6 CONCLUSION: DFID'S FUTURE
124. The size and diversity of Nigeria and the
scale of the challenges it faces makes it a very difficult country
for DFID to operate in. As Dr Mustapha told us:
I think it is a difficult and complex situation
but it is a job that needs to be done, both in the interests of
Nigerians and, let it be said, in the interests of the British
public as well. Should the country unravel the whole of West Africa
is gone and the consequences will ripple right across the globe.
It is an engagement that is necessary and not always easy but
I think needs to be done.
The enormity of the need in Nigeria is clear: northern
Nigeria has the worst human development indicators of any region
in the world outside conflict and post-conflict areas.
Gareth Thomas was clear that the "dominant factor"
behind DFID's continued engagement in Nigeria was the need to
make progress on the MDGs: "just the huge numbers of poor
people who need assistance in Nigeria itself".
125. However, a number of the people whom we met
during our visit emphasised the need to be realistic about what
could be achieved by donors, particularly given that aid represents
only 1% of GDP. It was evident to us that DFID's work is having
an impact, albeit on a small-scale and in a limited number of
States. Where success can be demonstrated, there is potential
for it to be replicated and scaled up by both the Federal Government
and the more effective State governments, who are now showing
greater capacity to do this. Nevertheless, change is likely to
be incremental and slow so long as the lack of Nigerian leadership
126. There are positive signs. The Federal Government
has achieved macroeconomic stabilisation through fixing a benchmark
price for oil and saving the excess revenue rather than spending
it, avoiding the boom-bust cycles of previous regimes. The huge
debt relief package agreed for the country in 2005 has freed up
resources to spend on progress towards the Millennium Development
Goals, which should bring desperately needed improvements to basic
services such as education and health care. Nigeria's non-oil
average growth rate increased to 8.1% between 2002 and 2007, up
from 3.5% in 1997-2000 (although DFID estimates that this growth
rate needs to average 15% between 2010 and 2015 to achieve the
first MDG on poverty reduction).
127. The global economic crisis, and in particular
its impact on oil prices, threatens this progress. Nigeria has
to find ways to make its economy less dependent on oil, to encourage
a vibrant and diverse private sector, and to create meaningful
employment for its large numbers of young people, particularly
young men who may otherwise be tempted into criminality and violence.
The assistance DFID and the World Bank plan to offer in this area
through the Growth and Employment in States programme will be
128. It is vital that Nigeria's oil wealth is used
systematically to fund the country's development. We believe that
it is right for donors to provide aid to Nigeria at the relatively
low level of 1% of GDP to encourage reform, but it would not be
sensible to raise the volume of aid to that received by other
poor African countries while corruption and poor governance remain
such significant barriers to poverty alleviation.
129. The obstacles to development, particularly weak
governance, corruption and lack of capacity in management of public
finances and delivery of services, make it doubly important that
DFID ensures that its funding is not misused or wasted. The Minister
told us that "our concerns about the effectiveness of government
and the government systems" affect the way DFID operates
Its written evidence elaborates: "DFID has designed
its programme with a view to protecting aid funds from corruption.
No DFID money is spent through Government of Nigeria systems.
All programmes are tightly monitored and audit processes are in
also recognise the potential risk to their programmes which corruption
presents and avoid direct transfers of funding.
130. DFID's programme in Nigeria is its fourth
largest in Africa and its allocation for 2009-10 is £120
million. This is a significant amount of money and we would find
it difficult to support this level of funding were it not for
the high level of poverty, and the country's size and strategic
importance. These factors have persuaded us that, despite the
challenges and the inevitably slow progress, DFID should maintain
its commitment to Nigeria. The numbers of poor people and the
appalling lack of progress on the Millennium Development Goals,
particularly those on maternal and child mortality and on gender
equality, mean that global development targets will only be met
if there is significant progress in Africa's most populous country.
A healthy realism about what is achievable should be combined
with a continued emphasis in DFID's programme on building the
capacity of the Nigerian authorities to deliver the services they
are responsible for out of their own resources. The Federal and
State Governments should be encouraged to learn from successful
projects, to replicate them and to disseminate good practice as
widely as possible.
131. The scale of the UK's contribution and the
weaknesses in Nigeria's systems demand that DFID take the greatest
care to ensure that maximum benefit is derived from its funding
in terms of improving the lives of Nigerian people. It should
have robust mechanisms in place which enable it clearly to demonstrate,
to the Nigerian people, to UK taxpayers and to Parliament, that
funding is not misused, diverted or wasted as a result of deficiencies
in Nigeria's own structures. DFID should also continue to work
with its donor partners to apply sustained pressure on the Federal
and State Governments to address these deficiencies and to focus
their efforts on effective delivery of services and a fair, transparent
and accountable use of oil wealth.
249 Q 17 Back
Ev 88 Back
Q 174 Back
Country Partnership Strategy 2009-13, para 1.1; see also Ev 54 Back
Q 158 Back
Ev 60 Back
Q 55 Back