To address the issue of states struggling to pay standard minimum wages in Nigeria, governors must transition from being mere administrators to becoming drivers of their local economies. More than ever, Nigeria needs fiscal federalism. Continuing with the current centripetal federalism will only push the Nigerian state further into an abyss.
Historically, Nigeria practiced centrifugal federalism during the First Republic. During this period, Nigeria was self-sufficient, feeding its citizens and dominating the African continent during the era of decolonization. The regional economies at the time produced world-class educational institutions and other developmental infrastructures. Importantly, regional governments did not rely on federal allocations to pay their workers.
The current practice of centripetal federalism, introduced by military rule, is the root cause of Nigeria’s economic setbacks. To move forward, we must seek a constitutional review that, among other things, returns the decentralized economic management of the country.
What does this mean? It means that corporations must be registered by local authorities, regulations must be administered primarily by the states, and corporate taxes must be collected by the states.
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