RESEARCH PROPOSAL AN OVERVIEW OF CORRUPTION AND THE TRENDS OF DEVELOPMENT IN NIGERIA “A CASE STUDY OF THE NIGERIA FOURTH REPUBLIC”

CHAPTER ONE INTRODUCTION 1.1

BACKGROUND TO THE STUDY Contrary to popular belief, free markets and noninterventionism are not remedies for corruption. No system is entirely free of corruption. Furthermore, corruption exacerbates the already difficult circumstances of States in conflict situations and those with economies in transition. It is widely accepted that corruption is an impediment to development. If not addressed as a priority, it may hinder all other efforts to effectively advance the development agenda, both at the international and the national level. At a minimum, the fight against corruption requires unconditional commitment from the political leadership and a corruption-free judiciary. Ideal democratic orientation of any contemporary society presumes citizenry participation in the governance of his or her society. In order to showcase adequate involvement of people in decision making processes and belief towards governance in the context of democratic values grassroots government was established. As a result of the complexity of corruption, its effects on the systemic existence of its victims as does its prevalence through the efforts of its perpetuators, its definition has continued to be shrouded by value preference and differences (Akindele and Adeyemi, 2011). The understanding of corruption connotes inappropriate act of people economically, politically, socially and culturally. Irrespective- of the sectorial aspect of corruption enmeshed, its evaluation could be underscored on the premise of societal prevailing orientation that mandated ones behaviour socially, economically, politically or culturally. According to the World Bank and Transparency International (TI), a leading global anticorruption watchdog, corruption is the abuse of public office for private gains for the benefit of the holder of the office or some third

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party. Viewed from these definitions, political corruption can be broadly understood as unethical behaviour, which violates the norms of the system of political order (Heidenheimer and Johnston, 1993). Nwabueze (2002) in his own contribution adopted a sociological approach to the definition of corruption. Corruption according to Harsh (1993), is a practical problem, involving the outright theft, embezzlement of funds or other appropriation of state property, nepotism, and granting of favor to personal acquaintance. It has been argued that corruption involves behaviors which deviate from the moral and constitutional requirements. Kalu (1991) conceives corruption as the conscious and well planned act by a person or group of persons to appropriate, by unlawful means, the wealth of another person or'' group of persons. Corruption can also be seen as diversion of resources from the betterment of the community to the gain of individuals at the expense of the community. Odey (2002) conceptualizes corruption in Nigeria as the air which every living person breathes in and out, According to him, nobody makes any effort to breathe in the air, it comes naturally. Corruption in Nigeria has become so naturalized that' many of us simply become corrupt without making any effort and often even without knowing it. Corruption, an ethical and moral problem which varies from place to place, time to time, culture to culture and with the level of economic development (Aluko,2008), is a global phenomenon that affects developed, developing and underdeveloped nations of the world. Corruption is the major cause of poverty around the world. It occurs at all levels of governance, that is, local and state. All over the world, the perception of corruption especially in public places is very high. This is because, corruption undermines every aspect of national development among which are, political development, economic development, social development and so on.

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1.2

STATEMENT OF PROBLEM Corruption has already marred Nigeria and the surviving strenght is slim because it has eaten deep into the Nation's fabric and national life. It is more rampant in the public sector. The political office holders both at the federal, State and local level engage in bewilding corruption. A situation where this prevails, much will not be expected from the public-office holders and this is detrimental to the survival of democracy in Nigeria. This problem has become so endemic on the Nigerian populace that it calls for perpetual research to provide answers to some pressing issues and questions arising from the menace of corruption using the anti crime corruption agencies. Despite the crusades of anti-corruption in Nigeria, its magnitude appears to be on the high side. It has impaired hard work, diligence and efficiency. It has caused incalculable damages to the social and political development of Nigeria. It subverts honest selection processes and distorts prices. Furthermore, it weakens institutions, hampers investment and retards economic development. More importantly the resources that should be used for developmental purposes are being diverted from the society to private or personal use. This accumulation of the nation’s economic resources for personal benefits had variously contributed to the leakage of capital from Nigeria for illegal deposits abroad. In other words, it has a crowding out effect on the development in Nigeria. It’s contributing effects on poverty and poor infrastructural development is the more worrying. Nevertheless the extents of these negative effects are yet to be measured and quantified. It is against this background that this study was inspired. The study intends to examine the extent and the magnitude of corruption and the trend of development of Nigerian economy using only Nigeria Fourth Republic cases. The paper will at the end provide answers to the following questions

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i

What types of corrupt practices are noticeable in Nigeria during the fourth republic?

ii

What is the economic basis for these corrupt practices during the fourth republic? iii

What are the extent and the magnitude of its impact on development of the Nigerian economy?

iv

How can corruption be checked or eradicated in Nigeria?

1.3

OBJECTIVES OF THE STUDY The broad objective of this research is to evaluate the overview of corruption and the trends of development in Nigeria. (A case study of Nigeria fourth republic) The specific objectives are;

1.4

1

The study will provide account of the type of corruption practices during fourth republic.

2

Examine the trend of development during fourth republic caused by corruption.

3

To examine corruption as the root cause under development in the history of Nigeria.

4

Examine the policies and strategies to eradicate corruption in Nigeria. SCOPE OF THE STUDY This study will look into how corruption has been like since the period of Independence in Nigeria especially in the Fourth Republic. It will cover corruption cases in Administration since inception (from 1999 – till date) in Nigeria.

1.5

METHODOLOGY The methods of data collection is basically secondary data by using 1.

Document Analysis

Document analysis is a method of collecting data by looking at documents. Two basic types here are: 1.

Historical/Library/ Archival and 4

Generally, Document Analysis is the method by which we generate data from records and documents whether in print or electronic forms, audio or visual, published or broadcast. Historical method enables the researcher to reconstruct the past in an objective and systematic manner as he or she set out to answer research questions, meet research object or test hypothesis. Because data collected through this method have been recorded by others and not by the researcher in the first instance, such data must be tested for the following: Authenticity, Accuracy and Significance. It is as demanding and testing like any other social science method of collecting data. The measuring instruments here include research notes, tapes, magazines, journals, textbooks etc. Content Analysis is about collecting data from documents. 1.6

LIMITATIONS OF THE STUDY This study is a qualitative study; therefore all efforts will be generated to reading of articles, document, journals, internet news, books and all anti corruption leftlet in other to document the best informations. Also to subscribe for internet is costly in Nigeria, therefore money will be involve in the project.

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SIGNIFICANCE OF THE STUDY The totality of this study will provide the reason for underdevelopment in Nigeria, using the trend of development in Nigeria during the fourth republic. Because the issue of corruption is not only found within the African continent alone, it encompasses all other continent. Corruption is endemic everywhere, the costs of addressing corruption are prohibitively high, and the few resources that exist should be spent on enforcement measures, such as high – profile government watchdog agencies.

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But, in fact, there is increasing evidence that the economic costs of corruption are enormous; levels of corruption vary widely among developing countries; controlling corruption is feasible, and strategies to address corruption need to pay more attention to its root causes and thus to the roles of incentives, prevention, and specific economic and underdevelopment nature it has caused. 1.8

CHAPTERIZATION Against this backdrop, this paper is divided into six sections. The first section deals with introduction; the second section focuses on conceptual clarification; the third section centres on historical trajectory of corruption in governance in Nigeria; the fourth section discusses corruption in the Fourth Republic; the fifth section examines financial corruption and national development in Nigeria; while the sixth section is the conclusion.

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REFERENCES Akindele S.T. (1990). Corruption and Economic Retardation: A Retrospective Analysis of Nigerians Experience since Independence. In: Readings in the Political Economy of Nigeria since Independence. Ed. by Bamisaye, O. A (Lagos, Nigeria: Ventures Limited,. Aluko M. A. O (2002). The Institutionalization of Corruption and Its Impact On Political Culture And Behavior in Nigeria Nordic Journal of African Studies 11(3): 393-402. Babalola A (1995) Corruption and Political Crisis in Nigeria: A Sociological Viewpoint the Conference Proceedings of the Nigerian Anthropological and Sociological Association. Babalola and Osoba (2011) On Corruption and Political crisis in Nigeria http//:www.corruption watch.org/features/html accessed August ‘13. Babatope Babalobi (2008) Causes of Corruption in Nigeria, Report of a Workshop for Civil Society Organizations involved in the fight against Corruption, organized by Zero Coalition, (ZCC) Lagos, December 11-12. Bassey O.E. and Utre (2007), E.I. Corruption and National Development in Nigeria: The Way Forward In Sophia: An African Journal of Philosophy. 1.2 (2007). Bassey Patrick (2011). The Culture of Corruption in Contemporary Nigeria: The Way out Unpublished American. Journal Social Management Sciences, 2(1): 91-99 BBC News, November 10, 2009, http://news.bbc.co.uk/2/hi/africa/8322992.stm (accessed August 17, 2013). Coker, M. A. (2006). Corruption and Direct Foreign Investment in Nigeria in Sophia: An African Journal of Philosophy.9.1. Dahl, Robert. (1998) A On Democracy (New Haven and London: Yale University Press.

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Dike, Victor (2011). Corruption Control: A New Paradigm for Effective Control in Nigeria OnLine Publication Nigeria World.com/feature/article/corruption.html. Human Rights Watch (2007), “Chop Fine”: The Human Rights Impact of Local Government Corruption and Mismanagement in Rivers State, Nigeria, vol. 19, no. 2(A), January 2007, http://www.hrw.org/node/11043. Human Rights Watch (2007), Criminal Politics: Violence, “Godfathers” and Corruption in Nigeria, vol. 19, no. 16(A), http://www.hrw.org/node/10661. Ibrahim, Jibrin (2003) “Corruption in Nigeria: Transition, Persistence and Continuity” in The Nigeria Social Scientist 6(2) 3 – 13. Khan Mushtaq (1999): “The new political economy of corruption”, Department of Economics, School of Oriental and African Studies, University of London, working paper. Mauro, Paolo. 1995. Corruption and Growth.‛ Quarterly Journal of Economics 110 (1995): 681712. Ndiulor Tony (1999). Price Nigeria is Paying for Corruption The Guardian Newspaper On Line March 17, 1999. NORAD, (1997) ch.1, ch.2 & ch.4, Jan. 2000; Amundsen, 1997; Girling. Nye J.S. (1967). Corruption and Political Development: A Case-Benefit Analysis The American Political Science Review. (417-427). Ochulor, Chinenye Leo, Metuonu Iheanacho C. and Asuo, Oduora Okpokam Corruption in contemporary Nigeria: The way out American Journal of Social and Management Sciences Science Huβ, http://www.scihub.org/ 2011. Osoba J. A.(1996); (2002) Corruption in Nigeria: Historical Perspectives Review of African Political Economy.69. 23:371-386 (1996)

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Rose-Ackerman, Susan. 1999. Corruption and Government: Causes, Consequences, and Reform. Cambridge: Cambridge University Press. Transparency International. Global Corruption Report 2007: Corruption in Judicial Systems. Cambridge: Cambridge University Press, 2007.

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CHAPTER TWO 2.0 2.1

LITERATURE REVIEW AND THEORETICAL FRAMEWORK LITERATURE REVIEW Corruption is a disease, a cancer that eats into the cultural, political and economic fabric of society, and destroys the functioning of vital organs. In the words of Transparency International, “Corruption is one of the greatest challenges of the contemporary world. It undermines good government, fundamentally distorts public policy, leads to the misallocation of resources, harms the private sector and private sector development and particularly hurts the poor”. Corruption is found almost everywhere, but it is stubbornly entrenched in the poor countries of Sub-Saharan Africa, it is widespread in Latin America, it is deeprooted in many of the newly industrialised countries, and it is reaching alarming proportions in several of the post-communist countries. Corruption has been the subject of a substantial amount of theorising and empirical research over the last 30 years, and this has produced a bewildering array of alternative explanations, typologies and remedies. However, as an extensively applied notion in both politics and social sciences, corruption is being used rather haphazardly. Corruption is understood as everything from the paying of bribes to civil servants in return for some favour and the theft of public purses, to a wide range of dubious economic and political practices in which politicians and bureaucrats enrich themselves and any abusive use of public power to a personal end. Besides, corruption is in itself a many-faceted phenomenon and the concept of corruption contains too many connotations to be analytically functional without a closer definition. The forms of corruption are diverse in terms of who are the actors, initiators and profiteers, how it is done, and to what extent it is practised. Also the causes and the consequences of corruption are

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complex and diverse, and have been sought in both individual ethics and civic cultures, in history and tradition, in the economic system, in the institutional arrangements, and in the political system. The intention of this article is to classify the various forms of corruption, in order to make corruption into an analytically useful concept for social sciences, and in particular political science. First of all, some definitorial exercises will discuss the different forms of corruption, and locate corruption as an element in a broader political and economic setting. The connection between corruption strictly defined and a number of concepts related to corruption will also be addressed in the first part of this paper. Secondly, the main of causes and effects of corruption will be discussed, and the relationship between corruption and economic and political developments. Finally, some references will be made as to the most relevant methodologies by which studies of corruption can be carried out. 2.1.1

WHAT IS CORRUPTION? The word corruption is originally from the Latin verb rumpere which means to break (AbdulIsmail, n.d.). Corruption means the breaking of a certain code of conduct for the personal benefit of the perpetrator. Different scholars from social sciences, psychology, political sciences and religious studies have attempted a working definition for corruption from their various disciplines. However, all of the working definitions are interwoven. Firstly, defination will be giving by World Bank, Akindele, Osoba and many others. The World Bank (1997) defines corruption as: “The abuse of public office for private gains. Public office is abused for private gain when an official accepts, solicits, or extorts a bribe. It is also abused when private agents actively offer bribes to circumvent public policies and processes for competitive advantage and profit. Public office can also be abused for personal

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benefit even if no bribery occurs, through patronage and nepotism, the theft of state assets or the diversion of state resources”. Viewed differently, corruption is an anti-social behaviour committed by individuals and/or social group, which entails conferring unjust or fraudulent benefits on perpetrators, the behaviour is strictly inconsistent with the laid down rules and moral ethos of the land. The repercussion of the behaviour is the likelihood of subversion of communal wealth thereby leading to reduction of the capacity of the legitimate authorities, be it federal, state or local government to provide fully for the material and spiritual well being of all members of society in a just and equitable manner (Osoba, 2000, Agara, and Olarinmoye, 2009). Sen (in Aluko 2009:2) defines corruption as the violation of established rules for personal gain and profit. Akindele (1995) defines it as any form of reciprocal behaviour or transaction where both the power/office holder can respectively initiate the inducement of each other by some rewards to grant (illegal) preferential treatment or favour against the principles and interest of specific organization (or public) within the society. (Osoba 1998:378) defines corruption as an "anti-social behaviour conferring improper benefits contrary to legal and moral norms, and which undermine the authorities" to improve the living conditions of the people. Corruption also describes the behavior of officials in the public and private sectors, involving improperly and unlawfully enriching themselves and/or those closely related to them, or induce others to do so, by misusing the position in which they are placed (Agbu, 2003). Dike (2011) notes that though some of these definitions of corruption have been around for over decades, the recent development in Nigeria where discoveries of stolen public funds run into billions of US Dollars and Nigeria Naira, make these definitions very adequate and appropriate.

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He further observes that corruption is probably the main means of accumulating quick wealth in Nigeria. It has contributed immensely to the poverty and misery of a large segment of the Nigerian population. Corruption has become institutionalized in Nigeria. Aluko (2002) notes, that. Corruption now appears to have become a permanent feature of the Nigerian polity. It had become completely institutionalized, entered into the realm of culture and the value-system; it is now a norm and no longer an aberration. The young ones are born into it, grow up in it, live with it, and possibly die in it. The aged are not left out as they are re-socialized and begin to conform to it. This observation by Aluko is quite true of the situation in Nigeria where corruption has become endemic. The effect is noticed everywhere. The family is not left out. When parent sends their wards on errand the children will expect some gratification from the parent and some unsuspecting parent gratifying their wards with gifts. When the children grow up, corruption becomes part of their daily life. Corruption has come up as a thematic constituent of this renewed paradigm, in which development necessitates economic reform, which is again dependent on political and administrative reforms like good governance and civil service reforms (CRS), accountability, human rights, multipartyism and democratisation. Besides, very high levels of corruption has been observed where the government is regarded as illegitimate in the eyes of the population (implying widespread disrespect for legal procedures), and in countries where the state plays an interventionist role in the economy. The role of the state and of politics is therefore essential to understand corruption. 2.1.2

THE STATE IS ALWAYS INVOLVED The decisive role of the state is also reflected in most definitions of corruption. Corruption is conventionally understood, and referred to, as the private wealthseeking behaviour of someone

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who represents the state and the public authority, or as the misuse of public goods by public officials for private ends. The working definition of the World Bank is that corruption is the abuse of public power for private benefit. In Colin Nye’s classical and most widely used definition, corruption is “behaviour which deviates from the formal duties of a public role because of privateregarding (personal, close family, private clique) pecuniary or status gains; or violates rules against the exercise of certain types of private-regarding influence” (Nye 1967:417). A somewhat updated version with the same elements is found in the definition by Mushtaq Khan, who defines it as “behaviour that deviates from the formal rules of conduct governing the actions of someone in a position of public authority because of private-regarding motives such as wealth, power, or status” (Khan 1996:12). In other words, corruption is a particular (and, one could say, perverted) statesociety relation. On the one side is the state, that is the civil servants, functionaries, bureaucrats and politicians, anyone who holds a position of authority to allocate rights over (scarce) public resources in the name of the state or the government. Corruption is when these individuals are misusing the public power they are bestowed with for private benefit. The corrupt act is when this responsible person accepts money or some other form of reward, and then proceeds to misuse his official powers by returning undue favours. For instance, it is an act of corruption when a state official takes a bribe to render some public service that is supposed to be free of charge or demands more than the official cost of it. The involvement of state officials in corruption is also emphasised in an alternative definition, where corruption is seen as “a form of secret social exchange through which those in power (political or administrative) take personal advantage of one type or another, of the influence they

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exercise in virtue of their mandate or their function” (Méry cited in de Sardan 1999:49). In sum, almost every definition (or rather conceptualisation) of corruption has a principal focus on the state and politics (“the corrupted”), and a “demand-oriented” perspective. On the other side of a corrupt act is nevertheless the “supply side”, and some theories and conceptualisations exist that emphasise the “corrupters”, those who offer the bribes, and the advantages they gain. These suppliers are the general public, or in other words – the non-state society. The counterparts to the corrupt officials are any non-governmental and non-public individual, corporate and organisational, domestic and external. Corruption also exists within and between private businesses, within nongovernmental organisations, and between individuals in their personal dealings, without any state agency or state official being involved. There is corruption also in the form of bribing, swindling, and mafia-methods within and between private businesses, there are treacherous individuals and disloyal employees also in private firms. This kind of corruption may even have repercussions into the political system as it destroys the public morale, and it may be symptomatic for the general economic and moral development of a society. However, most definitions of corruption will exclude this intra-societal corruption, and emphasise corruption as a state-society relationship. This is quite appropriate as long as the focus is not exclusively on the personal, cultural and social aspects of corruption. Business-internal corruption can and will normally be handled as a disciplinary problem within the firm, as a judicial problem within a given legal framework, or as a moral problem within a cultural setting. Therefore, in contrast to corrupt state-society relations, business internal corruption will not necessarily have to consider the broader political and economic issues.

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2.1.3

Political corruption and bureaucratic corruption (“grand” vs. “petty”) In the definition shared by most political scientists, political corruption is any transaction between private and public sector actors through which collective goods are illegitimately converted into private-regarding payoffs (Heidenheimer et. al. 1993). This definition does not, however, distinguish clearly between political and bureaucratic corruption. It establishes the necessary involvement of the state and state agents in corruption, without any notion as to the level of authority where corruption takes place. In a more strict definition, political corruption involves political decisionmakers. Political or grand corruption takes place at the high levels of the political system. It is when the politicians and state agents, who are entitled to make and enforce the laws in the name of the people, are themselves corrupt. Political corruption is when political decision-makers use the political power they are armed with, to sustain their power, status and wealth. Thus, political corruption can be distinguished from bureaucratic or petty corruption, which is corruption in the public administration, at the implementation end of politics. Even when the distinction between political and bureaucratic corruption is rather ambiguous as it depends on the separation of politics from administration (which is unclear in most political systems), the distinction is important in analytical and in practical terms. Political corruption occurs at the top level of the state, and it has political repercussions. Political corruption not only leads to the misallocation of resources, but it also affects the manner in which decisions are made. Political corruption is the manipulation of the political institutions and the rules of procedure, and therefore it influences the institutions of government and the political system, and it frequently leads to institutional decay. Political corruption is therefore something more than a deviation from formal and written legal norms, from professional codes

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of ethics and court rulings. Political corruption is when laws and regulations are more or less systematically abused by the rulers, side-stepped, ignored, or even tailored to fit their interests (Friedrich 1993). Political corruption is a deviation from the rational-legal values and principles of the modern state, and the basic problem is the weak accountability between the governors and the governed. In particular in authoritarian countries, the legal bases, against which corrupt practices are usually evaluated and judged, are weak and furthermore subject to downright encroachment by the rulers. The formal legal framework of the state is therefore insufficient as terms of reference to assess and judge the problem of political corruption. Moral, normative, ethical, and indeed political benchmarks will have to be brought in, not at least because it will be necessary to discern legality from legitimacy when it comes to political corruption. Besides, whereas bureaucratic corruption normally can be dealt with through auditing, legislation, and institutional arrangements, the degenerative effects of political corruption cannot be counteracted by an administrative approach alone. Endemic political corruption calls for radical political reforms. Political corruption (usually supported by widespread bureaucratic or petty corruption) should furthermore be considered as one of the basic modes of operation of authoritarian regimes. It is one of the mechanisms through which the authoritarian power-holders enrich themselves. Here, corruption is rarely a disease that the responsible politicians are eager to avoid, it is a deliberate, wanted and applied practice; it is one of the rulers’ modes of enrichment and economic control. Political corruption is consequently a “normal” condition in authoritarian countries, although showing a great variety according to the various forms of authoritarianism. However, as demonstrated by a large number of corruption scandals in liberal democracies over the years, political corruption is not restricted to authoritarian systems. Nevertheless, by

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maintaining the link between authoritarianism and political corruption, and a definition of political corruption in terms of state prerogatives manipulated to serve the interests of the rulers, one will see that the essence of the problem of political corruption differs much between authoritarian and liberal democratic regimes. In democratic countries, the problem of political corruption is more of an incidental and occasional nature, and can be dealt with within the existing political system; by reforming, strengthening and vitalising the existing political institutions of checks and balances. 2.1.4

Private corruption and collective corruption (“individual” vs. “aggregated”) Observations as well as input from political theory have lead to a second analytically important classification of corruption, namely between private and collective forms of corruption. The degree to which the money or benefits collected through corruption is “privatised”, is varying. It may be extraction for the benefit of an individual who will share nothing or very little of the benefits with his equals, or it may be extraction for a particular group with some coherence and unity. The “private”, individual and intimate nature of corruption is repeatedly underlined because of the illegal and surreptitious nature of corrupt transactions. The illegality and immorality of corruption necessitates a collusion or conspiracy between individuals, or at least a certain closeness and confidentiality. As noted, Méry called it a form of secret social exchange (Méry cited in de Sardan 1999:49). Furthermore, corruption is regarded as “private” or individual also because private benefits are sought and collected. Corruption holds some private benefit for the corrupt actor, his family or his close friends.

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However, corruption may also be “collective”. First of all because corruption has a substantial economic effect in aggregate terms, but also because corruption may in itself be a deliberate way of resource extraction for the benefit of a larger group. Some definitions of corruption also emphasises the point that the rulers as a group or class, or as an institution or organisation, make unjustified use of their influence to extract resources for the benefit of the group as such. Many well-known and well documented cases of grand corruption has involved political parties (ruling parties in particular, but also prospective ruling parties), entire administrative bureaux, and national governments. Corruption has a strong inclination for “collectivisation”. To keep quiet and gradually take part in the practice is usually much less costly than to blow the whistle, inform, and confront. A conspiracy between individuals is easily extended into a larger practice involving colleagues, partners, assistants, patrons and superiors. Instances of petty corruption may therefore develop into larger networks, cliques and medium-sized brotherhoods, and finally into large-scale institutionalised corruption if unchecked, if there is “room for manoeuvre”. As corruption spreads, the social acceptance of it may also increase. When it is generally understood that there is a climate of corruption, still more people will believe it is inevitable and expected. In particular is corruption in high places contagious to lower level bureaucrats and other state agents, as these will follow the predatory examples of, or even take instructions from, their principals. 2.1.5

Redistributive and extractive corruption (“from below” vs. “from above”) In whose interest does corruption take place, and who benefits the most from corruption? The various definitions of corruption maintain that the state (or some state agent) is always involved, and that corruption is basically a particular state-society relationship. It is furthermore

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maintained that this relationship is based on a mutual exchange of benefits, that it is an exchange from which both the state (the state agent) and the society (the individual citizen, client or businessman) will draw some immediate and private benefit. This relationship of mutual exchange is rarely balanced, however. In aggregate terms corrupt practices will generate a flow of resources either from the society to the state (extractive corruption, or corruption form above), or from the state to the society (redistributive corruption, or corruption from below). As noted by Heidenheimer, some researchers have made the distinction between corruption initiated by the office-holder and corruption initiated by the favour-seeker (Heidenheimer et.al., 1993). This is a useful distinction, but as the initiator takes the initiative to corrupt the relationship presumably because he believes corruption will be to his benefit more than to his disadvantage, this distinction overlaps with the distinction between corruption in the interest of the state agents and corruption in the interest of non-state actors. To complicate this a bit further, it should be noted that upward and downward flows can take place simultaneously in different sectors and at different levels. Some ministries may for instance be very efficient in illegal resource extraction while others may be vulnerable to external influence and be extorted. Furthermore, the flows of resources differ much in quality. The resources exchanged can be countables like money, wealth and fiscal privileges to the one party, and uncountables like “influence”, “identity” and “security” to the other. This implies for instance that the state as a group or elite may extract substantial resources in the form of wealth and power from the nation or the society at large, while the society in return will have only symbolic resources like protection and national identity. In many cases, corrupt practices have established extremely well to do political and state-based elites (ruling classes) amidst poverty and recession. On the other hand, businesses and other groups may be very

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successful in getting tax exemptions and other privileges from corrupt officials in weak states, to the extent that the unity and coherence of the state and its policies are ruined, the policy implementation capacity ravaged, and the resources of the nation depleted. In extreme situations, the state may be held hostage to and torn apart by forceful groups in society. The effect of the corrupted state-society relationship, and the direction the aggregated flow of resources will take, is not given a priori. Only historical and empirical research into these relationship in given countries can reveal its true character. The role of corruption within this broader perspective of a state society relationship is, however, usually understood implicitly, and in aggregate terms as either benefiting certain sectors of the society (like business interests and emerging capitalist classes) or certain state elites (like juntas and single-party nomenclatures). 2.2

THE CAUSES AND EFFECT OF CORRUPTION IN NIGERIA In his paper Corruption in Nigeria: A New Paradigm for Effective Control Dike citing a report from Reuters a French News Agency notes the following organization and parastatal that were recently affected by corruption. Some official of the International Olympic Committee (IOC) lost their posts because they were found guilty of receiving bribes. All the commissioners of the European Union (EU), resigned because they too, had been found to be corrupt beyond acceptable limits. Corruption and mismanagement within local governments in Rivers State have severely impacted access by ordinary Nigerians to basic health care and primary education and how political violence and corruption have undermined Nigeria’s electoral system and denied ordinary Nigerians their right to freely choose their leaders. Nigeria has long held the unenviable reputation as having one of the world’s most corrupt public sectors, in which corrupt practices including the theft of public funds, bribery, and kickbacks

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pervade all levels of government. Between 1999 and 2003, Nigeria ranked last or second-to-last on Transparency International’s annual Corruption Perceptions Index. In 2006, the then-head of Nigeria’s Economic and Financial Crimes Commission, Nuhu Ribadu, estimated that Nigeria lost some $380 billion to corruption between independence in 1960 and the end of military rule in 1999.54 Nigeria’s corruption epidemic has continued since then. Exact figures of its costs are impossible to determine, but some diplomats estimated that between 1999 and 2007, Nigeria lost a minimum average of $4 billion to $8 billion per year to corruption. In Nigeria’s four leading oil-producing states, for example, where state budgets alone exceed the total central government budgets of many West African countries, the state and local governments have grossly failed to progressively realize the basic health and education needs of their citizens. Instead, public funds that could have been used to improve the lives of ordinary Nigerians have been squandered and siphoned off by the governing elite. The level of corruption and accompanying lack of development in the major oil-producing states, however, is by no means unique. The federal government’s revenue totalled $45.4 billion in 2008, but 64 percent of Nigerians live on less than $1.25 a day and the maternal and infant mortality rates in Africa’s largest oil-producing nation are among the worst in the world. Corruption also lies at the heart of much of the political violence in Nigeria, as politicians use stolen public funds to sponsor criminal gangs to rig elections, which are often marked by violence. Corruption fuels and rewards this violence and contributes to the impunity enjoyed by those responsible for such abuses, which both denies justice to victims and obstructs reform. The causes of corruption are many and they have political, social and cultural variables. The most common cause of corruption is poverty. Poverty is the main cause of corruption in third world countries. Nigeria is rated among the most corrupt country in the world. Nigeria is rich in

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different resources but because the leaders are corrupt, average masses do not enjoy the resources the nation is endowned with. According to a report from the workshop organized by ZCC, Lagos from Dec 11-12, 2012; Babalobi notes these following as the cause of corruption in Nigeria. 1. Weak Government institutions 2. Poor pay incentives 3. Lack of openness and Transparency in public service 4. Absence of key anti corruption tools 5. Ineffective political processes 6. Culture and acceptance of corruption by the populace 7. Absence of effective political financing 8. Poverty 9. Ethnic and religious difference Osoba (1995), Akindele (1995) and Dike (2008) add the following to causes of corruption; 1) Great inequality in distribution of wealth; 2) Political office as the primary means of gaining access to wealth; 3) Conflict between changing moral codes; 4) The weakness of social and governmental enforcement mechanisms; and 5) The absence of a strong sense of national community (Bryce, 1921). 2.2.1

THE EFFECTS OF CORRUPTION The effect of corruption on the national polity cannot be overemphasized. Corruption usually has negative impact on the socio-political and economic development of any nation. The menace

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should be tackled before the cankerworm spread to every facet of the polity. Dike notes the following effects of corruption on the nation. 1.

Reduction in public spending on education. The effect of corruption on education comes from the fact that the government spends relatively more on items to make room for "graft" and corrupt government officials would shift government expenditures to areas in which they can collect bribes easily.

2.

Large and hard-to-manage projects, such as airports or highways, make fraud easy. In addition, poverty and income inequalities are tied to corruption. Development projects are often made unnecessarily complex in Nigeria to justify the corrupt and huge expense on it. The new national stadium in Abuja, which is said to have gulped millions of Naira more than necessary, is a case in point.

3.

The effect of corruption is noted on the poor state of infrastructure and road network. Most of the infrastructures are not well built and the roads not well constructed. Barely the government would open a road network that potholes and erosion will carry it away. The state of most roads that have just been constructed is appalling. As a result of the poor state of the road, accidents are common on this road. Recently some buildings are collapsing in the country as a result of corruption. Those who supposed to supervise and approve the building construction thoroughly would not do so once they collect graft from the owner of such building. The shady job done by this contractor has led to the untimely death of many people.

4.

Many of the leaders are still corrupt and amassing wealth to themselves. Worst still is the security outfit that is saddled with the responsibility of securing the nation has been caught aiding and abetting armed robbers to unleash terror on the masses. Poverty is the result of

24

corruption. Despite the huge resources the nature has endowed on the nation most people are still languishing in penury and misery. Corruption causes a reduction in quality of goods and services available to the public, as some companies could cut corners to increase profit margins. Corruption effects investment, economic growth, and government expenditure choices; it also reduces private investment. 2.3

THEORETICAL FRAMEWORK

2.3.1

Theory of redistributive corruption In what can be called the theory of redistributive corruption, the state is the weaker part in the state-society relationship. Here, various social and economic groups, interests or individuals are organised and powerful enough to draw more benefit from the corrupt practices they engage in with the state as a counterpart, than is the state and the ruling elite. The main beneficiaries of the resources extracted, privatised and consumed are not the political and state-based elite, but state resources are depleted and distributed to various groups and interests according to the power configurations in each country. (De Sardan 1999) The theory of redistributive corruption is based on the experience of some of the most fragmented states in the world, like Bangladesh where state degradation is largely due to the relative power of clientelist networks, and Russia where there is an extreme growth in mafia activity. The focus is mainly on the “subversive” groups and powers, and the degenerative effects of this kind of corruption on state institutions and the national economy. Here, politically strong and organised groups will for instance be able to challenge state authority “from below” through corruption. Though corruption, alliances will be forced with functionaries who will deliver state services and goods; politicians will be bought to tailor rights and regulations that will benefit

25

those who pay for it; and political influence will be bribed or extorted as the regime’s mere survival may depend on political support from these groups. Who, in society, will benefit the most from this kind of corruption depends on the local distribution of forces. It might be powerful ethnic or regional groups or clans who are strong enough to extract much more from the state than their fair part of public investments, development projects, international aid, regional autonomy and representation in national institutions. It might be foreign or local corporate interests that are able to buy under-priced national resources, concessions, preferential treatments, permissions, and tax exemptions. It might be the general population, individuals who are able to buy benefits like tax exemptions, subsidies, pensions, or unemployment insurance, or get preferential access to privileged schools, medical care, housing, real estate or ownership stakes in enterprises being privatised. The loser in this game is the state and its regulating capacity. When private citizens, commercial businesses (local and international) and various interest groups (formal and informal, modern and traditional) are able to buy national and public resources cheaply, to buy exceptions, privileges, immunity and impunity through the use of kickbacks and mafia methods vis-à-vis public officials, the state will be eroded. The effect of “redistributive” corruption is that the state is rendered incapacitated and politically impotent. The capacity of the state to extract taxes and render public services will be eroded; its ability to implement coherent policies is destroyed, as well as the state’s ability to transform the society and the economy according to political priorities and to execute rational development policies. Furthermore, redistributive corruption will “particularly hurt the poor” because resources are privatised and redistributed according to the ability of groups to influence policies through

26

pressure and bribes, and not through the principle of “one man one vote”. Resources will not be distributed according to “universalistic” or ideological considerations of needs and fairness. Those in most need of political redistribution, in terms of basic public services like schools, health, social services, and state protection, will suffer the most when the state’s capacity is crippled. Feudalisation is a term that has been used when weak states are manipulated by strong societies, when the state is losing control to “civilian” forces. Feudalisation refers to the “privatisation” and “decentralisation” of the state, and underlines the clientelist relationship involved. Feudalisation occurs when entire geographical areas, economic sectors and/or military units are taken over by “private” interests. In the short run, a ruler might benefit from deliberate feudalisation in terms of loyalty (from local or regional strongmen, clientelist groups or vassals), and in terms of an assured delivery of the votes for the ruling party in elections, but in the long run the unity of the state is jeopardised. The case par excellence is Russia, where the control of large tracts of the state’s prerogatives and institutions like regional tax bases, military regions, security operations, and even legislation, have been handed over as fiefs to private powers like bankers, private companies and military leaders4. In Cameroon, in return for loyalty and the delivery of votes, the president and ruling party have given certain regions ruled by ancient dynasties almost unrestricted powers5. The president has bought their loyalty by giving them the exclusive right of local taxation, and the “palace guards” of the have developed into paramilitary forces with unrestricted tribunals and dreaded prisons. In both cases, the problem is that when the ruler or the state elite through “feudalisation” is able to retain and secure its control of the central government and of important regions, the everlasting faithfulness of the latter is never guaranteed.

27

2.3.2

The theory of extractive corruption In the alternative view, in what can be called the theory of extractive corruption, the state is the stronger part in the state-society relationship. According to this theory, the corrupted (the state or some state agent) benefits the most from corruption and the corrupter is more or less a passive player. Essentially, the ruling elite is the strongest force is society, this elite or class uses the state apparatus as its instrument to extract resources from society, and it does so for the benefit of the rulers. This theory is partly based on the operation of authoritarian countries in general, and on the experience of the neo-patrimonial states in particular. The theory mainly applies where the state is not only the strongest force in society, but also where a ruling elite has developed into a dominant and ruling class in control of the powers of the state. The theory also emphasises the well-known remark that all power tends to corrupt, and absolute power corrupts absolutely. That is, the more political power is concentrated exclusively in the hands of a few individuals, the greater the temptation for power abuse, selfish wealthseeking and primitive extraction. The theory of extractive corruption in based on the mainstream political science notion of authoritarianism, namely a rule basically in the interest of the rulers that is ultimately based on force. Authoritarian rulers are using the power capabilities of the state in the struggle for power, to attain, retain and increase their powers, and to accumulate resources from the nation and from the ruled, for private benefit. This understanding of authoritarianism dates back to the classic writings of the Greek philosopher Aristotle, who made the distinction between “rule of law” and “rule of force”. The rule of law was democratic rule for the benefit of the entire population (all citizens, the public or the nation as such), whereas the rule of force was an authoritarian,

28

perverted and corrupted form of rule for the advantage of the ruler (the tyrant or some oligarchy). (Johnston 1996) Authoritarian regimes have ever since usually been understood and portrayed in terms of some ruling elite or class that uses and misuses the powers of the state primarily to safeguard their own corporate or class interests, at the detriment of and usually in conflict with other groups and interests in society. In political terms, the means available for authoritarian rulers range from charisma and persuasion to the overt use of violence. They may use sophisticated institutional arrangements like for instance presidential systems, single party systems, and the cooptation of rivals in order to restrict participation and power sharing. They may use censorship and electoral fraud, establish unjust laws and disrespect the laws they have made themselves, and use human rights violations like political surveillance and intimidation, imprisonment and torture. In economic terms, corruption, and in particular political corruption, is only one of the many modes of economic accumulation and private appropriation applied by authoritarian rulers. The theory of extractive corruption is furthermore derived from the relatively stable and rather flexible neo-patrimonial political systems found in most of Africa and in a few Latin American and Asian countries. Neo-patrimonialism is a widely used concept in political science for this sub-category of non-democratic and semi democratic regimes characterized by pervasive patronclient structures, the no distinction between public and private, and political weakness. Neo-patrimonialism is defined as a political system where the chief executive maintains authority through personal patronage, rather than through ideology or law. As with the classical or “traditional” patrimonialism described by Max Weber, the right to rule is ascribed to a person

29

rather than an office, and exercised more through the informal clientelist and nepotist practices than through formal routes of authority. (Leys 1965) What makes the neo-patrimonial system different from the patrimonial ones, is that the neopatrimonial regime maintains a façade of modernity, legality, rationality, and professional bureaucratic structures. However, underneath what appear to rational and legal processes and structures, the clientelist and patrimonial logics prevail. Relationships of loyalty and dependence pervade the formal and administrative structures, and leaders occupy bureaucratic and political positions less to perform public services than to acquire personal wealth and status (Bratton & van de Walle 1994:458). In neo-patrimonial systems, there is no clear distinction between the public and the private domain. Public office and position is seen as a personal asset and a personal right, and it is treated as a private resource. Thus, the entire political system is characterised by a deep and thorough privatisation and usurpation of public resources. Politics is to a large extent about distributing resources in the form of jobs, contracts, scholarships, gifts and other public resources to one’s relatives, friends and political allies. Furthermore, politics is about acquiring wealth and prestige through the system of prebendal accumulation, which has also been called “parasitism” and “kleptocracy”. That is, public authority is used by the rulers to extract resources from the ruled and from the nation’s riches. Public office is used to enforce the collection of prebends and “gifts” of all sorts from the dependent clients. Corruption, embezzlement, theft and extortion are used to make private fortunes, and political power is used by power-holders to enter into profitable businesses (and to establish monopoly rights, tax exemptions and other advantages for these). Nationalization,

30

indigenization, privatization, the allocation of monopoly rights, land entitlements, subsidies, subsidized credits, import and export licenses and tariffs, and a number of other public resources are likewise distributed according to the patrimonial logic. Clientelism is a basic feature of the neo-patrimonial system. This is the sophisticated hierarchic network of patron-client relationships through which the patrons grant services, positions, and public support to his clients, in exchange for political and material support. These clientelist “networks of reciprocities” or “nets of interaction” are used by patrons at different levels to build support through the extraction and distribution of wealth and prestige, constructing a pyramid of social differentiation. Villagers for instance relate as clients to landowners, traders, saints, local administrators and others taking the roles of patronising middlemen. These low class clients then offer electoral support, social prestige, religious support, labour and material and fiscal benefits to their patron, in return for his protection, leadership and a sense of belonging. From the level of the middlemen, the clientelist system extends all the way up to the president of the republic. In most Sub-Saharan African countries, long lasting patrimonial and clientelist practices have over the years established what has been called hegemonic elites, or ruling state-classes. These are composed of a rather small elite of politically and economically dominating families. Studies have shown that the countries like the Côte d’Ivoire and Cameroon is ruled and dominated by an elite composed of some 50 families or approximately 1000 individuals who are controlling most of the public as well as the private sector (Amundsen 1997). In neo-patrimonial countries, political corruption is an integrated part of the clientelist system, it is what is labelled in French “la fraude érigée en système”, institutionalised political corruption. Political corruption is here one of the economic backbones of the state elite, its domination and survival. The extractive capacity of a corrupted state apparatus is one of the raisons d’être of

31

holding power in neopatrimonial countries, and what various groups are fighting over. (Toulabor 1990) Corruption in neo-patrimonial regimes is largely seen as “collective” because of the apparent power of consumption of the rulers. Wealth is displayed to symbolize power, sometimes in blatantly pretentious ways. In addition to the private use and display of the riches extracted, public policies are tailored to benefit the ruling elites. As demonstrated from a number of African countries, the public use of state funds in neopatrimonial regimes is biased to benefit of the upper echelons of the urban, educated elite through for instance the systematic development of high-cost services, like university education and tertiary health facilities in the urban centres (capitals), at the detriment of low-cost rural services (Amundsen 1997). Secondly, in neo-patrimonial states, corruption and patron-client relations overlap into a pyramid of upward extraction. Note that patrimonial relations are not balanced. The flow of resources benefits the patron more than in benefits the clients, because each patron has a large number of clients in his web, and the patron accumulates more than he redistributes. Neo-patrimonial regimes are not efficient, legitimate nor development oriented regimes. For instance, the resources of the state are not redistributed to the needy or invested in production, it is extracted, amassed, and consumed by the rulers. Furthermore, in neo-patrimonial regimes, nominations and promotions in the public sector are made according to family and loyalty criteria, and not based on capability or meritocratic criteria. Commercial and corporate activities protected from market exposure and competition by political connections are promoted, but politically independent economic activity is squeezed by

32

formal and informal “taxation”. Thus, state-protected extractive and primitive capitalism is encouraged, while productive and industrial capitalism is discouraged. Besides, according to a recent hypothesis in political science, the authoritarian, neo-patrimonial regimes with the easiest access to resources will be extremely hard to democratise. In other words, where the ruling elite has a relatively easy access to revenues, rents or spoils from oil or mineral resources, or from other strategic resources or foreign support (so-called “primitive extraction” or “rentier states”), the ruling elite will be relatively independent of the ordinary or traditional economic activity in the country, as well as its overall economic development. Furthermore, they will be quite immune to the sufferings and protests of the population, and be able to defend themselves against internal rivals, because they will be able to purchase the necessary security in the form of military hardware, personnel and services on the international market. In other words, the neo-patrimonial state-class will, via their control of the state apparatus and the treasury, take control of the national resources. Several African civil wars, like the one in Sierra Leone, Congo/Brazzaville, Liberia, and Somalia, should primarily be understood as warlords fighting over the single most valuable asset in Africa: the state apparatus and its exclusive right to tax (or “tap”) the foreign companies which exploit the country’s mineral riches. 2.4

CONCEPTUAL FRAMEWORK Around corruption itself lies an array of related offences, and there is a confusing array of other concepts and notions linked to and sometimes used interchangeably with corruption. However, with the distinctions made between political and bureaucratic corruption and between extractive and redistributive corruption, these various practices, and the related concepts, can be located within a broader scheme.

33

“Bribery” is the payment of a fixed sum, a certain percentage of a contract, or any other favour in money of kind paid to the state official in charge of making contracts on behalf of the state or otherwise distribute benefits to companies or individuals, businessmen and clients. To pay or receive a bribery is corruption per se, and should be understood as the essence of both extractive and redistributive corruption. The bribery is the payment (in money or kind) given to or taken by the state official in a corrupt relationship. There are many equivalent terms to bribery, like kickbacks, baksheesh, sweeteners, grease money and pay-offs, which are all notions of corruption seen from below, as “redistributive” corruption. These are all payments needed or required to make things pass swifter, smoother or more favourably through a bureaucracy, or to avoid some burden. By “greasing palms” many corporations and business interests are for example able to buy political favours and escape the full burden of taxation and environmental regulations, others are able to buy protected markets and monopolies, import/export licences, etc. Bribery, however, is also extraction. It is a kind of “informal” taxation when public officials charge extra under-the-table payments or “gifts” from clients. It is an extractive form of bribery when a party boss goes on a promotion tour, and fills the luggage compartment of his car with “donations” and “gifts” from the “devoted followers” in his constituency. “Embezzlement” is theft of public resources by public officials, and as such it is understood as another form of misappropriation of public funds. The state official steals from the public institution in which he his employed and from resources he is supposed to administer on behalf of the state and the public. However, disloyal employees in private forms can also embezzle their employers and firms, and several kinds of resources may be embezzled.

34

Embezzlement is not considered as corruption from a strict legal point of view. In legal terms, corruption is a transaction between two individuals, one state agent and one “civilian” agent, where the state agent goes beyond the limits of the law and regulations in order to secure himself a personal benefit in the form of a bribe. Embezzlement is therefore regarded as theft, because it does not involve the “civilian” side directly. The general public is bestolen only indirectly when public funds are embezzled, and individual citizens have no legal right to present themselves as forfeited. This points to one of the dangers of embezzlement. There will have to be a political will as well as an independent judiciary and a legal capacity in order to clamp down on embezzlement. In authoritarian and semi-democratic countries, a system of embezzlement can develop in a closed institutional and moral universe, independently of the public moral and with few possibilities of public sanctions. Without a directly involved “civil” party in this, embezzlement is also irrelevant to any understanding of corruption as “redistributive” (any Robin Hood can be excluded). Within the theory of extractive corruption, however, embezzlement is seen as one of the most important modes of economic accumulation. Embezzlement is a fundamental part of the resource extractive capacity of the ruling elite, and may even be more important than extraction through bribes. In the early 1990s, the late president of the Côte d’Ivoire, Félix Houphouët- Boigny, constructed a basilica in his dusty little home-town of Yamoussoukro, to the cost of US$ 145 million (officially; unofficially about twice as much). This Basilique Notre Dame de la Paix is indicative for the amounts of funds possible to amass through embezzlement in a poor country. The costs for this gilded replica of St. Peter’s cathedral in Rome were covered by the president “privately”. However, investigations have concluded that this much money can only have been raised

35

through the systematic and institutionalised embezzlement of the “Caisse de stabilisation”, the state marketing board for the Ivorian coffe- and cocoa export. This marketing board enjoyed a monopoly situation for many years and siphoned off between 20 and 80% of the revenues (Toulabor 1990). It is a sort of embezzlement also when power-holders use their political office systematically to enter into, secure and expand their private business interests. In some cases the political elite has for instance nationalised foreign businesses and property rights, and redistributed this to the members of the ruling families. In the name of “privatisation”, a large number of former state enterprises and parastatals have been handed over to friends and family of ministers and presidents, for symbolic sums of money. In Zimbabwe (ex-Rhodesia), ruling party bosses now mostly own the formerly white farms. In the Côte d’Ivoire, the largest coffee-and cocoa plantations are owned by the president’s family. In Cameroon and other African countries the biggest breweries, sugar refineries, and other companies are owned by the president and his family and enjoying monopoly rights. “Fraud” is a crime that involves some kind of trickery, swindle or deceit, and it is a broader legal and popular term that covers both bribery and embezzlement. It is fraud when for instance state agencies and state representatives are engaged in the black and grey (informal) markets, and when networks of forgery, trade in illegal goods and smuggling are propped up by “official” sanction and involvement. While serious fraud is generally treated as cases of individual enrichment, fraud can also be “collective”. Fraud is the swindle and deceit used by the ruling group to make more benefits for the rulers, and as such the concept includes what has been labeled extractive corruption.

36

Fraud was called “dirty tricks politics” by Bayart in the book The Criminalisation of the State in Africa (Bayart et.al. 1997). Here, the fraudulent, illegal and immoral ways of money extraction employed by African rulers and their backers are described in quite some detail. Dirty tricks politics include cases of governments “importing” toxic and atomic waste from Western countries (like the Central African Republic and Sierra Leone), cases of presidents who have printed large amounts of national bank notes to pay civil servants and military men (who have then forced these upon local traders, at gunpoint in the case of Zaïre), and state or parastatal institutions that have persuaded private firms to give them loans, assistance and services that will never be paid back (Cameroon, the Central African Republic and several others). Many private banks have consequently gone bankrupt or withdrawn from the African market, like BCCI and Banque Méridien. According to this book, members of the ruling elites in Nigeria and Kenya have been involved in the international drug trade, as ministers and top bureaucrats have been active in it or have taken a share for closing their eyes on it. Money laundering and money flight is from these and other countries passing through state banks and parastatals. Public agencies have been issuing falsified certificates of country of origin and of brand names, enabling faked goods from Taiwan and Hong Kong to reach the European and American markets. What is widespread and even increasing, according to Bayart, is the role of the African state as an active mediator, facilitator and partner in fraudulent and criminal business activities, in organised crime nationally and internationally (Bayart et.al. 1997). “Extortion” is money (or other resources) extracted by the use of coercion, violence or the threats to use force. “Protection” or “security” money is resources extorted in the classical, infamous mafia style. By creating an atmosphere of insecurity where individual citizens, private

37

businesses and public officials are harassed and intimidated (by the mafia itself), the mafia blackmails and extorts some money in return for their kind of peace. Only those who pay this protection money may be exempted from further harassment. Like bribery, blackmailing and extortion is basically a corrupt transaction, but the money is more violently extracted and the returns are meagre. The exchange of benefits is highly unequal because in return for millions in protection money, the blackmailed may get no more than a negative freedom, a lax promise of impunity. Corruption in the form of extortion is usually understood as a form of “redistributive” extraction, “from below”. It is for instance when real mafias, like in Russia and Italy, are able to impose their influence upon individual state officials and entire state agencies through threats and intimidation and ultimately by assassinations. What they obtain in return may be preferential business opportunities and privileges, and freedom from taxation, regulations, and legal prosecution. However, corrupt practices of this kind can also be “from above”, when the state itself is the biggest mafia of them all. This is known for instance where the state, and in particular its security services and paramilitary groups, extorts money from individuals and groups to protect them from further harassment. One extreme situation of this was Mobutu’s Zaïre, as described by Mel McNulty: “The state’s only apparent function was the systematic exploitation of its people and resources, while it offered nothing in return, not even security; instead, the state itself and its agents were the principal sources of insecurity” (McNulty 1999). With more or less concealed threats, the rulers from private sector businesses also extract resources. When exaggeratedly strict taxation, overtly delayed licenses, repeated and brutal police inspections or other harassment are to be expected, private sector businesses rarely take the chance of refusing state or ruling party officials what they demand. Presidential re-election

38

campaigns are for instance recurrently “irrigated” by private companies. When the ruling party of Côte d’Ivoire held its national convention in 1997, party bosses also used the major hotel in the capital city Abidjan without paying a cent, catering services were given free of charge, and the city’s recently privatised bus company placed all the city’s buses to the service of the party convention. This was “upon request” and against massive protests from the public. Also the extortion made by military and police units in their many roadblocks can be understood as extractive corruption. Over most of Africa, from Tunisia in the north to South Africa, these roadblocks are widespread. Whenever you leave or enter a town, there is a checkpoint where men in uniform expect a little fee for making the passage smooth. In some cases, these checkpoints are used to restrict the movement of dissenters, but usually it is tolerated by governments as a source of income for underpaid divisions, a sort of taxation of local travellers. “Favouritism” is a mechanism of power abuse implying “privatisation” and a highly biased distribution of state resources, no matter how these resources have been accumulated in the first place. Favouritism or cronyism is to grant offices or benefits to friends and relatives, regardless of merit. Favouritism is related to corruption insofar as it means power abuse in the form of a corrupted (undemocratic, “privatised”) distribution of resources, whereas corruption strictly defined is about the accumulation of resources. However, favouritism in the distribution of resources is intimately related to corruption, in particular the collective and extractive corruption of neopatrimonial regimes as discussed above. Favouritism is quite simply the normal human proclivity to favour friends, family and anybody close and trusted. In the political sphere, favouritism is the penchant of state officials and politicians, who have access to state resources and the power to decide upon the distribution of these, to give preferential treatment to certain people when distributing resources. Clientelist

39

favouritism is a basic characteristic of the neo-patrimonial societies, but in most societies it is a rather everyday proclivity to favour one’s kinship members (family, clan, tribe, ethnic, religious or regional group). In most non-democratic systems, the president has for instance the constitutional right to appoint all high-ranking positions. This easily ads up to several hundred positions within the ministries, the military and security apparatus, in parastatals and public companies and agencies, in the diplomatic corps and in the ruling party. This legal or customary right, of course, extends the possibilities for (and intensifies) all kinds of favouritism, Nepotism is a special form of favouritism, in which an office holder (ruler) with the right to make appointments, prefers to nominate to prominent positions his proper kinfolk and family members (wife, brothers and sisters, children, nephews, cousins, in-laws etc.). Many unrestricted presidents have tried to secure their (precarious) power position by nominating family members to key political, economic and military/security positions in the state apparatus. (Mény 1996) When “successful”, deeply nepotist systems are getting closer to a “mafia” because of the shared family “values” and loyalties. Other kinds of favouritism is for instance when certain people are commissioned to buy privatised public property (cheaply), or given preferences, state guaranteed or subventioned loans, or selected as entrepreneurs for public works, nominated to represent corporate interests in various public councils and committees, and given other privileges through various economic policies. Through such mechanisms, many politicians and bureaucrats have been able to move from public position into private business, to transfer public power into private wealth11. The kind(s) of favouritism that will be preferred in each instance is dependent on the political and strategic needs of the day, and on cultural and social patterns. Favouritism is not only a legal and procedural problem, but also a problem of flawed qualifications, lacking skills and inefficiency.

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CHAPTER THREE 3.0

CORRUPTION WAR IN NIGERIA BEFORE PRESIDENT GOODLUCK EBELE JONATHAN

3.1

Corruption in Nigeria under President Olusegun Obasanjo (1999 – 2007) At independence in 1960, many Nigerians believed their country was destined for greatness on the world stage. Instead, more than 50 years on, the country largely remains a “crippled giant” (Abati 1998). The significant remark is that the power of incumbency makes it very difficult to expose the corrupt acts being perpetrated by an incumbent political leader; particularly in Nigeria were the provision in the 1999 constitution, specifically in its section 308, which inter alia provides for the immunity from prosecution. This fact becomes glaring when we appreciate that the call for amendment of the 1999 Constitution of the Federal Republic of Nigeria, especially and particularly the cited section has been so contentious that it has raised so much dust in the polity. This section according to those against it needs to be expunged or at least re-amended to go with the current reality of the kind of leaders we have in our society. More so, this becomes glaring when it is appreciated that if Abacha has been in office (and worst of all has not died), his corrupt scandal would not have been terribly exposed. Though his government pursued economic reforms that uphold transparency, public accountability and good governance; for example the establishment of Anti-corrupt agencies: Economic and Financial Crimes Commission (EFCC), and Independent Corrupt Practices Commission (ICPC). Yet, some attitudes of President Obasanjo, and some projects he embarked upon indicates that he is not free of corruption; though his power of incumbency and some provisions of Nigeria constitution affords him serious protection while in office. The fact that

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some holders of offices protected under the said section cunningly hide behind it to perpetrate crimes including those which attract criminal charges, make it the more reason why proponents of its amendment felt it has outlived its usefulness. Examples of serious ‘indications’ that suggest President Obasanjo as probably corrupt during his tenure was: The Library Launch at Abeokuta, Ogun State Nigeria that is the Obasanjo Presidential Library (OPL) project. It can be argued that in the said launching, Obasanjo used his position as President to extort billions of Naira from the masses. In an editorial on Monday 16 May 2005, The Guardian could not hide its disgust of his library launched in Ogun State. The library launch has been described elsewhere as executive extortion. What has happened is perhaps more serious than that. It can be described as constructive corruption where the construction is subtle, disarming and palpable negative…. Knowing the Nigerian mindset you cannot involve functionaries of government and its agencies and tell the world that all their donations are coming from their salaries and private enterprise. On his part, World Nobel Laureate in 1986, Professor Wole Soyinka, on May 16, 2005, at Ibadan, described the launch thus: “what happened in Abeokuta was an executive extortion and it is a contradiction to the campaign against corruption… it was transparent and open”. The fact that Obasanjo and even his deputy, Atiku Abubakar obtained licences to run private universities in Nigeria is questionable. The Code of Conduct Bureau was expected to explain (and should have explained) to the Nigerian masses the rationality in the then serving president embarking upon private projects while still in office. Besides, almost all the states governors during Obasanjo’s tenure were equally corrupt, particularly the 30 governors that supported Obasanjo’s third term in office bid.

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Joshua Dariye was arrested in London for alleged money laundering in 2004. He has been facing EFCCs inquisition and is still haunted by the fear of prosecution by the EFCC since the said controversial immunity expired. Dariye is among the 30 Governors that campaigned for Obasanjo- 3rd term in office. Good and weighty evidence is the case of Chief Joshua Chibi Dariye, the embattled governor of Plateau State, who was caught in London when he was absconding with states money. Like Dariye, the case of Alamieyeseigha, the Bayelsa state governor that was arrested for the same alleged money laundering is still on records. Most of these state governors are still facing the wrath of the EFCC since they left office. One major resultant effect of the indication of political corruption in Obasanjo’s government is the high level of poverty; the figure was above 70 percent when he left office in 2007 (FOS). Economic Commission for Africa (ECA) making recommendation for cancellation of Nigeria’s debt notes; “Over 70 percent of Nigerians live on less than $1 a day, 79,500 Nigerian children die before age 5 every month, less than 60 percent of Primary-aged children attend school…” And this high level of poverty during Obasanjo’s regime, led to protracted and intense conflicts (e.g. the Niger-Delta, Ijaw and Aguleri conflicts) and a rise in the level of crime (high way robbers, rise in vigilantism and the kidnapping of expatriates), which are constraints to development in all ramifications. Obasanjo in his speech even pronounced the failure of his government in addressing the problems of poverty, conflict and the rampant corruption in his administration. In his Independence Day speech on 1 October 2001, the president conceded that his administration had failed to lift Nigerians out of poverty, end violence, and solve other obstacles (such as crime and underdevelopment) that the country confronts. Also that “corruption remained rampant, despite the adoption of anti-corruption legislation in 2000, distorting

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economic management, corrupting law enforcement, and starving desperately needed public services”. Damn it my feet, ‘salaries and private money indeed! Was the N100 million donated by Governor `Gbenga Daniel of Ogun State taken from his personal salary, or was any provision made for that expenditure in the state’s budget? There is also the issue of N10 million donation (better put levy) by each state governor said to have been pledged on their behalf by Gov. Victor Attah of Akwa Ibom State, then Chair of the Governors’ Forum, and the vexatious donation of one million US dollars from the Nigerian Ports Authority, a very sick and dying government parastatal indebted to hapless contractors to the tune of billions of naira, to a project that has been described as a ‘totally private affair’. The NNPC had also written to oil companies to donate toward the project for which the seven major oil companies responded by donating $20 million (about N2.7 billion), the highest from the business community. Sources said since the NNPC and the oil companies were in joint venture, part of their contribution was government money. What about their unknown existing body ‘Obasanjo Holdings’ that donated N100 million. The question is who owns this money and when was it incorporated? Nigerians are aware of that Obasanjo ran a failed Farm in 1998, when he came out of prison. Some banks were compelled to donate. For complete detail see Ejinkonye’s piece, also Guardian Monday 16 May, 2005. Ugochukwu, 2007 online. Yes, the money is for the masses, because if investigation is carried out you will see that virtually all came from public coffers. Besides the Newspaper reports already cited; stronger evidence has emerged since the time Obasanjo left office. This should be a further ground for research, since the concentration of this paper is 1979 - 2007

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3.2

Cases of Corruption in Nigeria during President Musa Yar’Adua Corruption has turned what should be one of the countries strongest assets, its vast oil wealth into a curse. Rather than lead to concrete improvements in the lives of ordinary Nigerians, oil revenues have fuelled political violence, fraudulent elections, police abuses, and other human rights violations, even as living standards have slipped and key public institutions have collapsed. Former Economic and Financial Crimes Commission (EFCC) chairman Nuhu Ribadu has estimated that between independence and the end of military rule in 1999, more than US$380 billion was lost to graft and mismanagement. Endemic corruption has continued since then. Human Rights Watch has documented the role of corruption and mismanagement in depriving Nigerians of their basic human rights in several different contexts. This research showed how in Rivers State one of Nigeria’s wealthiest states and biggest oil producers embezzlement and mismanagement of public funds prevented tremendous resources from improving the dire state of basic health and education services during the administration of former president Olusegun Obasanjo. Human Rights Watch has also documented the role of corruption in fuelling the political violence and electoral fraud that have plagued Nigeria since the end of military rule. (Human Rights Watch). These twin problems have claimed hundreds of lives and produced government institutions that are often ineffective and largely unaccountable to the people who depend on them. For example, Human Rights Watch research shows how corruption has helped transform Nigeria’s national police force from protectors to predators. Widespread bribery and extortion by rank-and-file officers, and a system of “returns” in which bribes are passed up the chain of command, have fuelled abuses ranging from arbitrary arrests and unlawful detention to torture and extrajudicial killings.

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Bribery, embezzlement, and abuse of office by police officials have severely undermined access to justice for ordinary Nigerians and left the force with inadequate resources to carry out meaningful investigations (Everyone’s in on the Game). Corruption is at the heart of many of Nigeria’s most serious human rights problems and Human Rights Watch has repeatedly called upon the Nigerian government to do more to fight corruption and bolster the capacity and independence of key anti-corruption institutions. In December 2007, James Ibori was arrested, the powerful former governor of Delta State, in the oil-rich Niger Delta. Ibori had presided over a state that had remained impoverished and dysfunctional under his watch despite massive inflows of oil revenue. Although Ibori was not seen as a close ally of Obasanjo, many Nigerians assumed him to be untouchable because of his close relationship to both Yar’Adua whose campaign Ibori is widely believed to have financially backed and Yar’Adua’s attorney general, Michael Aondoakaa (The Attorney General’s War on the EFCC).The idea that a man as powerful as Ibori could sit in prison awaiting trial gave a momentary new surge of excitement and legitimacy to the EFCC’s anticorruption campaign But the already beleaguered Ribadu had overplayed his hand, and the move against Ibori sealed the end of his career at the EFCC. Less than two weeks after the EFCC charged Ibori, Ribadu was “temporarily” relieved of his post and sent to attend a ten-month training course at Nigeria’s National Institute for Policy and Strategic Studies. Ribadu’s tenure at the helm of the EFCC was in fact over, leaving him and many other EFCC officials apparently stunned. “We did not anticipate the reaction,” one key Ribadu era official told Human Rights Watch. “Either we did not read the mind of the president very well or we were naïve. Tafa Balogun was the EFCC’s first conviction of a nationally prominent political figure. Charged to court in April 2005, just months after being forced to retire as Nigeria’s inspector general of

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police, Balogun ultimately pleaded guilty of failing to declare his assets, and his front companies were convicted of eight counts of money laundering. In November 2005 he was sentenced to six months in prison and the court ordered the seizure of his assets reportedly worth in excess of $150 million (BBC News Online 2005). The sentence struck many as light given the severity of the allegations. He stood accused of financial crimes allegedly committed at a time when he was serving as Nigeria’s chief law enforcement officer (Davidson et al 2007). Nonetheless, Balogun’s conviction was a profoundly important moment the sight of such a prominent public official being hauled before a court in handcuffs to answer for corruption was something many Nigerians had thought impossible (Pindiga 2005). Balogun has since reportedly retired to a luxury home in a high – end Lagos neighbourhood. Diepreye Alamieyeseigha served as governor of Nigeria’s oil-rich but deeply impoverished Bayelsa State from 1999 to 2005. In September 2005, he was arrested by British authorities in London. The London Metropolitan Police found about £1 million in cash at his home and charged him with money laundering (BBC News Online 2005). Released on bail, Alamieyeseigha managed to flee the UK, the EFCC says disguised as a woman and reappeared in his home state, claiming he had been transported there by God (Lydia Polgreen 2005). As a sitting governor he enjoyed immunity from prosecution in Nigeria, but three months later he was impeached by his state legislature, and the EFCC charged him with embezzling about $55 million in public funds (Tume Ahemba 2005). In July 2007 the former governor pleaded guilty to failing to declare his assets, his front companies were convicted of money laundering, and the court ordered his assets seized. He was sentenced to two years in prison and released, for time served, the day after his sentencing (Mbachu 2007).

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Alamieyeseigha was quickly welcomed back into the ruling party fold. In May 2008 senior ruling party officials openly campaigned alongside Alamieyeseigha at a political rally in Bayelsa State, just 10 months after his conviction (Oyebode 2008). Former Edo State governor Lucky Igbinedion was charged by EFCC prosecutors in January 2008 with siphoning off more than $25 million of public funds. He ultimately pleaded guilty in December 2008 to failing to declare his assets and his front company was convicted on 27 counts of money laundering. But the trial judge in the case, Abdullahi Kafarati, deviated from the terms of the plea agreement and handed down a very light sentence that included no jail time. Igbinedion paid the equivalent of a $25,000 fine, agreed to forfeit some of his property, and walked free on the spot. The EFCC appealed the light sentence. In early 2011, the EFCC raided two of his palatial homes in Abuja and filed new criminal charges against the former governor. But in May 2011 the court dismissed the case, ruling that the new charges would amount to double jeopardy. (Ibileke 2011) Olabode (“Bode”) George was a powerful figure within the ruling party under President Obasanjo and was also chairman of the Nigerian Ports Authority (NPA) for a time. The EFCC in August 2008 charged him with contract-related offenses dating back to his time at the NPA. (Akintunde 2008) In October 2009 he was convicted and sentenced to two and a half years in prison after a surprisingly swift and efficient trial. This was the EFCC’s first and so far only conviction at trial of a major political figure an important accomplishment. The positive example of his conviction was diminished, however, when he was treated to a rapturous welcome by key ruling party figures upon his release from prison in February 2011. (BBC News Online, October 27, 2009).

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Following our conception of corruption, one would assert that Nigeria is corrupt. This can be accounted for by many and unabashed human behaviours in various sectors which do not fall in line with what ought to be. In the year 2000, Transparency International ranked Nigeria the world’s most corrupt country. Mamadu augments this when he states that corruption has become a way of life for most Nigerians (xi). And Dike declares that corruption is (endemic) in Nigeria … the leaders as well as the followers are corrupt (http://www.africanecnomicanalysis.org). All this clearly shows that corruption is a serious problem in Nigeria as a result of total moral breakdown in the character ethic of Nigerians. Hence, Fafowora of the Nation newspapers was led to ask a mind-bugging question “is it really possible now to eliminate, or reduce, public corruption in Nigeria”. There are many cases that can be cited to buttress this claim in the economic, political, bureaucratic and social dimensions, etc. Corruption has become a song. The over N100 billion Nigeria Ports Authority scam, masterminded by Bode George. There is also the huge scam in the petroleum sector with oil blocks being randomly allocated to the cronies of the PDP. Ambassador Sam Edem as Chairman of NDDC was alleged to have embezzled nearly N300 million. The incidents in the power sector are no longer news. That of the agriculture is still fresh where the 2007 budget for agriculture was diverted to take care of the luxuries of members of parliament. What of the electoral process? People like Mrs. Ahmadu Ali who won election she never contested just because her husband is the Party Chairman? What of contract awards? Most of which are never meant to be executed.

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But the high level of corruption is not limited to federal establishments. It is the same in the states and local governments. Nor is it limited to the executive branch alone. The National Assembly and even the Judiciary are deeply involved. According to Fafowroa, when the judiciary is perceived as being corrupt, then the entire system of justice breaks down completely (48). Yet when we look outside the government, we see an awful rate of corrupt practices. Traders sell fake and substandard goods to the unsuspecting consumer. Many Nigerians have taken vocation in internet frauds, 419 or advance fee fraud, contract scam and so on. Perhaps so outrageous and well-received is corruption in Nigerian that a popular artist Nkem Owoh released a musical album entitled “I go chop your dollar”. BBC Radio network demonstrated the high prevalence of corruption in Nigeria by playing the above song on its programme “Focus on Africa”, where it treated corruption as an issue (BBC, 26th August, 2008). Thus, we have shown with the above that Nigeria is corrupt. These must have inspired Ochulor to characterized Nigeria as a Machiavellian Society (317) he goes ahead to declare; "As a result of Nigeria’s current Machiavellian philosophy of wealth acquisition … most Nigerians today believe that moral uprightness and wealth acquisition are two parallel lines that can never meet. Consequently, those who want to be morally upright have given up the ambition of becoming wealthy, because they feel it is for the corrupt. And those who want to be wealthy have given up the possibility of moral uprightness, because they think it does not promote wealth" (317) therefore, the thesis that Nigerian is corrupt is a foregone conclusion. The long time reign of corruption has come to leave a mirror factor in the life of the nation, to the extent that what is true in reality can be made false in appearance and vice versa- the case of the erstwhile Governor of Delta State Chief James Ibori is a strong case in point: A one-time

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convict, turned out to be a non-convict, ironically from the same judiciary. But we do not want to belabour this work with this type of discussion. It is one thing to acknowledge that corruption is a bad practice and another to acknowledge that one is corrupt here Nigeria. Otherwise, most political leaders and civil servants will willingly resign their posts and offices and turn up for prosecution. But this will never happen because the corrupt man does not yet believe he is corrupt. He sees himself as exploiting his opportunities, taking his own share of the national cake and so on while corruption itself is a separate entity tormenting us all. Ochulor states; “The process of acquiring wealth in Nigeria has taken different dimensions as people now consider wealth not as a means but as an end (318). As an end therefore, it does not matter what one does and for how long. In short one can live a lifetime of corruption in so far as it makes him wealthy and powerful – it is acceptable by the society. He can never be the bad man. It is corruption who is the common enemy of all. This is very obvious from what happens daily in the Nigeria societies, where corrupt men are celebrated, regarded highly and often given chieftaincy titles and coveted national awards. As Dike Writes, “Nigeria’s reward system is perhaps the poorest in the world. Nigeria is a society where national priorities are turned upside down; hard work is not rewarded, but rogues are often glorified in Nigeria (http://www.africanecnomicanalysis.org). This entire societal madness clearly shows the double face of corruption in Nigeria. At one end people shout against corruption, pass bill in the National Assembly, establish anti-corruption commissions and campaigns, but at the other end however, the same people carry out on daily basis several acts of corruption, ranging from looting, embezzlement, favouritism, nepotism to contract scams etc. The cases of National Electricity Project, Ajaokuta steel project, roads, airports, and water projects are some very good examples. Many political leaders have been fingered some of whom

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are; Tony Anenih, Liyel Imoke, Bode George, Olusegun Agagu, Iyabo Obasanjo to mention just a few. What about the ousted speaker of the House of Assembly, Mrs. Patricia Etteh who brought international disgrace to Nigeria? What of ex-police IG’s Tafa Balogun and Sunday Ehinderoh whose corrupt acts are still reverberating. We cannot name them all! We saw late president Yara’dua boldly slapping the constitution severally. On one occasion he favoured Okiro instead of Onovo as the I.G of police; he ignored for a reasonable length of time the plight of the people of Niger Delta Region, he favoured the increment in the salaries of political office holders while grudging civil servants of same. In short before he became the president he declared his assets in hundreds of millions and we wish to ask; where did he get the money? He had been governor for some years, and his salaries and entitlements during the period were not up to 30 million. Before then, he had been a lecturer, and we all know what they lived on then; so where did he get the excesses? The point we want to establish here, is that basically every Nigerian is corrupt or atleast is exposed to various acts of corruption but ironically, would not admit it. And we all end up as depicted in an African proverb, chasing the ghost that eats up our children. Corruption which is portrayed as the common enemy of us all –it is a being – a monster but never one of us.

REFERENCES

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Allan Ball. (1987). Modern Politics and Governement: in Remi Anifowose and Francis Enemuo, Rep, Element of Politics Lagos: Sam Iroanusi Publication. Michael. G. Roskin et. (2008). Political Science: an introduction, Prentice hall: Pearson International Edition F. C. Enemuo (2005). “Approach and Method of the study of Politics” in Remi Anifowose and Francis Enemuo, Rep, Element of Politics Lagos: Sam Iroanusi Publication Human Rights Watch “2010” Everybody on the game: Corruption and Human Rights Abuses by the Nigeria Police Force August 2010 http://www.hrw.org/node/10442 Abati, Toke. (2009) Corruption, institutions, and economic development. Oxford Review of Economic Policy, 25 (2): 271-291. Ugochukwu

Ejinkonye,‘Is

Nigeria’s

Gen.

Obasanjo

An

Extortioner?

At

http://www.nathanielturner.com/isnigeriasgenobasanjoextortioner.htm (07/07/07). African Forum and Network on Debt and Development (2007). Nigeria: Foreign Debts, Stolen Wealth, IFIs and The West, A Case Study: AFRODAD. Ejinkonye

Ugochukwu

(2007).

Is

Nigeria’s

Gen.

Obasanjo

an

extortioner?

http://www.nathanieltumer.com/isnigeriasgenobasanjoextortioner.htm (027/02/07).

CHAPTER FOUR 56

At

4.0

OVERVIEW OF CORRUPTION “A CASE STUDY OF THE NIGERIA FOURTH REPUBLIC”

4.1

TRENDS OF DEVELOPMENT IN NIGERIA Corruption is a disease, which eats into the cultural, political and economic growth of any country and as well destroys the functioning of various organs of the government. Transparently international (2005) opine that “corruption is one of the greatest challenges of the contemporary world which undermines good government, fundamentally distorts public policy, leads to the misallocation of resources harms the private sector development and as well hurts the poor”. The need to study corruption and economic growth in Nigeria has continued to generate passionate commentaries and academic interest due to the level of corruption in the country and its effect on economic growth. In Nigeria corruption is one of the reasons for many unresolved problems that have critically hobbled and reduce development (Ayobolu, 2006). It also remains a long-term major political and economic growth challenge for Nigeria (Sachs, 2007). International Centre for economic growth (1999) states that corruption is a canker worm that has eaten deep in the fabric of the nation which ranges from petty corruption to political or systematic corruption. Abiodem (2007) in World Bank studies put corruption at over $1 trillion per year accounting for up to 15% of the Gross Domestic Product of nation like Nigeria. Corruption is a canker worm that has reduced development in all sectors of the economy (EFCC, 2005). Corruption has been the primary reason behind the country difficulties in developing fast (ICPC, 2006). Ribadu, (2003) states that this is the reason why transparency international has consisted rating of Nigeria as one of the top three most corrupt countries in the world. Corruption has been identified as one major obstacle militating against rapid growth and development of the Nigerian economy. Nigeria is blessed with abundant natural and human resources to the extent 57

that some of these natural resources have never been extracted or tapped by the government e.g gold, some natural resources are neglected by the government since the discovery of oil well, such as cocoa, timber, etc, while only crude oil is enjoying the biggest attention and has been the largest source of revenue to the government for over forty years. Since 1996 when Nigeria first featured in the Corruption Perception Index (CPI), a research carried out by Transparency International (TI), a Non Governmental Organisation (NGO) that assesses the level of corruption in countries around the world. Nigeria have always been languishing in the bottom of the ranking among countries evaluated and have more than once ranked as the most corrupt country in the world. Despite having the world’s seventh largest reserve of crude oil coupled with other resources in Nigeria, poverty and underdevelopment still ravage the country, this can be seen from all indexes of development over the years. The major reason advanced for this is the prevalence of corruption in governance, public and private places. Nigerian government officials are well known for their self – servicing style of governance. According to ICPC Act section 2, corruption includes vices like bribery, fraud and the other related offences. It also sees corruption as the abuse of power or position of trust for personal or group benefit (monetary or otherwise). According to World Bank (2000), corruption can be defined as “the abuse of public office for private gains”. By this connection, public office is being abused for private gain when an official accepts, solicits or extorts a bribe. It is equally abused when private agent actively offers bribes to circumvent public policies and processes for competitive advantage and profit. Besides, public office can also be abused for personal gain even if no bribery occurs but when there is patronage and nepotism as well as the theft of state assets and the diversion of state resources meant for an identified specific project. According to Justice Emmanuel Olayinka Ayoola, former Chairman of ICPC, “the commonest form of

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corruption in Nigeria used to be bribery but in recent years this has been overtaken in level of prevalence by embezzlement and theft from public funds, extortion, abuse of discretion, abuse of public power for private gain, favouritism and nepotism, conflict of interest, extortion and illegal political party financing”. The above definitions of corruption show that corruption goes beyond financial aspect. It includes moral, behaviour, electoral, disobedience and so on. Meanwhile, for the purpose of our discourse, our major focus will be on financial corruption which is very injurious to national development. 4.1.1

Financial Corruption: Financial corruption is essentially material, financial and economic. Financial corruption is traceable to some of the enumerated aspects of corruption like diversion, mismanagement and misappropriation of fund, embezzlement, theft from public funds, abuse of discretion and abuse of public power for extortion or bribe. According to Aluko (2008), the essence of financial corruption is bribery and illegal and greedy acquisition of public funds into private pockets, which otherwise would have been invested for the public good. The Corrupt Practices Decree of 1975, that described corruption by restricting it to bribery which means the offer, promise or receipt on any gratification as inducement or reward is a good example of financial corruption. In the pursuit of the efforts to reduce graft in the world, the Transparency International embarked on an annual grading of countries according to their degree of financial corruption, beginning from the most corrupt to the least corrupt. This was done by awarding marks out of ten marks to each of the considered countries, the lowest marks being awarded to the most corrupt and the highest marks awarded to the least corrupt (Aluko, 2008). Usually, huge amounts stolen from various sources of financial corruption, which cannot be legitimately explained as earnings, are siphoned and hidden across the borders to foreign banks especially in the developed countries, regarded as safe haven.

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4.1.2

Development: In the words of economists, development cannot and should not be mistaken for growth. This is because; the problem in Nigeria is that the word “development” has been couched in terms of material things rather than people. It should be such as conscious and careful exploitation of nature to satisfy human needs. It should not be seen as an item to be possessed like a new car but a sustained effort towards a clearly defined national goal (Raji, 1999). Seers (1969) sees development in terms of a reduction in three variables- poverty, unemployment and inequality. Seers definition was corroborated by Todaro (1977) when he says that: “Development must therefore be conceived of a multi-dimensional process involving changes in structures, attitudes and institutions as well as the acceleration of economic growth, the reduction of inequality and eradication of absolute poverty”. Hodder (2000) also sees development as an economic, social or political process which results in a cumulative rise in the perceived standard of living for an increasing proportion of a population”. This definition suggests that an increased standard of living involves a social and political process as well as an economic one. This improvement in the standard of living must be both cumulative and in the long duration rather than just temporary. Development which must be seen as an overall qualitative improvement in the lives of a people or a political community is expected to address the issues of social welfare, equity and justice. According to the UNDP, the central purpose of development should be the creation of an enabling and empowering environment in which all the individuals, including the poor and the vulnerable can enjoy healthy and creative lives (UNDP, 1997).

4.1.3

National Development: National development is the ability of a county or countries to improve the social welfare of the people such as providing social amenities like quality education, potable water, infrastructural facilities, medical care, and so on (Abimbola & Adesote, 2012). This means that national development must involve the aggregation of national resources of the country for

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the general well being of the citizenry in terms of their social and economic advancement (Abimbola & Adesote, 2012). Raji (1999) conceptualised national development in terms of progress in three major dimensions in the life of a nation. These dimensions are economic, political and social or moral. Balogun (1972) makes the concept of national development more vivid when he wrote that, national development entails producing more and better food to eat, healthier and happier individuals, better living accommodation, improved transportation and communications system, sound education and enlightenment among the populace, and generally, more money floating around. The above definitions of national development centre on people and their quality of lives in the society. This means that whatever kind of changes being witnessed in the various sectors of the society should have positive influence on the people. 4.2

FINANCIAL CORRUPTION IN THE FOURTH REPUBLIC Before we begin to discuss various cases of financial corrupt practices inherent since the birth of the fourth republic, it is imperative to briefly have a glimpse of various transitions that had taken place since the republic began. Meanwhile, under this section, we are not so much concern about the details of the political intrigues, deft manoeuvres and various electoral frauds and malpractices that not only propelled Chief Olusegun Obasanjo to power through the vehicle of the Peoples Democratic Party (PDP) in May, 1999 which marked the beginning of the Fourth Republic, but also other successive administrations up till 2011. One basic fact remains that power was eventually transferred after a virtually interminable military transition process that began with Gen Ibrahim to democratic governance in 1999. Gen. Abdulsalami Abubakar was said to have brought the transition to a logical conclusion. And, thus, since 1999 till 2011 there have been successful transitions from one civilian government to another, though occupied by the same political party (i.e PDP), such as (1999 to 2007); 2007 to 2011; and 2011 – 2014.

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One of the major challenges confronting the new democratic government since 1999 is endemic financial corruption in every arm of governance (executive, legislative and judiciary) in the country. In fact, considering various cases of financial corruption being perpetrated in governance since 1999 till date, one can easily conclude that financial corruption has actually been institutionalized in the country. This is noticeable in various ratings of the country since 1999 by Transparency International and others as either the most, second most or top ten most corrupt countries of the world. Various issues of financial corrupt practices in the country would be analysed under three major arms of government (executive, legislature and judiciary). It is important to emphasize here that in our discourse on the cases of corrupt practices in governance in the Nigeria’s fourth republic, attempt is not made to discuss all the corrupt practices that were being done. Attempt would be made to cite cases of some major corrupt practices perpetrated by political leaders at federal, state and local governments in the country. 4.3

FINANCIAL CORRUPTION IN THE EXECUTIVE ARM OF GOVERNMENT A number of financial corrupt practices were carried out in the executive arm of government in the country since 1999. This financial corruption was not limited to federal government alone. Both the state and local governments were equally guilty of corrupt practices. The perpetration of financial corruption at the executive arm of government involved embezzlement, mismanagement and misappropriation of fund, diversion of fund, award and inflation of contracts, and so on. For example, at the state government level, a number of ex-governors who ruled between 1999 and 2007 were alleged by EFCC for financial impropriety when they were in government within those years. Among them are Lucky Igbinedion of Edo State, Ayo Fayose of Ekiti State, Peter Odili of Rivers State, Chimaroke Nnamani of Enugu State, Saminu Turaki of Jigawa State, Orji Uzor Kalu of Abia, James Ibori, Diepreye Alamieyeseigha of Bayelsa State

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and Rev. Jolly Nyame of Taraba State. For instance, James Ibori, was arraigned on a 170-count charge (Tell, 2012) of money laundering over N9.1 billion (Kofarmata, 2005); Orji Uzor Kalu of Abia was arraigned on a 191- count charge of money laundary, criminal diversion of public fund, official corruption of totalling #5.2 billion (Tell, 2012) and was also accused of using his loot of N3.1 billion to fund SLOK Airline and two banks in the Gambia and Sierra Leone, in addition to owning houses in London and the US (Kofarmata, 2005); Saminu Turaki of Jigawa State, who is now a serving senator, was accused of spending N36 million of public funds to acquire oil blocks from the Federal Government; Rev. Jolly Nyame of Taraba State was charged with stealing N1.6 billion belonging to the state; and Nnamani is standing trial for his alleged illegal diversion of public funds totalling N5.6 billion, alongside two of his former commissioners, Peter Mba and Sam Ejiofor and some companies linked to him; and Diepreye Alamieyeseigha was arrested on 40 counts of corruption and money laundering. In July 2006, British authorities returned about 1 million pounds (US$1.9 million) of the allegedly illicit gains that he stashed in British banks (Kofarmata, 2005). One important area where financial corruption was noticeable in the executive arm of government, with special reference to the federal government in particular was in the area of road infrastructure. Since the birth of the fourth republic, majority of federal roads across the six geo-political zones were awarded by different successive governments at huge amount, up till today none of these roads have been completed. For example, the report of the CBN on the survey of Highways in Nigeria revealed the total number of roads to be constructed throughout the six geo-political zones between 1999 and 2001 but was not constructed as a result of outright embezzlement. The report showed that less than 10% of the funding request made by the Federal Ministry of Works and Housing for road maintenance was appropriated. It reveals that despite

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the total funds released for road maintenance across the country between the year which were N509.29 million, N742.72 million and N779.84 million respectively, yet, most of the road in the Southern area and Northern zones were in very poor conditions. Some of the poor conditions of roads include; potholes, gullies, peel-offs, lack of gutters and so on. Among those notable roads are Owerri-Onitsha roads, Enugu-Onitsha road, Owerri-Umuahia road (all the south-east zone): Lagos-Ibadan road, Ibadan-Ife road, Benin-Lagos road and Ibadan-Ilorin road (all in the SouthWest); Kano-Kaduna road, Kastina-Funta road (all in North-West); Akwanga-Markurdi road, Ayungba-Markurdi road (all in the North Central); and Bauchi-Gombe road, Bauchi-Ningi, Bauchi-Tafa-Balewa-Langtang roads (all in the North-East) (CBN Report,2003). The above report of CBN could be corroborated with the words of the former Auditor-General of the Federation, Mr. Vincent Azie, which eventually led to its sack by Obasanjo administration. Mr. Vincent, as reported in the Thisday Newspaper of May 14, 2003 cited in Iyoha & Enabunene (2005) indicted the presidency and the National Assembly of corruption. He particularly indicted the presidency of expenditure that cannot be accounted for, paying for jobs not executed, outright stealing of over #23 million through over invoicing, double debiting, embezzlement and inflation of contract figures (Iyoha & Enabunene, 2005). Also, it was revealed that no fewer than 37 contracts awarded by the Federal Government for the construction and rehabilitation of roads between 2002 and 2010 awarded by the Federal Ministry of Works valued at N308.13bn were yet to be completed. The details of the contracts which are contained in a document titled “completed and substantially completed projects and projects awarded under Appropriation states that 11 road projects valued at N131.13bn were awarded between 2002 and 2009, while 26 projects with the total value of N176.6bn were awarded in 2010. Some of these projects include the N36.3bn Benin-Shagamu road project; N42.3bn

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expansion of the Abuja-Abaji road contract awarded to three different contractors since 2006; the N15bn contract for construction of the Kano Western Bypass awarded in May 2007; and the N30.85bn contract for its expansion into dual lanes of the Onitsha-Owerri expressway and Onitsha Eastern Bypass awarded in July 2002 (The Punch, Tuesday, August 2, 2011).

4.4

FINANCIAL CORRUPTION IN THE LEGISLATIVE ARM OF GOVERNMENT At this arm of government, majority of financial corruption being carried out deals with cases of bribery scandals which are being levelled against chairmen and members of probe panels of different special commissions set up within the legislative body to investigate reported cases of corruption committed in the country. It is very pathetic that some members of these committees who are expected to investigate cases of corrupt practices also ended up in becoming corrupt. In fact, there were several cases of this ugly incidence since the fourth republic began in the National Assembly. Both the Senate and House of Representatives were guilty of this scenario. In a bid to address cases of corrupt practices levelled against the National Electric Power Authority (NEPA), the House of Representatives set up a committee known as Ndudi Elumelu committee on Power probe in 2007. The committee started well by inviting both the former ministers of power and other officials of NEPA but up till today, the report of the committee was both disowned by some of the committee members and was drowned by counter-attacks. Besides, the chairman of the power probe, Hon. Ndudi Elumelu was alleged to have involved in corrupt practices during the hearing of the case. Another noticeable area where the Federal legislatures have equally involved in financial corruption is the recent allegations of bribery scandal levelled against the chairman of the House of Representatives, Ad Hoc committee on fuel subsidy regime probe and other members of the

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committee. Following the removal of subsidy on fuel in 1 st January, 2012 by the President, Dr. Jonathan which led to the increase in fuel price from #65 per litre to between #138 and #200 per litre across the country, the Nigerian Labour Congress, Trade Union Congress (TUC) and other associations and civil society embarked on strike which lasted for more than a week. The strike which was later called off by the NLC chairman after agreements had been reached with the presidency resulted in the partial removal of subsidy on fuel and the reduction of fuel to #97 per litre. The development that later followed was the investigation of how subsidy being paid on the importation of fuel into the country was implemented. This was what made the House of Representatives to constitute an Ad Hoc committee on fuel subsidy regime probe. The committee was constituted and Hon. Farouk Lawal, former chairman, House committee on Education was made the chairman of the committee. The committee also started well initially like that of power probe committee (The Punch, Monday 9, 2012). Having worked for some months, the committee was able to discover about 18 oil companies that were not registered but collected subsidy on fuel illegally from the federal government. It was in the process of listing the names of the oil companies that it became known that the chairman of the committee had been bribed with $3 million by one of the oil markers, so that the name of his company be removed from the list. In order to investigate the allegation of bribery scandal levelled against Hon. Farouk Lawal, House of Representatives Committee on Ethics and Privileges was set up. The chairman of Zenon Oil and Gas Limited, Mr Femi Otedola was invited by the committee and thus testified before the committee that a sum of #620,000 was given to Hon Farouk Lawal and the clerk of the committee, Mr. Boniface Emenalo, from agreed $ 3 million as part payment for the clearance deal (Nigerian Tribune, Friday 22 nd, June, 2012: 12). In another media report, it was said that Hon. Farouk Lawal gave the said amount to Hon. 66

Adams Jagaba, chairman of House of Representatives committee on Drugs, Narcotics and Financial Crimes. But Hon. Jagaba disproved the allegation levelled against him by Hon. Farouk (Saturday Tribune, 23rd June, 2012:.9). Up till now, Hon. Farouk has not been able to prove his innocence of the allegation. Besides the above discussed examples of financial corruption in the Lower House of National Assembly, evidences equally showed that there allegations of financial corruption against some senators in the Upper House of National Assembly between 1999 and 2007. For example, In July 2000, an investigative panel found evidence of inflated procurement contracts in the National Assembly, some awarded to companies in which legislators had a financial interest. High-level officials are implicated, including Senate President Chuba Okadigbo and Senate Deputy President Alhaji Haruna Abubakar. In August 2000, Okadigbo was impeached for corruption and misappropriation of funds. After his impeachment, Okadigbo was indicted for spending public money on cars and car furnishings and resigns in October. Also, in March 2005, Education Minister Fabian Osuji was fired for allegedly bribing the National Assembly to secure more funds for his ministry. He formally protested that such behavior is common at all levels of government. In April, Senate Speaker Adolphus Wabara resigned after President Obasanjo accused him of accepting Osuji's 51 million naira (US$400,000) bribe. In addition, the former president’s daughter, Senator Iyabo Obasanjo-Bello, Chairman, Senate Committee on Health was enmeshed in two different financial scandals. In December 2007, Iyabo Obasanjo-Bello, was involved in a contract scandal amounting to N3.5 billion involving her and an Austrian firm. According to the EFCC, the senator used her mother’s maiden name, Akinlawon to conceal her identity in the contract involving M.Schneider GMBH. She was also alleged of mismanaging a fund allotted to the Ministry of Health. The scandal led to the resignation of Mrs. Adenike 67

Grange and her deputy, Gabriel Aduku. After a series of interrogation, she was eventually arraigned in court over N300 million unspent budget scam the EFCC (Pogoson, 2009). 4.5

FINANCIAL CORRUPTION AND NATIONAL DEVELOPMENT IN NIGERIA’S FOURTH REPUBLIC: A DISCOURSE There is a correlation between financial corruption and national development in Nigeria. The essence of financial corruption is bribery and illegal and greedy acquisition of public funds into private pockets, which otherwise would have been invested for the public good. Financial corruption undermines democracy and the legitimate of the state, reduces the potential for economic growth, and threatens the freedom and security of citizens, all together constitutes hindrances to national development. The high rate of financial corruption in Nigeria has affected her image in Africa and the world. Since the birth of the fourth republic, the country has variously been rated by Transparency International (TI) as among the most corrupt nations of the world on one hand; and by another international organisation like Fund for Peace as one of the top failed states in both Africa and the world on the other hand due to mass poverty, corruption, insecurity and unemployment. In its 2001 report on worldwide corrupt practices, Transparency International (T.I), considered Nigeria to be the most corrupt, country, falling from the fifth position in 1998 to the first position, in 2001. In the 2003 corruption indices of 93 of the 193 member countries of the world, 191 of which are members of the United Nations (excluding Taiwan and the Vatican City – The Holy See). Nigeria became the second most corrupt, country after Bangladesh, even though Nigeria’s score fell from 1.9, in 1998, to 1.4, in 2003. Several of the countries x-rayed in 1998 were not ex-rayed in 2003. No country scored 10 marks in 2003, the highest score, Finland, being 9.7, indicating that every one of the 93 countries, including Denmark that was most clean in 1998

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with 10 marks, had a degree of corruption. In 2004, T. I survey covered 146 countries. In that report, Nigeria was rated the third most corrupt country, beating Haiti and Bangladesh to the second and last positions respectively. (T.I. Report 2004). In the 2006 rating on the T.I Corruption Perception Index, Nigeria moved to the eleventh (11th) position out of 50 selected countries (Aluko, 2008) Despite reduction in the rating of Nigeria from most corrupt in 2001 to the 11 th position in 2006 of which could be as a result of the few activities of EFCC and ICPC between those periods, the rate of increase in the per capita incomes and human development indices was very low and very small. The reason behind this was that the rate of corruption was still high. This was noticeable her corruption perception index scoring 2.2. It would be very difficult for countries whose perception index was below 5 to increase their per capita incomes. For example, most of the countries that have more than 5 corruption perception index in 2006 Botswana (5.6), Barbados (6.7), Denmark (9.5), Sweden (9.2), Finland (9.6), among others increased their per capita incomes between 1998 and 2006 by over 50 per cent, in spite of their initial high incomes in 1998. These countries equally have the least incidence of corruption and the highest human development indices, because they provide elaborate welfare facilities for their citizens from the cradle to the grave. Their respective governments constitute the engine of growth of their economies. They do not role back their governments as is the vogue in Nigeria. They do not privatise public utilities and properties, nor do they enrich private people at the expense of their citizens, and, income differentials among persons are reducing from time to time in order to ensure national economic harmony (Aluko, 2008). Corruption undermines the legitimacy of the state. It is the lack of legitimacy that creates fertile soil for corruption to grow. It is a known fact that when the citizens of a state see how financial

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corrupt practices continue to engulf every arm of governance, they are tended to lose faith in that government, and thus conclude that such a government is incapable of working for the interests of the majority of citizens. This could be corroborated by the submission of Eigen (2002). He says that when this happens, the citizens have at least three choices to make. First, they could force the resignation of the corrupt officials. For example, in 2002, protesters demanded the resignation of President Estrada of the Philippines on allegation of corrupt practices when they discovered that the legislature failed to act on evidence of his corruption (Eigen, 2002). Second, they could find alternate avenues to gain the access needed to government such as creating an underground economy. Third, they could accept the costs associated with a corrupt judiciary. For example, citizens in Guatemala are discouraged from using the legal system because of the ease with which criminals are able to benefit from the corruption (Scott and Welna, 2003). Therefore, if the chosen avenue becomes too much of a threat to the government it will become politically unstable. Economically, financial corruption hinders economic development both internally and externally. It is a major paralysis on the economy. Internally, corruption prevents competition and causes the government to operate inefficiently. Externally, corruption inhibits foreign direct investment both by diverting aid into corrupt hands and increasing the costs of doing business in the country (Thurow, 2003). It is very pathetic when a certain Australian national who came to Nigeria for a particular project was prevailed upon by his Nigerian principals who were then in government to inflate a contract by an increase of a sum of N5.5bn. He however portrays Nigerians as a people who hold down the horns of our parents’ cow for others to milk (Ekwueru & Daminabo, 2008). Corruption not only contributes immensely to the problem of mass poverty and but have rendered millions of Nigerian youth unemployed. The poverty profile of Nigerians has continued

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to worsen year by year. For example, the UNDP Development Report 2001 places Nigeria at no 148 out of 173 countries surveyed. The situation worsened in 2003 report, which put Nigeria at 152 among the 175 countries covered. The Fund for Peace in 2012 report for the year 2011 ranked Nigeria as one of the top 10 failed states in Africa and the 14th in the world. The computation of the 2011 ranking of about 178 countries in the world as revealed by this international organization involves a lot of factors which are issues of poverty aggravation, security, economic development, public services and so on. Meanwhile, in the 2011 report for the year 2010 data, Nigeria was ranked 8 th considering heightened level of insecurity, corruption, growing poverty and unemployment (The Punch, July, 2012). The report of this international organisation can be corroborated with nation’s reports on the level of poverty in the country. According to Federal Republic of Nigeria- Niger Delta Regional Development Master Plan, 2008, about 70% of Nigerians are living below the poverty level. Also, Dr. Yemi Kale, Statistician General of the Federation at a Press Conference in Abuja on the high rate of poverty in the country as at December, 2011, he said that, North West and North East geo-political zones recorded the highest poverty rate in Nigeria with 77.7% and 76.3% respectively, South-South and South-East with 60%, while the South West recorded the least percentage with 50% (Nigerian Tribune, Tuesday 14th February, 2012). More importantly, corruption undermines democracy. It is a major factor responsible for the failure of governance, democratic values, rule of law and the prevalence of poor leadership. This view was supported by the former President of Nigeria, Chief Olusegun Obasanjo. He succinctly put it in a speech at the Public Procurement Bill Workshop (Abuja, July 12 2004) that “evidently, a corrupt economic arrangement can never produce a political system that is stable, just, inclusive, and democratic.’. According to Eigen (2002), corruption circumvents the workings of 71

democracy in three ways. First, many acts of corruption undermine human rights by fostering discrimination; second, it undermines political and civil rights, such as free speech and fair elections, which are important to the development and perpetuation of a democracy; and third, democracy is more likely to be successful in a wealthy country. He asserts that corruption is more likely to occur in underdeveloped countries. Aluko (2008) supported this view by saying that where incomes are less unequally distributed (developed nations) the incidence of corruption is lower than where there is a high degree of inequality in income distribution (underdeveloped nations). Thus, more socialist and more welfarist economies tend to be less corrupt than capitalist or market-oriented, individualistic economies like Nigeria. It therefore follows that corruption will make it harder for a country like Nigeria to sustain her democracy.

REFERENCES Abimbola, J.O and Adesote, S.A. (2012) Good Governance and National Development in Nigeria: A Critical Analysis. In D.A Falade and Gbade Ikuejube (eds), Nation Building and Sustainable Development in Nigeria (pp. 23-33). Ibadan, Alafas Nigeria Company.

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Adegbamigbe, A., “On a Rescue Mission” The News 31:21, 01 December 2008, available at: ,

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August,21, 2012 Adelekan, A.K. (2012) Corruption and the Challenge of Good Governance and Development in Nigeria. In Proceedings of National Conference on Social-Political Conflicts and Challenges of Democratic Consolidation in Nigeria (pp.20-23 Adeyemi College of Education, Ondo. Adeniyi S. (2006). Wolfowitz: Nigeria Has Lost $300billion to Corruption, This Day, 11 (4196)17: 3. Akinbi, J.O (1999) Political Leadership and Nation Building in Nigeria: The Historical Perspective. In J.O Akinbi (ed) Towards A Better Nigeria: Reflections on Contemporary Issues in the Socio-Political and Economic Development of Nigeria, (pp.1-14). Ibadan, Ben Quality Prints. Akinola, G.A (2009) Leadership and the Postcolonial Nigeria Predicament. Monograph Series No.1.Department of History, University of Ibadan. Aluko, S.A (2008) Corruption and National Development: A Lecture delivered at the Centre for Democratic Development Research and Training, Zaria as part of the Activities of Professor Bala Usman Annual Memorial Lecture, on Saturday 31st May. Awolope, W (2004, June) Corruption free Nigeria: An Impossible Vision. Glamour, 13 (2), 1215. Awolowo, O (1979). Africa. London, Oxford University Press. Ayoola, Emmanuel O (2005) Corruption in Nigeria: the way forward”, A Paper delivered at the 50th Anniversary of Ilesha Grammar School, Dec. 17th 73

Balogun, T.A (1972) The role of Science and Technology in national development”. In A. Adarelegbe (ed) A Philosophy of Nigerian Education,(pp.12-20. Ibadan, Heinemann Educational Books (Nigeria) Limited. Central Bank of Nigeria Report, 2003 Dike V (nd), “Corruption in Nigeria: A New Paradigm for Effective http://www.africaneconomicanalysis.org/articles/gen/corruptiondike

Control”

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htm.html. Eigen, P (2002) Corruption in a Globalized World. SAIS Review 22, 45-59. Ekwueme, E.G. and Daminabo, A.F.D (2008) Corruption in Education: The Nigerian experience”. Journal of Vocational Science and Educational Development. 8 (1), 109-11 Falola, T, A Mahadi, M Uhomoibhi & U Anyanwu (1991) History of Nigeria 3: Nigeria in the twentieth century (pp. 23-40). Ibadan: Longman Group Limited. Federal Republic of Nigeria. The Corrupt Practices and Other Related Offences Act, 2000 Hodder, R.(2000). Development Geography (pp.12-14). London: Routledge International Commission of Jurists, Attacks on Justice: Federal Republic of Nigeria, available at: . HRW. ‚Chop Fine.‛ (2007). www.hrw.org/doc/?t=africa_pub&c=nigeria. HRW. ‚Criminal Politics: Violence, ‘Godfathers’ and Corruption in Nigeria,‛ Vol. 19, No. 16 (2007a). Iyoha, F.E and Enabunene, S. (2005) Corruption and Crime in Nigeria: Impact on National Development. In O Arowolo and S. I Fabarebo (eds) Nigeria: Contemporary Issues, (pp.59-67).Ondo: Don Bosco Training Centre. Kofarmata, D.A. State Governors and Nigeria’s Anti Corruption War, Herndon (USA), 2005. Available at http://www.dawodu.com/kofarmata2.htm. (last accessed August 12, 2012).

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Langseth, P and Michael, B. (2003) Foreign-Sponsored Development Projects in Africa: The Dialogue between International and African Judicial Integrity Projects. Journal of Sustainable Development in Africa 4 (3) 23-32 Newspapers & Magazines Corruption in road contract awards in Nigeria. (2011, August 2). The Punch, pp.12-13 Abacha loots Nigerian money (2006, May 5). Tell, pp. 27-29 High rate of corrupt Practices in Nigeria (2012) Tell, pp.21-28 The Fuel Subsidy saga (2012, June 9) The Punch, pp.1-2 Lawan collected #620,000 (2012, June 22) Nigerian Tribune, pp.1-2 Supreme Court sacked Kebbi’s Governor (2012, February 25) Saturday Tribune, p.1 Between Salami and Aloysius (2012, March 4) Sunday Tribune, pp.3-4 Professor Talla. Re: Nigeria: One of the Tope Failed State (2012, July 12) The Punch, p.10 The Truth about Salami’s case (2012, July 11) The Nigerian Triune, pp.2-3 Poverty in Nigeria (2012, February 14) Nigerian Tribune, pp1-2 Nye, J.S. ‚Corruption and Political Development: A cost-Benefit analysis.‛ In Political Corruption: Readings in Comparative Analysis, ed. A. J. Heidenheimer (New Brunswick, NJ: Transaction Books, 1978): 564–78. Omotoso, K. (1988) Just Before Dawn. (pp. 26-29). Ibadan: Spectrum. Pogoson, A.I (2009) Globalization and Anti-Corruption Reform in Nigeria: 2003-2007”.In D.U, Enweremadu and E.E, Okafor (eds) Anti-Corruption Reform in Nigeria since 1999: Issues, challenges and the way forward, Ibadan: IFRA Special Research Issue vol. 3. Raji, S.M (1999) The Role of Yoruba Language in National Development in Nigeria. In J.O Akinbi, (ed) Towards A Better Nigeria: Reflections on Contemporary Issues in the

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Socio-Political and Economic Development of Nigeria (pp.201-210). Ibadan: Ben Quality Prints. Ribadu N (2006), “Corruption: the Trouble with Nigeria” http://www.gamji. com/articl 5000/NEWS 5530.htm Ribadu, N (2006) Corruption: The Trouble with Nigeria”, A paper presented at the 3rd Annual National Trust Dialogue, January 19. Ribadu, Nuhu (2006) Economic and Financial Crime Commission (EFCC). A presentation to United State Congressional House Committee on International Development, Washington, DC on 18 May. Ribadu, Nuhu. ‚Impact of Corruption on Youth Life in Country.‛ 17 October (2007a). www.allafrica.com/stories/printable/200710170297.html October 17. Scott, M and Welna, C (eds) (2003). Democratic Accountability in Latin America. (pp.20-24). New York: Oxford University Press. Seers, D (1969). The meaning of development Eleventh World conference of the Society for International Development (pp.10-12). New Delhi. Suberu, R.T (1990) Federalism and Political Instability: A Nigerian case study, 1979-1983. A Ph.D Thesis. Department of Political Science, University of Ibadan, Nigeria. Tadro, M.P (1977) Economics for a Developing World (pp.43-49). London: Longman Group Limited. The Concise Oxford English Dictionary (Wordsworth Reference) Thurow, L.(2003) Fortune Favours the Bold (pp.21-22) New York: HarperCollins Publishers, Inc. Tignor, R. (1993) Political Corruption in Nigeria before Independence. Journal Modern African Studies 12(10), 175 – 202.

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http://www.gwdg.de/~uwvw/. Transparency International. Corruption Perception Index. Retrieved December 2003. http://www.transparency.org/pressreleases_archive/2003/2003.10.07.cpi.en.html Ugochukwu, B (2004) Nigeria: Tribunals and the 2003 Elections.(pp.27-38). Lagos, Legal Defence Centre. United Nation Development Programme Report, 1997 Ugochukwu, B (2009) Democracy by Court Order: An Analytical Evaluation of the 2007 Election Petition Tribunals in Nigeria (pp.18-24). Lagos, Legal Defence Centre.

CHAPTER FIVE 5.0

SUMMARY, CONCLUSION AND RECOMMENDATION

5.1

Summary Corruption in Nigeria is institutional problems, and to address the problem an institutional approach is needed. To curb and eventually eradicate corruption among children, youth and adults, who must be given the power to distinguish right from wrong? All institutional sectors (education, civil servant, government parastrastal) should return to the teaching of moral education to empower children with the spirit of stewardship, while adults live exemplary lives, reflecting truth, kindness, dignity of labour, and integrity. In order to prevent corruption from happening at all, Nigerian should emphasis transparency, integrity, and accountability in all their

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private and public transaction. There Achanism Model is named for Achan who appears in the Old Testament of the Bible. Achan in the scripture was avaricious (Joshua 7). He was caught and his entire family was severely dealt with. His children, who might have expected to inherit the proceeds of his illegal act, were not allowed to do so. The solution is as follows: Social Transformation. Rransformation in education of the public is a necessary factor in social transformation. There is need for formation and reformation, orientation and re-orientation of the minds and heart of Nigerians, for them to see that corruption is the enemy of development. Enforcement of Anti-Corruption Law: - The law should be enforced to its fullest and without fear and favour. Improvement of Socio-political and Economic Life: - This is another weapon against corruption in Nigeria. The multiplying effects of this improvement will reduce the tendency of public servants to demand and take bribes and get involved in other corrupt practices.

5.2

CONCLUSION Democracy provides the foundation upon which a prosperous society can be built. If the foundation is crisis-ridden, the entire superstructure is bound to collapse and this will undermine growth. Studies have shown that developed economic institutions, including the rule of law, cordial coexistence among tiers of government, protection of property, checks against corruption, democratic accountability and peaceful political transition positively enhance improved economic performance and prosperity and where this is not present, the reverse is the case. In spite of attempts to check rampant corruption in public office, efforts are surreptitiously being made by some vested interests to thwart such efforts. In essence, what should be the best way of eradicating the menace of corruption so as to have a sustainable democracy in Nigeria?

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When corruption becomes systematically institutional, fighting it must go beyond implementing liberal economic policies, enacting better laws, reducing the number and complexity of regulations and providing more training, helpful though these steps may be. Fighting systematic corruption require administering a shock to disturb a corrupt equilibrium. It might include such steps as the following: formation of a national coordinating body thai is responsible for devising and following up on a strategy against corruption, along with a citizen's oversight board; identification of a few key agencies or areas on which the anti-corruption effort might focus its efforts, in the hope of achieving some momentum-building successes. A capacity building strategy within key ministries that takes the problems of incentives (including incentive reforms and information seriously; and identification of a few major offenders whose cases will be prosecuted). Combating corruption should focus on the reform of systems. It requires an economic approach, coupled with great political sensitivity. Corruption is a symptom of fundamental economic, political and institutional causes. Addressing corruption effectively means tackling these underlying causes. The major emphasis must be put on prevention-thai is, on reforming economic policies, institutions and incentives. Efforts to improve enforcement of anti-corruption legislation using the police, ethnic offices, or special watch dog agencies within government will not bear fruit otherwise. Also corruption is a human behaviour which stands opposed to what is right or what ought to be. We have looked at its nature and characteristics, considered it from both Biblical and ethical perspectives where we reached the following resolutions: that the Old Testament did not fully uphold its stand against corruption; that the New Testament fully stands against corrupt practices; and that corruption is opposed to uprightness, virtue and steadfastness and is therefore ethically

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condemnable. However, in doing all this, an ample room was allowed for a proper philosophical assessment of each position we came across, as a way of reaching a balanced resolution Thus, the following are only some of the major economic policy changes that will unambiguously reduce opportunities for corruption: lowering tariffs and other barriers to international trade:- unifying market- determined exchange rates and interest rates; eliminating enterprise subsidies; minimizing regulations, licensing requirements, and other barriers to entry for new firms and investors; demonopolizing and privatizing government assets; and transparently enforcing prudential banking regulations and auditing and accounting standards. The reform of government institutions may include civil service reform; improved budgeting, financial management and tax administration and strengthened legal and judicial systems. Such reforms should involve changing government structures and procedures; placing greater focus on internal and external checks and balances. As a complement to these broader reforms, the careful and transparent implementation of enforcement measures, such as prosecuting some prominent corrupt figures, can also have an impact. 5.3

RECOMMENDATION The anti-corruption war in Nigeria and particularly EFCC as an institution responsible for fighting the war, have to be align with the current realities, because public morals may loosen, and the battle against corruption may well be lost if Nigeria’s anti-corruption war is continue to be affected by controversies which are political in nature and EFCC continue to stick to its current style of prosecuting it mission- The situation where EFCC slammed 120 count charges on a person accused of being corrupt while in public office, and none of the charges can be established, should be replace with an approach that is multifaceted, multidisciplinary and knowledge-driven; an approach that would assist all institutions of government in re-establishing

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norms and standards of governance, assists the public, NGOs and even the legislature in monitoring of compliance with the standards; help in restoring social order especially in politics; and promotes advocacies and capacity building among genuine whistleblowers, in short, Nigeria’s anti-corruption war should not only be limited to arrests, arraignment of accused in courts of law and unnecessary controversies. EFCC should explore the inter-nations technical cooperation on corruption, to develop mechanism that would help Nigeria have a system that discourages outright stealing of public fund, and develop an anti-corruption war that relied on forensic evidence, well-trained personnel and free of unnecessary controversies. EFFC should, this time-around, effectively utilize the provisions in the National Assembly Act 2004, establishing it. For instance, Part III, section 12, subsection 1(c) and subsection (2), which provided for establishment of Research Unit; and any committee to assist the commission, are good avenues for the commission to explore to bring itself at par with Nigerians expectations. However, the best weapon the new helmsman of EFFC have, is, adherence to rule of law, because with the current uncompromising stand on adherence to Rule of Law, by President Yar’Adua, any disregard of Rule of Law will not only send one to kuru, it may send one to Kirikiri. Hope is very essential, in life we will surely continue to live in hope, even when we die in despair. Barrack Obama talks of the audacity of hope so it will not be out of place to say that there is hope of finding a way out of corruption for Nigeria; the rebranding project therefore, becomes critical. Here we want to acknowledge that corruption is a vice and to purge a vice, virtue is needed. Since moral depravity is what engenders corrupt practices, it follows therefore, that an elevated moral life will quell participation in corruption. A morally sanitized individual will be less vulnerable to the courtship of corrupt companies. Also, a man of virtue as Socrates,

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Plato and Aristotle believe is a man of the mean (Aristotle, 410). This means that extreme qualities as greed, covetousness and avarice will not be part of his nature. In this manner he is less likely to be troubled or worried by his lack of abundance. He is most likely to be content with what ever he has. The virtues of hard work, dignity, integrity and honour should also be taught both at school and at religious gatherings. And the nation should ban all forms of recognition, award, and titles for men with questionable integrity. When all these are implemented and a veritable way of honouring people with outstanding achievements that are ethically sound put in place; this orientation and culture of corruption will die a natural death, as no one will want to be a social outcast. So there is hope and there will continue to be hope. It was Napoleon Hill in his forerunning book Think and Grow Rich who opined that people tend to shrink from crime on their first contact with it. But that through the passage of time, as it sticks with them, they end up embracing it and living by it (169). Similarly, Nigeria has acquired many negative values which have come to replace the good ones effectively overtime. To this day, most socio-cultural, political and economic evil originating from Africa bear Nigeria Trade Mark. Some of these negative values include ritual killing. Many now engage in all sorts of rituals, with human body parts, blood etc., to acquire wealth. Others engage in all sorts of shoddy, obscene and occult practices for the same reason. Ochulor declares that “To many Nigerians, the only thing that matter is money or wealth; any how you get it is no body’s business” (320). Also, many have taken vocation in dirty and inhumane activities like prostitution, armed robbery, hired assassination and justice perversion. Many prostitutes and judges have been known to defend what they do on the ground that it was

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where they make their living. And many of them indeed end up acquiring enormous wealth and big connections. These need to be portrayed in a negative light so as to deter culprits. Furthermore, the values of adulteration, faking goods, substandard products and even piracy are currently, giving means of livelihood to no fewer than 30 million Nigerians. This results on daily basis to many Nigerians developing deadly diseases as cancer, liver and kidney problems from the consumption of these products and fake drugs. We may not have a source for our claim here but when we calculate the billions of naira worth of fake, substandard, pirated and adulterated products which NAFDAC and the copyright commission destroy every now and then in many markets, locations and sites across the nation and add it up to over ten times the number of those that are either not discovered or offered bribes to officials, then we know that 30 million might be a low figure after all. Again, we cannot forget that practices such as favouritism, nepotism, blackmail, bribery, contract scams, fraud, looting, rigging, embezzlement, forgery, impersonation etc., are also some other vices which have taken root of acceptance in Nigeria. In order therefore that we may get rid of corruption which is the mother of them all we must have to purge them away by finding ways of replacing them with positive values. In the last section, we have established that corruption is a vice and that to stop a vice, virtue is needed. From this premise, we want to find out those moral virtues that are currently lacking within the Nigerian system and discover a way of injecting them back into the system with a view to purging the country of corrupt practices. In the first place Ochulor advocates some values which this chapter believes will be very helpful especially in changing the intrinsic qualities and behavioural patterns of Nigerians so as to enable them give up the Machiavellian philosophy of wealth acquisition. He defends this thesis by

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saying; “… in the face of the corrupt nature of the Nigerian society, there is still the possibility of acquiring morally upright wealth in Nigeria (326). He went ahead to name the formula as follows; self knowledge: here one undergoes a critical examination of his life in order to give it focus and direction. Developing the mind: here, one seeks to develop the positive powers of his mind which is the engine room of human development. Others include specialization and education which give one an edge and qualification. Also, being at alert to notice opportunities when they come; being diligent and persistence, knowing of course that nothing good comes easy; and finally, imbibing to the full, the noble qualities of self discipline, positive attitude and good communication skill. Also, we know of course that Nigerians currently do not see morality as having any space within the socio-political and economic life-wire of the nation. Ochulor testifies to this when he said this about corruption, “it has affected many Nigerians so adversely that they now think of morality as a concept that cannot be found in business, politics, religion and socio-cultural relationships (318). Therefore, we want to maintain that morality should be restored to its rightful place within the nation’s life system, through campaigns, speeches and programmes. The government should encourage non-governmental organizations to spring up and re-culture Nigerians in this area. Also, we know that Nigerians currently see politics as a way of making quick money from the government treasury. Iwara and Effiong in their Essay, “Corruption and National Development in Nigeria: the Way Forward”, gave an almost endless list of political office holders involved in different lootings, embezzlements and scam (165). Thus, we have to make politics less glamorous in order to curtail this.

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Secondly, programmes should be developed aimed at making Nigerians patriotic at all level – this will make Nigerians put the nation first in everything they do. Thirdly, Nigerians should be taught the virtue of altruism from childhood. This will drastically reduce self-centeredness that encourages individual participation in corrupt acts. Fourthly, a broad-based re-orientation should be carried out to sensitize Nigerians on the danger, the short term and the long term negative impacts of corruption both in the life of the country, the individual and the posterity at large. Fifthly, there is a need for a public motivated revolution aimed at dismantling the stronghold and every citadel of corruption in Nigeria such that took place in China, France, Cuba to mention just a few. Sixthly, radical changes or what Kuhn calls paradigm shift should be encouraged and enforced in all the sectors of the nation’s life. This will demolish all the ugly cultures and practices wherever they thrive and introduce a breath of fresh air in all our systems The seventh and the eightieth virtues to be considered here are reform-based. Serious reforms are to be made in the education, judicial and the economic sectors. This will target at bringing an end to favouritism, nepotism, bribery, sell of sub-standard and fake goods, indiscriminate escalation of prices of goods, etc., in doing this, stringent legislative measures should be put in place with appropriate ways of implementation to check any arbitrariness and Lopsidedness. Finally and most importantly, there should be renewed interest and emphases for culture re-call. The lost African values which got eroded in the wake of western modernization should be brought back and instilled in Nigerians so that in their dealings and interactions they will never get wind of the idea of morality. This will be a strong back-bone for the nation as it seeks recovery from the dearth of corruption.

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Therefore, in injecting these virtues into the Nigeria system, it is hoped that this vice, corruption, will be stamped out of the nation or at least ameliorated. For where there is no corruption, there, justice thrives. Justice in the society as Plato advocates may yet return to Nigeria when the individual, the family and different strata of the Nigerian society play their parts in cultural reorientation and rebranding programmes as promoted by the ministry of information and public orientation in Nigeria.

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