Filed in Politics by on November 27, 2011

Governors’ strange silence on Sovereign Wealth Fund

Minister of Finance, Okonjo Iweala

THE recent declaration by the Finance Minister that the Nigerian Governors’ Forum has agreed to support the Sovereign Wealth Fund came as a surprise to many Nigerians. CHUKWUDI AKASIKE writes that the controversy surrounding the SWF may not come to an end if the governors fail to speak out on the burning issue

When the Federal Government announced its intention to launch the Sovereign Wealth Fund, state governors across the country expressed their misgivings over the introduction of the fund.

Although the SWF has been launched, its introduction into the Nigerian polity did not come without controversies, especially from governors, who saw the development as asking for too much from the second tier of government.

However, the position of the governors did not stop the FG from lobbying them to have a change of mind and support the idea.

The argument in support of the SWF is that for Nigeria, whose economy depends largely on crude oil exports, such savings will provide funding for the country’s infrastructure development. Social amenities such as housing, health, education, roads, and railways will be provided if the proceeds of the SWF were properly utilised, experts say. Also, it is believed that the Vision 2020 of the FG will be easily realised if the two tiers of government contribute to the fund.

The debate on whether the states should give the fund the necessary backing or maintain their stand on disapproving the idea was still on when the Minister of Finance, Dr. Ngozi Okonjo-Iweala, announced at the Rivers State Investors’ Forum that the federal and state governors had agreed to go ahead with the SWF.

The declaration came to many as a surprise because the Chairman of the Nigeria’s Governors’ Forum, Mr. Rotimi Amaechi, made it clear that they were not in support of the fund. Amaechi said it was necessary for governors to get the position of the people before arriving at a conclusion on the issue.

He said, “The governors are not against the Sovereign Wealth Fund, but what we are saying is that the law of the country should be respected. Our argument is based on the fact that Section 162 of the Constitution says nobody in Nigeria, not even the National Assembly has the right to seize the money belonging to the states.

“So if you want us to contribute to the SWF, you must first give us our money. Then we will go back to our people and ask them if they want us to contribute to the SWF. But what we have had at the national level nearly amounts to kidnapping of our money.

“We can’t be saying that we should stand by the rule of law and at the same time, we say we should obey the rule in man. We must decide what we want. The SWF has to be within the ambits of the law.”

But suddenly, the minister declared that the FG had been able to convince the governors on the matter. This statement was made to the hearing of the NGF chairman.

It will be recalled that at a point, the governors said they had taken the FG to court over the creation of the SWF, a position, which they later denied.

Surprisingly, Amaechi was silent on the minister’s disclosure and even when he spoke at the event that lasted for two days, he apparently avoided responding to Okonjo-Iweala’s revealing remarks. The minister had commended Amaechi for paving the way for negotiations and discussions that eventually led to the accord reached on the SWF.

However, a close source at the Government House in the Rivers State capital, explained that although the minister announced that governors and the FG had agreed on the SWF, it was better to wait for the governors’ response. The source, who craved anonymity, explained that it would be difficult to immediately conclude that the governors had given their support to the FG-initiated SWF.

“Let us leave it until there is a response from the Nigerian Governors’ Forum. Since the minister said it and there was no response to it, the best thing to do is to wait for a time that the governors will respond to it. For now, we cannot say if the governors have agreed to the SWF or not. But we know that the chairman of the NGF will soon react to the issue,” the source said.

Apart from the governors’ initial uncanny disposition to the Federal Government-initiative, many have questioned the rationale behind the introduction of the SWF. The national leader of Action Congress of Nigeria, Asiwaju Bola Tinubu, described the fund as illegal, adding that the fund was another name given to Excess Crude Account with the intention of taking it to the House for an illegal constitutional amendment.

“When an act confiscates and contradicts the constitution, Section 162 of the constitution says all revenue must be distributed. You cannot act unconstitutionally if you are a government of rule of law. You are confiscating the money of the state; you are violating the constitution; it is illegal. It is an amendment to the constitution if it is not seen clearly by Nigerians; otherwise, Section 162 of the constitution is useless.

“What are the steps to be taken before an amendment to the constitution takes effect. That is clear there. I ask, if you are a regular saver and your child is dying of anaemia in a hospital and you say you are saving for that child to inherit, will you say you must save that money and not pay for the blood if the child needs blood transfusion? The states say this is our time to develop, why are you forcing them? You can save the FG’s portion,” Tinubu stated.

Still on the strange silence of the governors on the issue, the former South-South Vice Chairman of the All Nigeria Peoples Party, Mr. Asukewe Iko-Awaji, described the governors’ sudden calmness on the matter as a sign of a volte-face and indifference to things that directly affect the masses.

Iko-Awaji said the minister’s declaration at the investors’ forum was not concocted, maintaining that the governors might have reached an accord with the FG without informing their people.

He said, “If the chairman of the NGF did not react after the statement from the minister of finance, then it means they have agreed to go ahead with the SWF. But let us look at it this way; if the motive behind the creation of the fund is genuine, then it is good for Nigerians. Whether they are going ahead with the fund or not, government should know that what Nigerians want is an improvement in the economy through the provision of infrastructure and employment opportunities for youths.”

Also, the Rivers State Publicity Secretary of the ACN, Mr. Jerry Needam, was of the view that the governors were always keeping quiet on sensitive matters that concerned their people and he called on them (governors) to open up on the SWF. Needam who expressed worry over who would manage the SWF, said the funds may be embezzled or used for election campaigns in the future.

In his remarks, the National Publicity Secretary of the African Renaissance Party, Mr. Jackson Omenazu, also said most governors were not ready to represent the people. He said if the governors were against the SWF and the minister openly said they had reached an accord with the FG on the subject, it was the responsibility of the NGF chairman to react swiftly to the claim.

He said “If the governors are against the SWF and the minister is saying they have agreed to support the fund, then what is this criminal silence all about? The best thing for the governors to do through their chairman is for them to confirm or deny the position of the minister.”

From the foregoing, Nigerians may not have seen the end of the controversy surrounding the SWF.


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