Despite receiving N9.53 trillion from federation account from 2000-2018, the oil-producing South South region of the country comprising six states is still bedevilled with underdevelopment.
This was revealed by the Nigerian Extractive Industries Transparency Initiative (NEITI) on Tuesday at a book launch in Abuja.
NEITI, in a book titled ‘Perception of the Impact of 13% Oil Derivation Allocation’ launched in Abuja, lamented that these huge allocations and various other interventions in the Niger Delta have failed to reverse the conditions of poverty and underdevelopment suffered by the region.
The South-South states are Edo, Delta, Bayelsa, Rivers, Cross River and Akwa-Ibom.
In a section of the book titled ‘Oil Revenue Management and Benefits Capture in Nigeria’s Niger Delta’, authored by staff of NEITI — Dauda Garuba, Dieter Bassi & Adaure Njoku – the transparency agency stated that the amount allocated to the six south-south states was three times the allocation to the states in the south-east region.
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“A breakdown of the figures reveals that N9.53 trillion was allocated to the six states of the South-South geopolitical region between 2000 and 2018. This is almost double of the allocation (N4.73 trillion) to the second highest geopolitical zone, North-West, and over three times the allocation to South-East geopolitical region,” NEITI said.
“The 13% oil derivation allocation to the South-South states is the major reason for the observed huge revenue disparity. Even though Abia and Imo States in the South-East region and Ondo State in the South-West region also draw from the 13% derivation funds, their shares are way insignificant – both in terms of their contribution to quantum of oil produced and the number of states that produce oil in their regions – to warrant any significant difference in the observed figures posted by these regions, let alone the figures of other non-oil producing regions,” it said.
NEITI explained that this reality, added to the deepening social and environmental consequences of extraction, had turned the Niger Delta into an epicentre of unmatched contradictions.
On the one hand, according to NEITI, the region is home to highest subnational revenue earners from the Federation Accounts, while on the other hand, it shows very limited impacts in terms of the real value realised from the huge revenue allocation and disbursement to its component states.
It added that the top four subnational oil producers and revenue earners, namely, Akwa Ibom, Bayelsa, Delta and Rivers states, received N1.60 trillion, N1.20 trillion, N1.38 trillion and N1.54 trillion, respectively from 2001 to 2018, noting that despite earning so much, the four states are also among the highest indebted states in Nigeria.
It added that: “Worse still is that despite being the epicentre of several development policy initiatives tailored to respond to the ecological needs and the negative consequences of oil extraction, the development outcomes from those initiatives have met only minimal expectations.
“Despite federal government-led initiatives, such as the Niger Delta Development Board, the Niger Delta Basin Development Authority, the Presidential Committee on 1.5% Derivation Fund, the Oil Mineral Producing Areas Development Commission, the Niger Delta Development Commission and the Ministry of Niger Delta) to subnational governments’ use of the 13% oil revenue derivation funds, the interventions in the Niger Delta are yet to reverse or significantly improve the conditions of poverty and underdevelopment of citizens of the region.
“Put differently, the higher revenue disbursement to Niger Delta states from the Federation Accounts Allocation Committee (FAAC) on account of 13% oil derivation have raised citizens’ expectations without a corresponding delivery of performance.”
