THE FINANCES OF NIGERIA
On June 30, 1899, a Treasury Minute informed the Royal Niger Company of
the intention of her Majesty’s Government to revoke their charter. At the
end of 1899 Sir Frederick Lugard proceeded to Africa to take over the
Niger Company’s territories in the name of Great Britain. On January 1,
1900, Crown Colony Administration was established in the Niger Company’s
territories, following its similar establishment in the Delta, which had
taken place some years previously.[70] In February 1902 the Government
condescended for the first time—in the face of public pressure—to
publish a report by Sir Frederick Lugard, _dated London, May 1, 1901_.
The report, which is very interesting, but in many respects incomplete,
notably as regards finance, only brings us down to March 31, 1901, so
that, although we are now well on in the third year of Crown Colony
Administration in Northern Nigeria, this single report is the measure of
the confidence which the Government sees fit to repose in the British
people, concerning the direct responsibilities they have acquired over
some twenty-five million natives of Africa.
There are several reasons why the public should not rest content with
such meagre information. The first reason is financial. The expenditure
of the two Protectorates—Northern and Southern Nigeria—is assuming very
large proportions, a heavy load of debt weighs over them, and not only
is there not the slightest sign of an effort to wipe off that debt, but
almost every month that passes sees an extension of liabilities. The
present condition of our national finances does not justify a continued
attitude of indifference towards the expenditure of public funds on an
increasing scale in Nigeria. On the other hand, our main object in West
Africa being what it is, viz. commercial in nature, there is extreme
unwisdom, from the ordinary business point of view, in neglecting to
ascertain how the largest and most important of our estates in West
Africa is being managed, and if the outlay is giving now, or is likely
to give in an appreciably near future, those returns which the public is
justified in expecting.
What, then, are the facts as to the financial situation of Northern and
Southern Nigeria? In the first place, there is the debt of £865,000
incurred by the Government in buying out the Niger Company. This debt is,
while it exists, a bar to progress, and at a Conference held in London
on September 20, 1900, we find Sir Ralph Moor, Commissioner for Southern
Nigeria, admitting the fact. When a speaker at that Conference urged that
more should be spent on technical education in the Protectorate, and
that the necessary amount might be paid out of the surplus revenue, Sir
Ralph Moor quickly retorted that they had no surplus revenue, but were
“in the unenviable position of owing her Majesty’s Treasury £800,000.” So
much for the debt, and the obstacle to desirable improvements which its
existence entails.[71]
The debt notwithstanding, the administrative expenditure of Southern
Nigeria steadily increases. In the year 1899-1900[72] it reached the
figure of £176,128,[73] being an increase of £29,383 over the preceding
year, and exceeded the revenue by £12,000. No figures are yet available
of the expenditure of Northern Nigeria since the substitution of the
Crown for the Niger Company in the _rôle_ of Administrator, but a
reference to the estimates of March 31, 1902, shows that Northern Nigeria
received a grant-in-aid of £88,800 in 1900-01, and another of £280,000 in
1901-02, which includes the provision of £200,000 for the West African
Frontier Force voted in 1900-01. We are, therefore, confronted with
a minimum expenditure for Northern Nigeria in two years of £368,800.
At this rate it is difficult to see how Nigeria is ever to become
self-supporting. Such an enormous expenditure could only be warranted by
an extraordinary development in trade, or by the creation of means of
communication for that development, to be looked upon in the light of
expenditure on capital account. It is all very well to call it “Imperial
expenditure.” Of course it is “Imperial” expenditure, and so is every
penny spent in the furtherance of British trade abroad “Imperial.” What
we have to try and form an opinion upon is whether the administrative
expenses of Nigeria are in any way proportionate to the interests which
the Administration is supposed to be promoting there. If it is, well and
good; if it is not, reform is required.
The relation of the expenditure to the trade of Nigeria is comparatively
easy to establish. The total trade (excluding specie) of the Niger Coast
Protectorate in 1898-99 amounted to £1,477,398, and the total trade of
Nigeria—that is, the Niger Coast Protectorate plus the territories of the
Niger Company—in 1900 (excluding specie) was £2,113,878. If we deduct,
therefore, the one set of figures from the other we can arrive at a close
approximation of the trade done in the former Niger Company’s territories
included since 1900 in the Protectorate of Nigeria. The trade of the
Niger Company’s territories in 1901 was, therefore, roughly £650,000, of
which it is quite safe to assume that Northern Nigeria did not produce
more than one-third, if it produced that, the bulk of the trade being
confined to the Niger Company’s territories in the Lower River. The
trade of Northern Nigeria would thus be represented by some £216,660
out of the total of £650,000. Assuming, for the sake of argument, that
it rose in 1901 to £250,000, the total for the two years 1900 and 1901
would be £466,660. Now Northern Nigeria, as already stated, received
for the same period £368,800 from the Imperial Exchequer. Pursuing the
same method of illustration for the export trade as for total trade,
the export trade of the Niger Company’s territories works out at some
£360,000, of which, say, one-third from Northern Nigeria, or £120,000.
Putting it down at £140,000 in 1901 gives a total of Northern Nigeria’s
export trade, or, in other words, Northern Nigeria’s producing capacity
for the two years mentioned of £260,000, so that Northern Nigeria is in
the disastrous financial situation of spending more than it produces. The
one-third basis of calculation is a large and generous one, and Northern
Nigeria’s share of responsibility in the debt is not included in the
reckoning. The position then, so far as Northern Nigeria is concerned,
is unmistakably clear. Northern Nigeria is at present a financial burden
to the Empire. Eight years’ experience of Crown Colony Administration in
the Niger Delta, where the machinery set up is not nearly so elaborate
as in Northern Nigeria and where the natural exploitable riches are far
greater, is hardly calculated to cause feelings of confidence as to what
eight years of a similar system will lead to in Northern Nigeria. In the
three years ending December 1899 the Niger Delta (excluding therefrom the
Niger Company’s territories) produced a trade which averaged in value
£1,800,000, of which over £1,000,000[74] represented exports. Under
the Crown Colony system, with its expensive machinery necessitating
taxation to keep up, its military expenditure, and the absence of all
commercial co-operation in the Administration, the value of exports has
only once (1893-94) managed to rise above £1,000,000, while with that one
exception the highest and lowest figures have been £844,333 and £750,223
respectively, and the total volume of trade for any given three years
has never reached the average figure of £1,800,000. The totals of the
three years prior to 1900 were respectively £1,441,383, £1,389,922, and
£1,507,288. Making every allowance for the fall in the market price of
certain products during recent years, which, by the way, has been to
some extent counterbalanced by the increased export of new articles, the
conclusion to be derived from these figures is that the Crown Colony
system in Southern Nigeria has not yielded results which the country has
the right to expect, and the moral is that, whatever may be the position
of affairs in other British possessions in West Africa, Englishmen should
really pull themselves together and seriously consider whether the
brilliant future which Nigeria should have in store for it is to run the
risk of being compromised just for want of a little courage in facing the
facts as they are.