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Resource Allocation and the Problem of Utilization in Nigeria: an Analysis of Resource Utilization in Cross River State, 1999-2007

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Resource Allocation and the Problem of Utilization in Nigeria: an Analysis of Resource Utilization in Cross River State, 1999-2007 Resource Allocation and the Problem of Utilization in Nigeria: An Analysis of Resource Utilization in Cross River State, 1999-2007 By ATELHE, GEORGE ATELHE Ph. D/SOC-SCI/02799/2006-2007 A DISSERTATION SUBMITTED TO THE SCHOOL OF POST- GRADUATE STUDIES, AHMADU BELLO UNIVERSITY IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD OF THE DEGREE OF DOCTOR OF PHILOSOPHY IN POLITICAL SCIENCE. JANUARY, 2013 1 DEDICATION This research is dedicated to the Almighty God for His faithfulness and mercy. And to all my teachers who have made me what I am. 2 DELARATION I, Atelhe George Atelhe hereby declare, that this Dissertation has been prepared and written by me and it is the product of my own research. It has not been accepted for any degree elsewhere. All quotations have been indicated by quotation marks or by indentation and acknowledged by means of bibliography. __________________ ____________ Atelhe, George Atelhe Signature/Date 3 CERTIFICATION This Dissertation titled ‘Resource Allocation and the Problem of Utilization in Nigeria: An Analysis of Resource Utilization in Cross River State, 1999-2007’ meets the regulation governing the award of the degree of Doctor of Philosophy (Political Science) of Ahmadu Bello University, and is approved for its contribution to knowledge and literary presentation. ____________________________ ________________ Dr. Kayode Omojuwa Date Chairman, Supervisory Committee ____________________________ ________________ Dr. Umar Mohammed Kao’je Date Member, Supervisory Committee ___________________________ ________________ Prof. R. Ayo Dunmoye Date Member, Supervisory Committee ___________________________ ________________ Dr. Hudu Abdullahi Ayuba Date Head of Department ___________________________ ________________ Dean, School of Post-Graduate Studies Date 4 ACKNOWLEDGEMENT Words are indeed inadequate to express my gratitude and appreciation to my supervisors, Dr Kayode Omojuwa, Dr Umar Kao’je, and Prof R.A. Dunmoye for meticulously and patiently reading the work and giving me invaluable guidance. May the Almighty God reward you and meet you at point of your needs, Amen. I wish to thank Prof P.P. Izah and Prof EA Unobe for their fatherly guidance and direction. They contributed greatly by reshaping the focus of the research with needed materials. I remain grateful to both of you sirs. .It will be unfair not to mention Prof Mike Kwanashie and Rev .Fr (Dr) Joseph Mamman for assisting me gain admission into the undergraduate program of the University. I am grateful to the Head of Department, Dr Ayuba .A. Hudu for all his support especially the leave of absence to enable me concentrate on my research. I will always remain grateful sir. I equally appreciate members of staff in Political Science Department particularly the useful contributions of Dr A.S Mohammed, Dr YA Yakubu, Dr Aliyu Yahaya, Dr Sulieman Sunday and others whose names may not be mention here. I appreciate the staff of Cross River State Library Board for making materials available to me particularly Mr. Sam Arikpo. Thanks to all my friends. I am thankful to members of my family especially my beautiful wife, Mrs Joy Atelhe, for her love and understanding. Above all, I am thankful to the Almighty God for giving me the strength and wisdom to undertake the research. 5 ABSTRACT This research examines the problem of Resource Allocation and Utilization within the ambit of fiscal federalism in Nigeria from the perspective of Cross River State between 1999 and 2007. The analysis of the political economy of resources allocation and utilization in the State was adopted to underscore the problem and prospects of public resource utilization within the period under study. After consulting relevant literature on the subject matter, there is much evidence to show that researchers have tended to concentrate more on resource allocation within the Nigerian fiscal practice with little or no emphasis on utilization. The study therefore, revealed that the problem of Cross River State does not lie with resource inadequacy alone, but mainly with ineffective and inefficient utilization of resources. In examining the problem, the elite’s theory is used to operationalise the extent to which public resources were utilized in Cross River State during the period under study. By way of explanatory research predicated on systematic interpretation of relevant data obtained from both primary and secondary sources gotten from documentary sources, interviews, and informed personal observation of the researchers, the study found out among other things that: the problem of development and good governance in Cross River State lies squarely with the problem of resource misallocation and mal-utilization by the political elites who control power. The perennial problem of underdevelopment in Cross River State is a direct consequence of resource misallocation and Mal-utilization. To mitigate this indentified problems, the study make a strong case for the propagation of the ideals of fiscal responsibility, transparency, accountability in public resource utilization in Nigeria and particularly in Cross River State. 6 TABLE OF CONTENTS Title page - - - - - - - - - i Dedication - - - - - - - - - ii Declaration - - - - - - - - - iii Certification - - - - - - - - - iv Acknowledgement - - - - - - - - v Abstracts - - - - - - - - - vii CHAPTER ONE: INTRODUCTION 1.1 Background to the study - - - - - - 1 1.2. Statement of the Problem - - - - - - 3 1.3 Objectives of the Study - - - - - - 4 1.4 Significance of the Study - - - - - - 4 1.5 Basic Assumptions - - - - - - - 5 1.6 Scope and Limitation of the Study - - - - - - 6 1.7 Organization of Chapters - - - - - - 6 1.9 Working Definition of Concepts - - - - - - 7 CHAPTER TWO: LITERATURE REVIEW AND THEORETICAL FRAMEWORK 2.1 Literature Review - - - - - - - 9 2.2 Federalism -- - - - - - - - - - - - - - - - - - - - - - - - 10 2.3 Fiscal Federalism ------------------------------------------------------------ 18 2.4 The Debate on Fiscal Federalism - - - - - 28 2.5 Federalism and Public Finance. - - - - - 32 2.5.1 The Development of Nigeria Fiscal System: - - - - - - - - - 37 Some Historical Insights - - - - - - 7 2.5.1a The Phillipson Commission - - - - - 41 2.5.2b Chick Commission 1953 - - - - - - 41 2.5.3c Raisman Commission 1958 - - - - - 41 2.5.4d Binns Commission 1964 - - - - - - 42 2.5.5e The Financial Decree of 1975 - - - - - - 42 2.5.6f The Aboyade Commission 1977 - - - - - 43 2.5.7g The Okigbo Revenue Allocation Commission of 1979 - - 43 2.7 Resource Management/Utilization - - - - 62 2.8 Theoretical Framework - - - - - - 67 CHAPTER THREE: METHODOLOGY 3.1 Location of Study - - - - - - - 73 3.2 Nature and Sources of Data - - - - - - 75 3.3 Sampling Techniques/ Size - - - - - - 77 3.4 Techniques of Data Analysis - - - - - - 78 CHAPTER FOUR: HISTORICAL AND CONTEXTUAL BACKGROUND 4.1 Historical Evolution of Cross River State - - - - 80 4.2 Current Political Structure of Cross River State - - - 81 4.3 Educational Development in Cross River State - - - - 84 4.4 Agriculture in Cross River State - - - - - 85 4.5 Politics in Cross River State - - - - - - 86 4.6 Culture - - - - - - - - 89 4.6.1 Language and Dialect - - - - - - 85 4.6.2 Customs and Traditions - - - - - - 90 4.6.3 Religion - - - - - - - - 91 CHAPTER FIVE: SOURCES OF REVENUE GENERATION IN CROSS RIVER STATE 5.1 Introduction - - - - - - - - 92 5.2.1 Allocation/Revenue from the Federation Account - - - 93 8 5.2.2 Internally generated revenue - - - - - - 95 5.3.1 1999 Federation Allocation to Local Governments Council - - - - - - - 97 5.3 Income for 2001 fiscal year - - - - - - 99 5.4 Income for 2003 fiscal year - - - - - - 104 5.5 Income for 2005 fiscal year - - - - - - 109 5.6 Income for 2007 fiscal year - - - - - - - - - - - - 113 5.7 Overview of annual budgets estimates in Cross ---- - - - - 117 River from 2006 to 2007 - - - - - - 113 CHAPTER SIX: ANALYSIS OF RESOURCE ALLOCATION AND UTILIZATION IN CROSS RIVER STATE. 1999 – 2007 6.1 Introduction - - - - - - - - 119 6.2 Tenders’ Boards - - - - - - - 119 6.3 Due Process - - - - - - - - - - - - - - - 121 6.4 Economic Sector - - - - - - - - - - - - - - - 123 6.5 Finance and Tourism - - - - - - - - - 134 6.6 Forestry - - - - - - - - 146 6.7 Transport - - - - - - - - - - - - - 149 CHAPTER SEVEN: RESOURCE UTILIZATION IN THE SOCIAL SECTOR OF CROSS RIVER STATE 7.1 Introduction - - - - - - - - 159 7.2 Educational Sub sector - - - - - - 159 7.3 The Health Sector - - - - - - - 170 7.4 Environmental and Regional Development - - - 178 7.5 Privatization of Public Enterprises - - - - 187 7.6 Governance in Cross River State - - - - 195 7.7 Summary of findings - - - - - - - - - - - - 197 9 CHAPTER EIGHT: SUMMARY, CONCLUSION AND RECOMMENDATION 8.1 Summary - - - - - - - - 201 8.2 Conclusion - - - - - - - - 203 8.3 Recommendations - - - - - - - 205 Bibliography - - - - - - - - 207 List of People Interviewed - - - - - - 213 10 CHAPTER ONE INTRODUCTION 1.1 Background to the Study Federalism has its essence in two organically related issues. These are power sharing and resource allocation. The former defines the political essence of federalism while the latter underpins its fiscal dimension.Over the years, the fiscal dimension of the federalist practice has been quite problematique in Nigeria. In effect, fiscal relations within the context of the Nigerian federation is said to have been characterized by systematic defects which have given rise to dysfunctions and crises. One significant dimension of the fiscal relations problematics in Nigerian federalism has been
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