Politics of Amending the Land Use Act

Executive Briefing

In rejecting the proposal to expunge the Land Use Act from the constitution, the National Assembly may have succumbed to pressure from state governors who do not want their powers over land whittled down, writes Davidson Iriekpen

Like previous attempts, another effort to delete the Land Use Act from the 1999 Constitution suffered another setback in the Senate and the House of Representatives last week when the proposal was rejected.

The Act is seen as one of the biggest impediments to converting land resources into individual wealth in the country as it hinders transferability of ownership rights in landed property without government interference.

Many are of the views that making the Act easy for amendments will lead to alteration that will eventually revolutionise accessibility to one of the world’s valued resources. The hope is that the legislature would change the way land is administered and owned across the country with analysts saying it will boost the development of the mortgage industry and commercial agriculture.

The Land Use Act was promulgated as Land Use Decree in 1978 by the then military government under General Olusegun Obasanjo. In a bid to retain the law in the statute books even after he had left office, the Obasanjo-led Supreme Military Council (SMC) made the Land Use Decree an integral part of the Constitution which he handed over to the Alhaji Shehu Shagari-led federal government. At that time, some land owners were holding the government to ransom by refusing to give up thier land for development. In making the law, government replaced one tyrant with another.

Since then, subsequent constitutions particularly the 1989 and the current 1999 Constitutions have the law duly recognised.

The Act vested all land in each state (except land vested in the federal government or its agencies) solely in the governor of the state, who would hold such land in trust for the people and be responsible for allocation of land in all urban areas to individuals resident in the state and to organisations for residential, agriculture, commercial and other purposes, while similar powers with respect to non urban areas are conferred on local governments.

Before the Act, control over land was vested in families, clans, villages and communities in Southern Nigeria. Under the traditional or customary agrarian land tenure system, individuals did not have complete control over the land and the sale of land was hardly possible. Individual occupants of land were identified by the right they hold rather than by actual possession of land.

In Northern Nigeria, the ownership and control of land was vested in the state government under the Land Tenure Law of 1962. However, the methods of agricultural organisation and production were similar to the system prevailing in the south.

But the Act was to abolish all these as it vested all lands in a state in the governor and in the hands of a few people who are well connected with government, while depriving the small-scale farmers of land; causing delays in securing Certificate of Occupancy (C of O) from government. Lofty as its intentions were, however, it was a matter of time before the Act became a piece of dysfunctional legislation. Certain obstacles, probably not foreseen by formulators of the law, invariably cropped up during its implementation.

These obstacles, including tenureship complexities, limited access to land by federal and local governments as well as foreigners, non-implementation of land ceiling, insecurity of certificate of occupancy, inhibiting consent provisions, high cost of land transactions and non-enforcement of development permission, are the kernel of sections 5, 7, 15, 21, 22, 23, and 28 of the Act that are slated for review.

Under the Act, the overwhelming powers granted the governors over land have been blamed for the country’s seemingly insurmountable housing problems. Most of the time, C-of-O which confers ownership of land on individuals are given to the highest bidder instead of those that actually need the land. In some states, obtaining a certificate of occupancy has become a herculean. Some state governments have even given and cancelled certificates of occupancy on flimsy excuses.

Many analysts believe that most of the state governors in whose care the “people’s land” is entrusted by this Act have demonstrably failed to make the land easily accessible to the people for their “use and common benefit.” Instead, people in government have merely upstaged the local land speculators and assumed that same pernicious role as most governors and officials in charge of land dispensary have suddenly become multiple landowners by virtue of their offices.

They have argued that the Act also concentrates too much power in the hands of state governors, who often exploit this for economic and political reasons to the detriment of other stakeholders, including even the federal and local governments as well as individuals who might require lands for industrial and agricultural developments. Sections 21 and 22 of the Act prescribe the requirement of a governor’s consent for the alienation of customary and statutory rights of occupancy, the procurement of which is however characterised by long and frustrating delay. For this reason, most holders of right of occupancy evade the consent provisions, leading to multiplicity of imperfect titles.

Over time, the Act has remained a sore point in Nigerians quest to acquire land for development. This is because development experts see it as one of the biggest impediments to development.

Recently, Nigeria was ranked 185th out of 185 countries assessed by the World Bank on the difficulty of registering properties. This is a major impediment to business transactions, which adversely affects all sectors of the economy. The general effect of all this is that “land” which should be an asset or capital for economic development has not played that role in Nigeria as lack of title and rigidity in the land market had left most of the vast land of Nigeria as dead capital, contrary to what obtains in developed countries.

It is for this reason that there has been a clamour for the Act to be amended. At every constitutional conference or constitution review debate, the clamour for the deletion of the Act from the constitution often generated heated debate. At the end, the proposals would be rejected.

Even the late President Umaru Musa Yar’Adua whose seven-point agenda included land reforms and home ownership, in 2009 attempted to amend the Act when he dispatched an executive bill to the National Assembly to that effect. But due to his lingering illness and his eventual death, the bill suffered one of the well-known administrative deficiency in the country – lack of continuity.

Many analysts see the rejection of the proposal as a major blow to economic reforms and wealth creation in the country. Checks by THISDAY revealed that the the proposal for the deletion of the Act from the constitution was rejected because of the high powered lobby and influence by most governors who are known to be highly opposed to its removal because land allocation is now one of the biggest revenue earners for many states and also provides a platform for governors and public officers to corner choice land for themselves and their cronies. It was gathered that the governors mandated their various houses of assembly to reject the deletion of the Act from the constitution.

“The Land Use Act creates uncertainty around property ownership and rights. We have seen situations where governors just wake up and revoke land allocations just because they do not like the person or because they have other interests. That creates significant uncertainty on land as a store of long term value in Nigeria. Also the fact that any time you transfer land, you need the consent of the governor makes the process cumbersome and reduces the bankability of land,” said a legal analyst.

A former president of the Nigerian Institution of Estate Surveyors and Valuers, Mr. Emeka Eleh, feels that the lawmakers rejected the proposal owing largely to a lack of understanding of what the benefits were.

Eleh argued that the removal of the Act from the constitution would not only make the processes for its implementation easier, but business friendly. He further identified other drawbacks of the inclusion of the Act to include difficulty in accessing land which has been a key hindrance to economic development. Also listed are wide spread controversies over ownership rights, low level of land rights’ infrastructure resulting to only about three per cent of land mass having legal title and lack of fluidity in land market arising from the requirement of governor’s consent for all transfer transactions.

Justifying why they want the Act expunged from the constitution and placed on the concurrent list, Eleh said: “It is for the reasons earlier stated that there has been a clamour since 1978 when the Act was promulgated for its amendment and every effort in this regard has failed including the one made by the late Yar’Adua through an executive bill sent to the National Assembly.”

For real estate developers, Land Use Act is a clog in the wheel of their progress and Adetokunbo Ajayi, Chief Executive Officer, Propertygate Development and Investment Company explained that it could kill business opportunity. He pointed out that the inability of the National Assembly to review the Act would affect a major factor of production, which is land, thereby slowing major economic development in the country.

“As a developer, when you acquire land for development, you need to register it in order to obtain the title. But you cannot get title for the land without first getting governor’s consent, which takes a long time to get. You also need land title in order to have access to capital and you cannot get this access if you don’t have the title,” he said in a telephone interview.

MKO Balogun, CEO, Global Property and Facilities International, agrees, saying it really slows development activities and rate of turnover.

“But this is government policy instrument aimed to regulate land use and checkmate land grabbers. So, despite its drawback in slowing business, it is a worthwhile government instrument,” he said.

Quote

The Act is seen as one of the biggest impediments to converting land resources into individual wealth in the country as it hinders transferability of ownership rights in landed property without government interference.