Government · Lesson 14

Federalism in Nigeria: states, revenue & federal character

JAMBWAECNECO

What the syllabus asks

JAMB: Nigerian federalism: rationale, features, tiers of government and their relationship; creation of states (1963, 1967, 1976, 1987, 1991, 1996); revenue allocation; federal character; problems and prospects

WAEC: Federalism in Nigeria: reasons for adoption, features, merits and demerits; problems of Nigerian federalism; creation of states; revenue allocation; federal character

NECO: Federalism in Nigeria: reasons for adoption, features, merits and demerits; problems of Nigerian federalism; creation of states; revenue allocation; federal character

What you will learn

Define federalism and identify its features in Nigeria.
Explain the reasons Nigeria adopted federalism and how it evolved from 1954.
Describe the division of powers under the 1999 Constitution and relations among the tiers.
Trace state creation from 1963 to 1996 and evaluate its merits and demerits.
Explain revenue allocation: principles, commissions and current formula.
Explain federal character and the problems and prospects of Nigerian federalism.

Key points

Federalism: constitutional division of powers between central and state governments, each independent in its sphere.
Features: division of powers, written and rigid constitution, supremacy of the constitution, independent judiciary, bicameral legislature.
Reasons: size, diversity, fear of domination, colonial regionalism, uneven development, leaders’ wishes; Lyttelton 1954.
1999 Constitution: Exclusive List (now 66 after 2023), Concurrent List, residual to states; federal law prevails (s.4(5)).
States: 1963 Mid-West; 1967 12; 1976 19 + FCT; 1987 21; 1991 30; 1996 36.
Revenue: derivation, need, equality, population etc.; commissions Phillipson 1946 to RMAFC 1989.
Current: 13% derivation; federal 52.68%, states 26.72%, LGs 20.60%; VAT 15/50/35.
Federal character: 1979; s.14(3)–(4); Federal Character Commission 1996.
Problems: over-centralisation, revenue disputes, oil dependence, state demands, census, indigeneship; restructuring debate.

Start here: Meaning and features of federalism

Nigeria has one President but 36 governors; one National Assembly but 36 State Houses of Assembly. A Lagos law on tenancy does not apply in Kano. This arrangement is federalism.

Federalism is a system of government in which the powers of government are divided by a constitution between a central (federal) government and the governments of component units (states or regions), so that each is independent within its own sphere and neither can abolish the other.

Features of a federal system

Division of powers between levels, set out in the constitution.
Written constitution that defines the division.
Rigid constitution: changes need the consent of both levels (in Nigeria, two-thirds of each House of the National Assembly and two-thirds of the State Houses of Assembly, s.9).
Supremacy of the constitution over all governments (s.1).
Independent judiciary, especially a supreme or constitutional court, to settle disputes between levels (the Supreme Court has original jurisdiction in disputes between the Federation and a state, or between states, s.232).
Bicameral central legislature in which units are equally represented (Nigeria’s Senate: three senators per state and one for the FCT).
Separate governments at each level with their own executives, legislatures and revenue.
Fiscal arrangements for sharing revenue.

Worked example 14.1

Explain why a federal constitution must be rigid.

The division of powers is the foundation of the federation.
If the central government could change it alone, it could take away state powers and turn the federation into a unitary state.
So amendments need the consent of both levels.

To protect the division of powers

Try it yourself. Which court settles disputes between the Federation and a state?

Show solution

The Supreme Court (original jurisdiction, s.232).

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Practice questions

1. Federalism is a system in which

powers are constitutionally divided between central and regional governments
the centre holds all power
states can leave at will
there is one legislature only

Show answer

A: powers are constitutionally divided between central and regional governments
Each level is independent in its sphere.

2. Which is a feature of federalism?

A flexible constitution
No courts
A single level of government
A written and rigid constitution

Show answer

D: A written and rigid constitution
Also supremacy of the constitution.

3. Matters on which only the federal government can legislate are in the

residual list
Fourth Schedule
Exclusive Legislative List
Concurrent Legislative List

Show answer

C: Exclusive Legislative List
E.g. defence, currency, foreign affairs.

4. Matters left to the states alone are

federal matters
residual matters
exclusive matters
concurrent matters

Show answer

B: residual matters
Not listed on either list.

5. When a state law conflicts with a valid federal law on a concurrent matter,

the federal law prevails
the state law prevails
both are void
the Senate decides

Show answer

A: the federal law prevails
Section 4(5).

Key words

Federalism: A system in which powers are constitutionally divided between a central government and regional or state governments, each independent in its own sphere.
Federating units: The component governments of a federation; in Nigeria, the states.
Exclusive Legislative List: Matters on which only the National Assembly can legislate.
Concurrent Legislative List: Matters on which both the National Assembly and the State Houses of Assembly can legislate; federal law prevails if they conflict.
Residual powers: Matters on neither list; left to the states.
Revenue allocation: The sharing of federally collected revenue among the tiers of government and among the states.
Vertical allocation: Sharing among the federal, state and local governments.
Horizontal allocation: Sharing among the states (or among local governments) themselves.
Derivation: Returning a share of revenue to the area from which it was derived (e.g. oil-producing states).
Federal character: Fair reflection of the diversity of Nigeria in appointments and distribution of resources.
Fiscal federalism: The division of taxing powers and spending responsibilities among levels of government.
Secession: A part of a state breaking away to form a separate state.

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