Professor Olumide Victor Ekanade, a Professor of Economic and Social History at Redeemer’s University, Ede, has warned that Nigeria’s current fiscal structure is weakening states and undermining national development, as the country increasingly departs from the principles of true federalism.
Speaking at the 21st inaugural lecture of Redeemer’s University, Ede, yesterday, the economic historian said Nigeria now operates a system he described as “fiscal centralism,” where sub-national governments are heavily dependent on the centre for survival.
Delivering a lecture titled “From Fiscal Federalism to Feeding Bottle Federalism: The Historical Dialectics of Nigeria’s Federal Finance and Its Accoutrements,” Ekanade argued that the country has abandoned the foundational ideals of fiscal federalism, where federating units exercise autonomy over revenue generation and expenditure.
He noted that although Nigeria retains a federal structure on paper, developments since the collapse of the First Republic have steadily eroded that framework, leaving states financially constrained and structurally dependent on federal allocations.
“What we operate today is fiscal centralism,” he said, stressing that the concentration of fiscal powers at the centre has created an “unsustainable system” that limits economic productivity and weakens governance at the state level.
Ekanade attributed this shift largely to the legacy of military rule, which, he said, institutionalised centralised control over national resources and governance. According to him, this legacy continues to shape Nigeria’s political and economic systems, even under democratic rule.
He warned that the over-centralisation of revenue and expenditure responsibilities has fuelled distribution-based politics, encouraged dependency, and deepened socio-political tensions across the country.
The professor further argued that the current fiscal arrangement prioritises allocation over productivity, leading to competition among states for federal resources rather than fostering internally generated revenue and economic innovation.
“Prioritised distribution and patronage politics over development and economic viability, generating horizontal distributive conflicts that often assume ethnic and class dimensions and threaten the cohesion of the Nigerian state,” he noted.
“Nigeria, by contrast, has “concentrated fiscal power at the centre, a trend he traced largely to decades of military rule”, He said.
“What we operate today is fiscal centralism,” Ekanade said, noting that states have become “financially weakened and structurally dependent on the centre
Drawing comparisons with established federations such as Canada, India and Australia, he noted that these countries maintain stronger fiscal autonomy for their sub-national governments, enabling balanced development and accountability.
Ekanade also criticised post-independence leaders for failing to build on earlier fiscal frameworks, including colonial-era commissions which, despite their limitations, reflected a more structured approach to managing diversity and resource distribution.
He warned that the persistence of the current system could continue to generate economic inefficiencies, deepen inequality, and threaten national cohesion if not urgently addressed.
Ekanade called for far-reaching reforms to restore fiscal balance, strengthen state capacity, and promote equitable development across the federation.
The Vice-Chancellor of the university, Professor Shadrach Olufemi Akindele, described the inaugural lecture as a key academic tradition that highlights scholarly contributions and stimulates critical discourse on national issues.
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