The House of Representatives is considering a constitutional amendment bill aimed at increasing the derivation fund from the current “not less than 13 percent” to not less than 50 percent for the development of all States and regions where mineral resources are extracted.
The bill sponsored by Awaji-Inombek Abiante and eight other members of the House came up for second reading on Wednesday but was later deferred to Tuesday, October 29 for continuation of debate to allow members have first hand knowledge of the intent of the bill.
The bill seeks to alter section 162(2) of the 1999 constitution by deleting the words ‘not less than thirteen percent’ and inserting ‘not less than fifty percent’.
While leading the debate on Wednesday, Abiante said: “It is in response to the clamor of the present administration to righting the wrongs of previous regimes and pure federal system, we are lending our voice under this regime of Renewed Hope as hope remains the last pillar which when it collapses, all hope is lost.
“Let us indeed renew the hope not only of our founding fathers but also that of generations after us by the unanimous endorsement to review quickly and to amend the formula to not less than fifty percent (50%) according to the Independence Constitution of 1960 and the Republican Constitution of 1963 in Sections 134 {1 (a &b)} and 140 {1(a & b)
“It is noteworthy to add that including all revenues from VAT in this sharing arrangement will enhance competition among the states for increased productivity by making their environment friendlier for investment in order to increase their revenue. This is in tandem with the spirit of equity and justice”.
He stressed:“There has been discovery of one billion barrel of crude oil and gas in North-Eastern part of the country along the Chad Basin in neighboring Bauchi and Gombe states; there are gold fields in Zamfara, Niger, Osun, Kwara, Ebonyi, Kaduna, Edo and Bauchi states and also the FCT; tin mining in Plateau and Nasarawa state among others.
“The truth is, every state in Nigeria is endowed with mineral resources and this bill seeks to ensure that states and regions where these minerals are extracted from also have their revenues allocated according to the 50% derivation formula”.
The Rivers lawmaker argued that the current formular of revenue sharing renders the collective wisdom of our patriots/statesmen and their intellectual wisdom worthless.
He said further that the current “not less than thirteen percent” derivation entrenched in the 1999 Constitution is grossly inadequate and a mis-representation of the Spirit of pre-independence negotiations and agreements.
He stressed that “even in the intent and desire to ensure the rehabilitation and development of the damaged environment where mineral resources (liquid, gaseous and solid) are derived for the sustenance and development of the whole country does not also seem achievable with the current practice of 13%.
“This Bill is not all about resource control but an attempt to address the myriads of issues bordering on the meager “not less than 13%” derivation fund payable to states on revenues derived from their environment as provided for in Section 162(2) of the 1999 Constitution of the Federal Republic of Nigeria as (amended).
“It is important to state that this amendment is not only relevant for today, but also for the future. Some of us may feel that this section that we seek to amend makes no meaning to them, because, their states are not presently affected. But it is pertinent to ask, what about the future?
“Let us remember that every state in the Federal Republic of Nigeria is blessed with abundant natural resources capable of turning the economic fortunes of the country. The increased interest by Federal Government to reduce the dependence on oil and gas as the mainstay of our economy means attention will be shifted to the solid minerals”.
He said further that the huge environmental impacts of the exploitation of natural resources on the host communities are devastating, including pollution, hunger, insecurity and youth restiveness.
He said “the meager “not less than 13%” derivation as presently provided for by the 1999 Constitution of the Federal Republic of Nigeria encourages Illegal exploitation and mining of our natural resources. It is said he whose parents provides enough food does not bring disgrace to his parents by fighting for food outside. It is a truism that rich parents who do not provide enough food for their children despite having them in abundance can only encourage such children to pilfer from them.
“The illegal refineries that litter the entire Niger Delta region and illegal mining sites across some other parts of Nigeria are reflections of non-commitment of enough funds for the development of these areas.
“The deployment of enough funds means more development in terms of social, economic and security infrastructures. The various State Governments’ ability to build industries will keep the restive youths engaged and away from crimes, especially from the illegal mining and exploitation of natural resources.
“The eradication of illegal mining will mean more money for the Federal and the State governments to share for development purposes, besides the energy and the resources used in chasing and closing illegal operators would be channeled to fast-track the development and protection of the region and indeed any part of the Federation as presently is where mineral resource or any revenue is gotten for the running of the business of Governance, hence the urgent need to increase the derivation fund from “not less than thirteen percent” to “not less than fifty percent”.
“This menace of oil theft has become a threat to our national security and economy, hence the recent tour of the Niger Delta region by the National Security Adviser, Mallam Nuhu Ribadu, Chief of Defence Staff, Minister of Defence, Minister of State for Petroleum Resources, Chief of Air Staff on the 26th of August, 2023 with the strong determination to fight illegal refineries.
“The revenue allocation formula as previously enshrined in both the Independence and Republican constitutions will certainly resolve this issue and make for greater patriotism and a sense of commitment from all. This sense of patriotism will reduce or totally eliminate oil theft and illegal mining as constantly reported.
“It will also make for greater development hinged on healthy competition as witnessed in the pre-independence Nigeria and the First Republic where we had the famous Cocoa House, the University of Ibadan, the University of Nigeria, Nsukka, the University of Ife as it was then called, the famous groundnut pyramid in Kano, the foundation for the eventual establishment of the Ahmadu Bello University, the Western Nigeria Television and several others”.
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