economic Community of West African States EFCC - Economic and Financial Crime Commission ERDF - ECOWAS Regional Development Fund EU - European Union FAC - Federation Account Committee GDP - Gross Domestic Product ICPC - Independent Corrupt Practices Commission IEC - Information, Education and Communication. IGR - Internally Generated Service IRS - Internal Revenue Service IT - Information Technology LEEDS - Local Government Economic Empowerment and Development Strategy. MDGs - Millennium Development Goals MIS - Management Information Systems MLGA - Ministry of Local Government Affairs MOU - Memorandum of Understanding MTEF - Medium Term Expenditure Framework NAFDAC - National Agency for Food and Drug Administration and Control NEEDS - National Economic Empowerment and Development Strategy NGO - Non-Governmental Organization PAC - Public Accounts Committee PPP - Private Public Partnership PRS - Planning, Research and Development. RRM - Repair, Rehabilitate, and Maintain RUWATSSA - Rural Water Supply and Sanitation Agency SHA - State House of Assembly SON - Standard organization of Nigeria SPC - State Planning Commission. SRIP - Support to Reforming Institutions Programme USAID - United States Agency for International Development SSS - Senior Secondary School UBE - Universal Basic Education UNDP - United Nations Development programme WAEC - West African Examination Council WASH-COM -Community Water Sanitation and Hygiene Committee WSSSRP -Water Supply and Sanitation Sector Reform Programme

73 APPENDIX II

LIST OF PERSONS INTERVIEWED Name Designation/Organisation Ministries, Departments and Agencies Charles Achu Secretary to SPC Mr. J. Oga Chief Budget Officer, Budget Office Mr. Ikang Gabriel Head Cash Office, Office of the Accountant- General Mr. A. E. Ogon Office of the Accountant General Mr. Eke U. Eke Office of the Accountant General Mrs. Rosemary M. Ekpo Permanent Secretary, Ministry of Environment Mr. Ilem Assistant Director Quality Control, Min. Of Environment Stephen Ufre Deputy Director, Env. Impact Assessment, Min. of Environment Dr. Chris Agbo Permanent Secretary, Forestry Commission, Calabar Dr. Phillip Ita Director of Forestry, Forestry Commission, Calabar Mrs. B. A. Ushie Permanent Secretary Ministry of Local Government Affairs Chief (Dr.) James Ene Boco Permanent Secretary, RUWATSSA JP (KSJ) Engr. Ekpenyong Ibah Head Sanitation RUWATSSA A. Agba Head Project Management Evaluation RUWATSSA Pat. E. Emori Head Water Resources, RUWATSSA Rev. Brown E. Ubom Director of Admin. Min. of Education Joseph U. Ugbong Assistant Director, Inspectorate, Min. of Education Mrs. M. J. Ikwen Permanent Secretary Min. of Education Engr. Ogar Dir. Of Industries, Min of Trade and Investment Mr. Akpagu Asst. Dir. Of Industries., Min. of Trade and Industries Rev (Dr.) Anko Permanent Secretary, Min. of Finance Mr. Mike Ngbekem State UNDP Programme Office Solomon Eta Head Research& Statistics, SPC Calabar Bar. Joe Efa Head Due Process Mr. Oqua Bassey Office of the State Auditor General Anthony M. Ayire Auditor General of Local Government Chris Etim Nyong State Auditor General Dr. Sam Ekpe Permanent Secretary Min. of Agriculture Mrs. Eni Christy Armon Director PRS Min. of Agriculture Dr. Phillip Obaji Permanent Secretary, Min. of Health Cletus A. Agorye JP Dir. of Planning, Min. of Health Dr. Paul Tourism Bureau Jack Janardhan Project Director Transnational Computer Technology Mr. Ekom Tinapa Project Office

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Name Designation/Organisation Local Governments Hon. James Achu Leader Boki Legislative Council Pastor Joe Ekpaba LGA WASH Coordinator, Yakurr Eneng Ugbie Planning Officer Boki LGA Vincent Eteng Director of Finance, Boki LGA Godwin Anake Director of Works, Boki LGA Richmond O. Ansa Treasurer, Yakurr LGA Prince Pius Bassey Secretary Odukpani Secretary of Council Odukpani LGA Julius Osang Community Development Officer Water, Sanitation, and Hygiene, Boki LGA Lady Assem Edim Treasurer Odukpani LGA Mr. Bassey Eyo Supervisor for Finance, Odukpani LGA Joe Ebesie Coordinating Director (CD), Odukpani LGA Ubi Reham Accountant Odukpani LGA Cross River State House of Assembly Honourable Eta Mbora Chairman, Public Accounts Committee, SHA Aka Bisong Adie Secretary, Finance & Appropriation Committee SHA Afoyo John Odey Budget Analyst, SHA Civil Society Organisations Excellence Eyo Offiong Uso Young People Initiative (YPI) Abasiama Edeghe Centre for Training & Development Activities5b Archibong Eso Lane Calabar Theodore Ebuta YPI, Calabar Adama David I. JDPC 5 Esighi Str. Calabar Effiom Duke ABGREM NIGERIA, 23 Etinyin Abasi Str Prince E. Idiong CRAI Citizens Right Awareness Initiative, 23 Bedwel Str., Calabar Members of CSO Budget Transparency and Accountability Network in Calabar Other EU-Projects Dawda Jawara State Coordinator, WSSSRP Michael Chukwura Water and Sanitation Engineer, WSSRP, CRS Mrs. Rose O. Nyambi CRS Programme Manager, EU- PRIME Oba James MIS Officer/Office Manager MPP6

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Annex I

Broad Development Objective. Self-Sustaining Development of Cross River State

Strategy CR-SEEDS

Specific Goals

Poverty Growing the Employment Infrastructure Ethical Reduction Private Sector Generation Development Re-orientation

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Annex II

Poverty Reduction

Specific Steps

Rehabilitation, Repair and Mainstreaming Gender Provision of basic health Rehabilitation and Support for Maintenance of Facilities issues, and HIV/AIDS in care facilities and equipping of Intervention and amenities that affect the policy framework of vaccination at the Primary and Programmes and living conditions of the the state. community and local Secondary schools, NGO initiatives poor. government levels.

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Annex III

Growing the Private Sector

Specific Steps

Privatization of Establishment of Establishment and Provision of Harmonization of Development of Eco- government Small-holders sale of agro-allied micro-finance for Taxes and Levies in Tourism, and Tinapa Enterprises Farmers’ scheme industries. small and medium the state, creating a project-associated enterprises. favourable business activities would boost environment via Tax the business of small Harmonization and and medium provision of enterprises. infrastructure for transportation and marketing, electricity supply.

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Annex IV

Employment Generation

Major Steps

Recruitment of Monitoring of Privatization Employment Promotion of Credit facilities Employment indigenes with national and of ailing opportunities for small holders’ for SMIS opportunities core competence international public direct labour and scheme in enhance their created by the in Engineering, job-openings to enterprises to artisans created agriculture can business and can emerging Medicine, ensure that ensure that by the on-going engage some create tourism industry Information Cross Riverians they operate work in the Cross Riverians employment. and the newly Technology and are well productively Tinapa site. as farm heads. established agro- teachers in public informed to take and employ allied industries service. advantage of Cross them. Riverians.

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Annex V

Infrastructure Development

Specific Steps

Environment water Supply Roads Education Health & Electricity • Constant maintenance • Construction of • Construction and Refurbishing of Expansion of urban of existing urban erosion refurbishing of classrooms facilities in health and rural water roads. management and in primary and secondary institutions in the projects in the state. • Dualization of major control channels in schools. state. roads. locations of need. • Building and refurbishing • Construction and • Provision of waste of structures in the Cross beautification of bins and River State University of road junctions in evacuation Science and Technology urban centers. vehicles for timely (CRUTECH) • Provision and clearance of solid maintenance of waste. streetlights in urban centers. • Daily sweeping and

cleaning of major roads in urban centers. • Planting of trees and grasses to check erosion and beautify 80 the town.

Annex VI

Ethical Re-Orientation

Specific Steps

• Equipping & • Introduction of distinct • Hosting of enlightenment Extension of service & flag and State Anthem for campaigns and coverage of CRBC Cross River State to create sensitization television service, to collective conscience seminar/workshops to enhance people access among Cross Riverians. enlighten Cross River to information. Cross River State is the people and CSOs on the first state in Nigeria with a programmes of • Airing of programmes distinct Flag and National government, and the need and jingles that are anthem. change the thinking mould designed to transform of people in the state. the mindset of Cross Riverians and enhance their productivity.

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Annex VII

Sectoral Analysis of the CROSS RIVER STATE DEVELOPMENT MODEL

Self-Sustaining Development of Cross River State

Activities of Key Sectors.

•Tourism Influx of Tourists to Agriculture Forestry Industry generate revenue • Extend support to Sustainable • Privatization of directly and indirectly small holders to management and the public by its role in expand production conservation of enterprises in promoting trade, and of agriculture forest reserves the state. information exchange. produce and in the state. • Establishment of • Tinapa project when livestock. industries that completed would • Ensure food and are later sold to create jobs, generate nutrition security in interested growth and promote the state. private the tourism sector. • Promote the operators. • Earnings from production and sale • Establishment of Tourism is expected to of diary products. industrial parks reduce dependence on • Provide raw across the state. statutory allocation materials for support from federal account. of agro-allied industries. 82