Abuja — Centre for Social Studies and Development (CSSD), weekend, called for the overhaul of benefits transfer mechanisms for oil-producing communities to address the neglect suffered by the region.
In a report presented at a webinar on Precept 5 of the Nigerian Natural Resource Charter (NNRC), Executive Director of the CSSD, also called ‘We The People’, Mr. Ken Henshaw, identified the systems of benefits transfer to oil-producing communities to include the Niger Delta Development Commission, NDDC; Ministry of Niger Delta; the 13 per cent Derivation Fund and Ecological Fund, among others.
According to Henshaw, the existing systems of benefits transfer to oil-producing communities had failed to address the exploitation, degradation and deprivation suffered by the communities.
Precept 5 of the NNRC, deals with managing local impact and states that the government should pursue opportunities for local benefits and account for, mitigate, and offset the environmental and social costs of resource extraction projects.
However, according to Henshaw, in the area of local benefits, the government superintended systems of benefits transfer to communities, including the NDDC and Ministry of Niger Delta, the 13% derivation fund, and ecological funds, have failed to ensure that communities adequately benefit from natural resource earnings.
Specifically, he noted that monitoring the utilization of the 13 per cent Derivation was very difficult because the money is paid directly into the accounts of the various state governments.
He also faulted the implementation of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, stating that while Nigeria’s local content requirements hold great promises for greater benefit transfers to oil-producing communities, its actual application in the oil and gas sector was weak.
However, he applauded the Global Memorandum of Understanding, GMoU, structures created by oil companies with the participation of the communities, explaining that while the systems promoted by the government had failed, in contrast, the GMoUs were fast becoming the most effective routes for benefit transfers and participation in oil-producing communities.
“Unfortunately, the fact that the agreements are non-binding in many instances, and their implementation discretionary, is a significant weakness,” he noted.
Henshaw added that during the preparation of the report, the CSSD found that there were are no deliberate and enforceable frameworks created by any tier of government with the goal of ensuring that affected communities participate meaningfully in decision making on resource projects.
This, he said, was a clear negation of the precept, which requires that there be meaningful participation of everyone, managing the expectation of the affected communities and avenue for grievance and dispute resolution.
However, to address these lags, Henshaw called for the overhaul of the benefits transfer mechanisms, such as the NDDC and 13% Derivation Fund; strengthening of monitoring agencies like the National Oil Spill Detection Agency (NOSDRA), to do their work effectively; and mainstreaming critical issues in the GMOUs and ensuring that they are put into law.
Henshaw also advocated the passage of a decent Petroleum Industry Bill (PIB) that addresses the concerns of citizens; ensuring benefit sharing mechanisms translate to tangible benefits for people in the region; implementation of the National Petroleum Policy; and engendering trust by ensuring meaningful participation in extractive resource projects, among others.