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Monday, 25 November 2013

Sovereign or unitary wealth fund?


Sovereign or unitary wealth fund?
Not long ago, while collecting Federal Government’s bond on the Lagos State contribution to the unconstitutional Sovereign Wealth Fund, Lagos State Governor, Raji Fashola, restated his government’s opposition to the Fund.
More noticeably, while emphasising  his objection, Governor Fashola likened the Aso Rock- imposed Sovereign Wealth Fund to the sharing of a family estate in which a top member of the family is dictating to, or indeed, forcing others in the family to save for a rainy day.
That was interesting because that was exactly the same analogy with which state governors were alerted in this column as far back as November 11, 2011 when members of National Assembly (especially of the defunct ACN, CPC and ANPP) ignorantly joined in passing the Sovereign Wealth Fund Bill, while attorneys-general of the thirty six states kept slumbering without realising the implications for our federal set up.
Accordingly, the views expressed in this column in the early days of the Sovereign Wealth Fund illegality, are being reproduced today. It must, of course, be added that when it dawned on state governors that they were being shortchanged, they headed for the Supreme Court as advised in this column at that time.
Instead of deciding the case in view of its constitutional importance/urgency, the Supreme Court, ever complicit with the Executive, has been dilly-dallying. First, the court advised state governments to try out of court settlement with the Federal Government. When the effort failed after about four months, the same Supreme Court fixed hearing for early next year.
Meanwhile, did Governor Fashola and any other state governor(s), who might have collected the Federal Government bond on their contributions to the Sovereign Wealth Fund realise the implication of their action? It was a trap set for them by the Federal Government. In law, once you abide by the contents or fall-out of an action whose legality you are challenging in a court of law, you have ignorantly recognised the legality  of the subject matter and, therefore, forfeit all rights of litigation. Case dismissed.
The governors concerned should wait for the hearing of their suit. The following is the alert given the governors and it was even insinuated in the alert that Nigeria was bankrupt. Those state governors owe me the same fee to be paid to their legal consultants: 
Even if one political party controls the entire thirty-six component states of Nigeria, governance in the country will still be under the prevailing federal constitution until or unless the document is amended otherwise to empower the Federal Government as a free-wheeling overlord to which the states are subordinated especially on fiscal matters.
What is more, for now state governments in the country are controlled by six political parties, the ACN, the CPC, the PDP, ANPP, APGA, and the Labour Party (LP). This fact alone does not, on that basis necessarily confer autonomy on the states. Rather, their somewhat respective self-government derives authority from the federal constitution. In effect, the PDP-controlled Federal Government, in a stable political environment cannot dictate to PDP-controlled state government(s) how to disburse their revenue from the federation account.
This is the basis of the split between President Goodluck Jonathan and the thirty-six state governors. Their disagreement is over the utilisation of surplus federal revenue specifically from oil sales. Goodluck Jonathan in his Almighty, as President of the Federal Republic of Nigeria, has commandeered substantial revenue allocation, which should accrue to the states and converted it into a Sovereign Wealth Fund. Jonathan deems to have acted on behalf of the thirty-six states to save for a rainy day, perhaps on the strength of an act of the National Assembly.
But then such act may not necessarily be in line with Nigeria’s federal structure, since each state has the constitutional prerogative to disburse its revenue from federal allocation instead of some sermon from Aso Rock to save for a rainy day.
It is a question of separation of powers/authority between the federal and state governments rather than some kind of morality. Put in plain language, the head of a family may be privileged to regularly share out from family estate. Yet, each beneficiary is not forced to save for a rainy day (from his share) by the head of the family. Everybody unto himself. If, however, there is a compelling need to save for the rainy day, that will be from mutual voluntary agreement, which at government level, will require an amendment to Nigerian constitution to clearly empower the Federal Government as sole custodian of a Sovereign Wealth Fund, thereby subordinating the states to Goodluck Jonathan.
Such a development is not feasible because it will be against the spirit of the existing constitution which deliberately concedes autonomy to states but also the current political mood for further decentralisation of revenue allocation formula to release more funds to the states. The instant catchy name is fiscal federalism.
There is a major aspect of governance of which those leading us are either ignorant or pretend not to know. This is a civilian if undemocratic government. It is, therefore, ridiculous that those who should know better – lawyers, parliamentarians and political party officials – are alluding to the Petroleum Trust Fund as operated under the late General Sani Abacha’s regime.
State military governors in a military regime do not enjoy the same constitutional legitimacy with elected state governors. In fact, the only Constitution in a military regime is the Commander-in-Chief from whom every other official takes orders. State military governors are, therefore on duty postings, operating completely at the sole discretion of their Commander-in-Chief, (in that case, General Sani Abacha), who originated the Petroleum Trust Fund (PTF) headed by General Muhammadu Buhari.
Accordingly, no state military governor had constitutional authority to insist on disbursing (his) state excess oil revenue as he deemed fit.
The law establishing the PTF under General Sani Abacha, and by the way, still sustained under General Abdulsalami Abubakar, legally and constitutionally lapsed on the return of civilian rule in 1999 as it (the PTF Decree) conflicted with the federal constitution which restored the autonomy of elected state governors. In contrast, all military regimes are unitary in operations.
Jonathan’s Sovereign Wealth Fund is similarly being likened to the excess crude fund as operated under Obasanjo. For a start, Obasanjo never said he was saving revenue due to the states for a rainy day. And the fact that Obasanjo operated a similar policy does not make it constitutional. He was only allowed unnecessary latitude largely because of the ethnic affinity of some state governors while others were corrupt and not well-footed to challenge him (Obasanjo) in law courts. What is more when the same Obasanjo unconstitutionally withheld federation account allocation of Lagos State government over disagreement on how the allocation should be disbursed to local councils in Lagos State. Governor Bola Tinubu successfully challenged Obasanjo’s illegal act in court, which ruled that Obasanjo should release the fund.
Both Bola Tinubu and law courts could not enforce the judgement as Obasanjo defied the ruling throughout his tenure. Release of the total arrears of the allocations of Lagos State Government from the federation account was one of the first decisions of the late President Umar Yar’Adua on assumption of office.
In the present case, the Federal Government can operate its Sovereign Wealth Fund just as state governments can each or collectively operate their wealth fund independent of Jonathan’s Sovereign Wealth Fund. It is also up to any state government or some state governments to join the Sovereign Wealth Fund. Where, however, a state or group of state governments resist such local colonialism, it is within the constitutional right of such states.
Where a state government refuses to save for the rainy day or even decide to squander its share of excess crude fund, it is not the business of Federal Government. Where a state government accordingly goes bankrupt or declares itself bankrupt, only then can the Federal Government move in, not by injecting any financial aid from its own Sovereign Wealth Fund, but by declaring an emergency to sack such a state government. The Federal Government will also be acting within its constitutional responsibility to, over a period thereafter, commence deduction of refund of the emergency financial aid to the state from its (state’s) share of federation account.
That is constitutionalism in operation. Only a State House of Assembly can query, control or even legislate a state government to save for a rainy day. Where a state government fails to sign such a fiscal bill or any bill for that matter, such statutorily becomes law after a period.
But then, Obasanjo throughout his tenure ignored the Freedom of Information Bill passed by the National Assembly.
Even where constitutionally imperative for Federal Government, such bill cannot unilaterally be initiated. State governors might therefore be sincere in the impression created that they were taken by surprise. At least, a state governor, Adams Oshiomhole of Edo State, owned up to have been consulted on the sovereign wealth bill by Finance Minister, Ngozi Okonjo-Iweala.
As Edo’s Adams Oshiomhole was consulted, did he seek the legal opinion of his Attorney-General? If not, why did Oshiomhole agree with the coercion into the Sovereign Wealth Fund only to turn round to join other state governors in challenging the legality/constitutionality of the Sovereign Wealth Fund in a court of law?
If Governor Oshiomhole agreed to be forced into the Sovereign Wealth Fund, he was unconsciously surrendering the constitutional prerogative of Edo people to disburse their share of federal allocation (through their governor) the way they deemed fit.
Incidentally, when did the thought of Sovereign Wealth Fund occur to President Goodluck Jonathan? Throughout his campaigns for the presidential elections, he never mentioned anything to that effect. Instead, as late as the eve of the elections, Jonathan stimulated each state governor with three billion naira from the same federation account. What for? To ensure the ninety-eight percent return of votes in their states?
Before assuming office, Finance Minister, Okonjo-Iweala alerted that Nigeria as a country had been living above its means. Okay, she said Nigeria must live within its means. It can only be hoped Nigeria is not yet bankrupt and that the Sovereign Wealth Fund is a desperate way to cover up.
Whichever, state governments should not be forced to join the Fund, very much against their fiscal autonomy.
Governor Lamido in bad light
He could be anybody but Governor Sule Lamido of Jigawa State. This is year 2011 and despite the low level of democracy in Nigeria, the country is not such a place where a public servant, perhaps unconsciously, will elevate himself to the status of Lord of the Manor before whom everybody should be prostrating or be frightened to appear.
As an elected governor, it should not be a crime to criticize Sule Lamido. It is, of course, not sweet if not sour to be criticized but as long as a public office holder remains in the capacity, he must put up with criticisms. Or indeed, false allegations.
There are adequate laws to deal with such provocations. It is also settled in Nigerian law that a serving Nigerian president or state governor has no legal basis to institute any legal action against ordinary citizens as long as he, (the president or state governor) enjoys constitutional immunity against any legal action by an ordinary citizen.
That, in the first place, provides cover for any Nigerian citizen (especially of Jigawa State origin) to be intimidated by Governor Sule Lamido. Where, on the other hand, Governor Lamido wants to try his luck, he should follow due legal process without unnecessary interference.
Libel? Defamation? Yes, Governor Lamido might have been a victim. The place to seek redress, under Nigerian constitution, is not the Sharia court(s) but established conventional law courts. Libel or defamation is not a religious crime for which Sharia courts are established specifically to handle. Did Governor Lamido complain to police authorities about his political opponent libeling or defaming him? If he did, police authorities should have told Lamido that Nigerian constitution does not allow him the luxury of suing since he (the governor cannot be sued.
If at any rate, the police, out of ignorance, mischief or subservience, were to panic before Governor Lamido, then the alleged culprit should have been arraigned at a court of competent jurisdiction instead of a lower court or a Sharia court only to obtain a convenient excuse that such court(s) lack jurisdiction, an excuse for remanding the alleged accused in prison or police custody pending arraignment at court of competent jurisdiction. It would even be worse if Governor Lamido did not complain and only an overzealous police officer had been in action. Whichever is the case, the buck stops on Sule Lamido’s table for all legal/constitutional controversies in his state and around his person.
It is all the more worrying because of Sule Lamido’s person and his background. The victim in the current violation of human rights is not only a member of rival Action Congress of Nigeria (ACN). Second, Sule Lamido was one of those self-styled progressives who rose to fame through regular and harsh criticisms of government, especially military regimes.
In one of such misadventures under the late General Sani Abacha’s regime, Sule Lamido and his friend, the late Abubakar Rimi, were detained for months. If under a military regime, Sule Lamido believed he must assert his right to criticize General Abacha and his government, why, especially in a civilian dispensation, must the ordinary Nigerian citizen of Jigwa State origin not have the right to criticize Governor Lamido without being charged to court as a cover for detention in prison custody?
Sule Lamido did not enjoy it when he was detained by General Abacha. In fact, I took their case (Lamido and Rimi) in this column then in the defunct National Concord. Not long after, General Abacha released them.
That was a military regime, in contrast with the current civilian regime, which is more vulnerable to public criticisms.
Which law in Nigerian says a state governor cannot be criticized or even abused? The redress is at the law courts. And then,why Sharia court? When did Governor Lamido become Sheikh Sule Lamido to be seeking redress in a Sharia court?
On all grounds, the detention of Governor Sule Lamido’s critical political opponent is wrong. Lamido must therefore order his release today.


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