CHAPTER ONE
INTRODUCTION
1.1 Background of the Study It is a well known fact by practitioners and scholars that local government is a viable tool for rural transformation and delivery of social service to the people. Whether unitary or federal political system; the strategic importance of local government to the development process is not in doubt. However, this is contingent in the relationship that exists among levels or tiers of government (Enefiok and Ekpe, 2014). According to Karingi (2003), globally, federalizing necessitates the combination of self and shared rule. It accommodate multi-level government that authorizes autonomous political units to perform its peculiar functions within a political saturation. Despite the imitating of formal decentralization policies, unsuitable intergovernmental relations can engender these relationship between central and local government. In Nigeria, local government by constitutional provision stands as a district level vis-à-vis federal and state government. Enefiok and Ekpe (2014) posit that the concept of intergovernmental relations took the centre stage at a period when there were numerous and complex problem facing three levels of government. They argued that the concept has its beginning in Nigeria around 1950s with the establishment of advisory body on intergovernmental relations. This was necessary because of numerous and complex problem confronting three levels of government in our heterogeneous society. This interrelationship becomes necessary for the achievement of national integration for a harmonious co-existence of the parts, as well as the whole for sold governance and meaningful development. However, six patterns of relationship in Nigeria intergovernmental relationship in Nigeria intergovernmental relations as identified by Enefiok and Ekpe (2014) are: Federal-state relations, Federal-state local relations, Federal-local relations, Inter-state relations, State-local relations and Inter-local relations. According to Teidi (2003), the fiscal arrangement among the different tiers of government in a federal structure is often referred to as fiscal federalism or intergovernmental fiscal relations. One major feature of this is Fiscal decentralization – the devolution of taxing and spending powers to lower levels of government, which has become an important theme of governance in many developing countries in recent years. Accordingly, restructuring of government has entered the core of the Development debate (Fjeldstad, 2001). According to Angahar (2013), one of the essential ingredients of federalism is the existence of a financial arrangement, which details tax jurisdiction and the functional responsibilities among the various levels of government (Teidi, 2003). The financial relationship among the different tiers of government in a federal structure is often referred to as intergovernmental fiscal relations (Nchuchuwe & Adejuwon, 2015). A key issue in intergovernmental fiscal relations is the assignment of functions and finances to different levels of government. Nigeria operates a third-tier federal system, which presupposes that the three tiers must relate vertically and horizontally for the good government of the country. In a federal system like Nigeria, local governments are close to the people and hence could efficiently alter grassroots development within their jurisdictions (Ekpo & Ndebbio, 1998). Nigeria’s model of fiscal federalism represents a fundamental legal and institutional framework for policymaking in the country. As in other federations, it defines the core rules for resource allocation, distribution of responsibilities for services delivery, and mechanisms for interaction between different tiers of government. Nigeria’s fiscal federalism arrangements are currently attracting increasing attention from both policymakers and analysts. This is a reflection of the fact that longer term perspectives of economic policy reform in the country are critically dependent upon improvements in the organization of intergovernmental arrangements. Such arrangement shaves direct implications for achieving national growth and poverty reduction targets. Simply put, there is a major need to strengthen the incentives of government agencies at all levels of authority to improve cooperation in designing of their policies of services. At the same times, capacity will have to be built to support such future intergovernmental cooperation (Angahar, 2013). The need for stronger cooperation and other reforms in driven by the fact the Nigerian constitution, stipulates that main public sector responsibilities are split across various government levels. Thus, no sole government could deliver radial improvements in service delivery on its own, which means that coordination and cooperation are pre-requisites. However, the existing mechanisms and institutions for inter-governmental policy coordination are weak and need strengthening. Closely related to weak policy coordination is the issue of acrimony between the tiers of government with regards to sharing resources among the three tiers of government.