In the evolution of post-independence Nigerian fiscal federalism, the Aboyade Technical Committee of 1977 sought to modernize revenue sharing by introducing five socio-economic principles. Which operational defect primarily led the Okigbo Presidential Commission of 1980 to discard the Aboyade recommendations in favor of a new formula?
- The criteria relied on complex, highly technical indicators such as absorptive capacity and fiscal efficiency that lacked reliable statistical data for practical implementation across states.Answer
- BThe committee recommended allocating fifty percent of mineral revenue directly to oil-producing states under the derivation principle, causing severe federal deficits.
- CThe report mandated that all local government revenues be placed under the exclusive legislative control of the federal government through military decrees.
- DThe formula granted absolute fiscal sovereignty to regional governments, dismantling the central Distributable Pool Account framework established under colonial federalism.
Answer
The Aboyade Technical Committee's formula was rejected because it relied on complex, highly technical principles—such as absorptive capacity, fiscal efficiency, and independent revenue effort—that were unquantifiable and impracticable due to a lack of reliable statistical data.
The correct option highlights the main reason for rejecting the Aboyade Committee's 1977 revenue allocation formula. The committee introduced sophisticated socio-economic criteria (Equality of Access, National Minimum Standards, Absorptive Capacity, Independent Revenue Effort, and Fiscal Efficiency). However, measuring these variables required statistical data that Nigerian institutions lacked, making the formula impracticable and contentious.
Step-by-Step Solution
Key Concept
Aboyade Technical Committee (1977) vs. Okigbo Commission (1980) Principles
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