Political Patronage in Nigeria Before the Oil Boom was already visible decades before the petroleum windfall of the 1970s transformed the financial power of the Nigerian state. Oil greatly increased the amount of money available to governments, strengthened the federal centre and changed the scale of competition for public resources. It did not create the underlying politics of access, influence and distribution.
Before petrodollars, Nigeria possessed another set of valuable political resources. Agricultural marketing boards held enormous reserves. Regional governments controlled statutory corporations and development institutions. Public employment offered status and economic security. Scholarships could determine who obtained the education required for senior positions. Government finance could support businesses, while Native Authorities and other local institutions remained important centres of political influence.
Development itself was not patronage. Governments legitimately built schools, expanded public services, promoted Nigerian participation in administration and invested in economic development. The political danger emerged when access to public resources became entangled with party loyalty, personal relationships or private interests.
That system was already taking shape before petroleum became the commanding force in Nigeria’s economy.
Agricultural Wealth Before Petroleum
Nigeria’s first great pool of government-controlled economic wealth came not from petroleum but from agriculture.
During the Second World War, British colonial authorities established the West African Produce Control Board to regulate the purchase and export of important commodities. After the war, more permanent Nigerian marketing institutions emerged.
The Nigeria Cocoa Marketing Board was established in 1947. The Nigeria Oil Palm Produce Marketing Board, Nigeria Groundnut Marketing Board and Nigeria Cotton Marketing Board followed in 1949.
Their functions included stabilising producer prices, improving the marketing of export crops, supporting agricultural development and accumulating reserves that could help protect producers against falling world prices.
The boards became extraordinarily wealthy.
In May 1952, the British Colonial Secretary informed the House of Commons that the Cocoa Marketing Board held reserves of £33,001,420. The Oil Palm Produce Marketing Board had £21,638,740, the Groundnut Marketing Board £12,366,833 and the Cotton Marketing Board £3,243,909.
Together, their reserves exceeded £70 million.
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For Nigeria in the early 1950s, this represented a vast concentration of capital.
Much of the money accumulated because producers were paid stabilised prices while international commodity prices could be substantially higher. The marketing boards therefore became central to debates about the extent to which colonial and later regional governments extracted agricultural surpluses from Nigerian farmers.
The reserves were also used for development purposes, including investments connected with infrastructure, agriculture and regional economic programmes.
Once political leaders gained greater control over these institutions, the boards became important components of regional governmental power.
How the 1954 Constitution Strengthened the Regions
The constitutional reforms of the 1950s transformed the political importance of Nigeria’s regions.
Under the Nigeria Constitution Order in Council of 1954, regional legislatures were empowered to establish regional marketing boards, grant them exclusive purchasing powers and regulate prices paid for commodities purchased for export.
The earlier commodity-based arrangement was consequently reorganised around regional institutions, including the Northern Nigeria Marketing Board, Western Nigeria Marketing Board and Eastern Nigeria Marketing Board.
This shift occurred at the same time that mass political parties were becoming entrenched in the regions.
The Action Group became the dominant political organisation in Western Nigeria. The National Council of Nigeria and the Cameroons, later renamed the National Council of Nigerian Citizens, became the principal political force in the East. The Northern People’s Congress established overwhelming political influence in the North.
These parties were competing for much more than seats in legislatures.
Control of a regional government meant influence over public employment, development corporations, scholarships, contracts, investment programmes and institutions capable of directing substantial sums of money.
Political office therefore carried increasing economic power.
Free Education, Development and Political Advantage
The expansion of regional government also produced important social and economic achievements.
Western Nigeria’s free primary education programme, introduced by the Action Group government under Premier Obafemi Awolowo in 1955, expanded access to schooling on an unprecedented scale in the region.
Such programmes could strengthen the political popularity of the government responsible for them, but popularity generated by public policy was not inherently patronage.
Political parties were expected to campaign on programmes and governments were expected to deliver services.
The distinction became important when state institutions were used selectively to benefit political organisations, favoured businesses or individuals connected to those controlling government.
Western Nigeria would eventually provide one of the most closely documented examples of how those boundaries could become blurred.
The Western Region Crisis and the Coker Commission
By 1962, the Action Group had been torn apart by a bitter struggle between Chief Obafemi Awolowo and Chief Samuel Ladoke Akintola.
The conflict destabilised the Western Region, contributed to disorder in the Western House of Assembly and led the federal government to declare a state of emergency.
It was in this atmosphere that the federal government appointed the Coker Commission of Inquiry, headed by Justice G. B. A. Coker.
The commission investigated the affairs of six statutory corporations in Western Nigeria and produced a four-volume report.
Its work followed complicated financial transactions involving institutions such as the Western Region Marketing Board, the Western Region Finance Corporation and the Western Nigeria Development Corporation.
The investigation also examined transactions involving the National Bank of Nigeria, the National Investment and Properties Company and businesses connected with networks associated with the Action Group.
The commission exposed serious weaknesses in the separation between public institutions and partisan political interests.
The Western Region nevertheless had genuine development achievements. During the period, the regional government expanded education, broadcasting, infrastructure and economic enterprises.
The importance of the Coker Commission lies in showing that developmental ambition and political patronage could exist within the same political system.
Institutions established for public economic development could also become vulnerable to party influence when financial safeguards were weak and ruling political organisations exercised extensive control over government machinery.
Nnamdi Azikiwe and the African Continental Bank Crisis
A major controversy had already occurred in Eastern Nigeria during the 1950s.
Nnamdi Azikiwe had been closely involved with the African Continental Bank, an indigenous financial institution that became associated with his wider business interests.
After Azikiwe became Premier of the Eastern Region, questions arose about his continuing relationship with the bank and the placement of regional public resources in it.
In July 1956, the British Colonial Secretary informed Parliament that £877,000 of public money had been invested in the African Continental Bank during 1955, with additional public funds deposited there.
The money had been made available from marketing-board reserves through the Eastern Region Finance Corporation.
The controversy resulted in the appointment of a tribunal headed by Sir Stafford Foster-Sutton, then Chief Justice of the Federation of Nigeria.
The inquiry examined Azikiwe’s relationship with the African Continental Bank, the transfer of assets belonging to the Eastern Regional Marketing Board and the circumstances in which public money was invested in or deposited with the bank.
The African Continental Bank affair unfolded against the wider struggle to establish Nigerian-controlled financial institutions.
Colonial banking was dominated by expatriate banks, and Nigerian businessmen frequently complained that African entrepreneurs had inadequate access to credit.
Building an indigenous bank therefore had an important nationalist and economic purpose.
The controversy arose because public authority and private financial interests overlapped. Azikiwe, members of his family and associated companies continued to have significant interests connected to the bank during the period examined by the tribunal.
The affair became one of the most important examples of conflict of interest in late colonial Nigerian politics.
It demonstrated how programmes presented as economic nationalism could become politically controversial when public resources and private interests were closely connected.
Northernisation and the Battle for Government Jobs
Northern Nigeria faced a different political and economic problem.
British colonial rule had developed Western education unevenly across Nigeria. By the final decades of colonial rule, Northerners were significantly underrepresented in many senior professional, technical and administrative positions.
Northern political leaders regarded the imbalance as a threat to the region’s ability to govern itself effectively.
The Northern Regional Government therefore pursued Northernisation.
The policy was designed to increase the number of Northerners working in the regional public service and reduce dependence on expatriate and southern Nigerian personnel.
Recruitment, training and scholarships became central to the programme.
Billy J. Dudley’s study of northern politics documented the effort to increase northern representation in the higher levels of the civil service.
The policy reflected a genuine manpower problem. The region urgently needed more teachers, administrators, technicians and professionals.
But Northernisation also demonstrated how valuable public employment had become politically.
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A government appointment meant salary, status, influence and economic security. Decisions about who should receive priority therefore became connected to questions of regional identity and political power.
The northern experience was not identical to the financial controversies investigated in Eastern and Western Nigeria. It nevertheless showed that access to state-controlled opportunities had become central to regional politics before the oil boom.
Scholarships and the Rise of a New Political Class
Scholarships were particularly important because Nigeria faced a shortage of trained personnel as independence approached.
Regional governments financed students to study within Nigeria and abroad in order to produce teachers, doctors, engineers, administrators and other professionals.
These programmes could transform lives and were essential to Nigerianisation.
They also placed governments in control of another highly desirable resource.
Education could determine who entered the emerging administrative and professional elite.
The distribution of scholarships therefore possessed political importance even when the scholarships themselves served legitimate development objectives.
Across Nigeria, control of state institutions increasingly meant influence over who gained access to economic and social advancement.
Development Corporations and Regional Economic Power
Regional development corporations became another major feature of the pre-oil political economy.
Governments established institutions to promote agriculture, industry, housing, finance and commercial enterprises.
These corporations were intended to accelerate development at a time when Nigeria had little indigenous industrial capital and limited private access to long-term finance.
They played important roles in building regional economies.
But they also concentrated substantial decision-making power in governments.
Officials could influence investments, loans, contracts and access to state-supported enterprises.
When regional political parties gained control of these institutions, questions inevitably arose about whether resources were being allocated purely for economic reasons or partly to consolidate political influence.
The same tension existed in banking, agricultural finance and public corporations.
Nigeria’s political economy was becoming increasingly dependent on decisions made by public institutions controlled by elected governments.
Native Authorities and Local Political Networks
Political power was also exercised below the regional level.
In Northern Nigeria, Native Authorities remained particularly influential because of the colonial system of indirect rule.
Emirs and other traditional institutions had been incorporated into the machinery of colonial administration and retained important responsibilities involving taxation, local administration and public authority.
As party politics expanded, modern political organisations had to operate within or alongside these older systems of influence.
Local government institutions played similar political roles elsewhere in Nigeria.
Control over local structures could help parties organise supporters, influence communities and strengthen electoral networks.
Nigeria’s emerging parties therefore became deeply connected to the institutions through which government interacted with ordinary citizens.
By independence, political parties had become organisations competing for control of a state that already possessed considerable power to distribute economic opportunity.
Oil Arrived, but Agriculture Still Ruled the Economy
Commercially viable petroleum was discovered at Oloibiri, in present-day Bayelsa State, in 1956.
Nigeria began exporting crude oil in 1958.
Yet oil did not immediately transform the country into a petroleum-dependent economy.
At independence in 1960, agriculture remained fundamental.
Cocoa, groundnuts, palm produce and other agricultural commodities continued to generate substantial export earnings and government revenue.
The transformation accelerated after the Nigerian Civil War.
By 1972, petroleum accounted for about 83 per cent of Nigeria’s exports.
Government revenue was changing just as rapidly.
One World Bank historical series records federally collected revenue of ₦634 million in 1970/71, of which ₦167 million came from gross oil revenue. Petroleum therefore represented approximately 26 per cent of federally collected revenue.
By 1971/72 the share had risen to roughly 44 per cent. It exceeded 54 per cent in 1972/73 and approached 60 per cent in 1973/74.
Then the international oil-price surge of 1973 and 1974 transformed the scale of Nigeria’s petroleum earnings.
Nigeria entered the petrodollar era.
How Oil Changed Nigerian Political Power
The oil boom transformed both the value and location of governmental power.
During the agricultural era, regional governments possessed considerable economic influence because commodities such as cocoa, palm produce and groundnuts generated substantial wealth within their territories.
Petroleum increasingly shifted financial power towards the federal government.
Oil revenues flowed into national institutions and were redistributed among the different levels of government.
The political importance of controlling the federal centre consequently increased.
The amount of money involved also rose dramatically.
Marketing boards had controlled tens of millions of pounds during the 1950s. Petroleum eventually produced revenues measured in billions.
The political networks that had developed around appointments, contracts, public corporations and government influence therefore entered a radically richer environment.
Petroleum did not invent the political value of controlling government.
It multiplied it.
Patronage Was Not the Same as Corruption
Nigeria’s political history becomes distorted when every form of government distribution is described as corruption.
A scholarship awarded to train an engineer was not automatically corrupt.
Hiring qualified Nigerians to replace colonial officials was not inherently corrupt.
Providing free education did not become corrupt simply because voters rewarded the government that introduced it.
Patronage involved the use of political relationships and networks in distributing opportunities or benefits.
Corruption went further, involving practices such as bribery, diversion of public resources, improper personal enrichment or serious conflicts of interest.
Both existed within Nigerian political history, but they were not identical.
Recognising the distinction makes it possible to acknowledge the development achievements of regional governments while also examining the institutional weaknesses that allowed political and private interests to penetrate public administration.
Conclusion
The history of Political Patronage in Nigeria Before the Oil Boom begins long before petroleum transformed the national treasury.
Marketing boards controlled enormous agricultural reserves. Regional governments directed development corporations. Public services offered employment and influence. Scholarships opened paths into the emerging educated elite. Banks and finance corporations connected government resources with commercial activity. Native Authorities and local institutions provided additional centres of political influence.
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By independence, control of government already carried substantial economic value.
Nigeria’s major political parties therefore competed not only over constitutional ideas or regional interests but also for authority over institutions capable of distributing opportunity.
The arrival of petroleum changed the scale of that competition.
Oil strengthened the federal centre, dramatically increased government revenues and made control of national institutions more valuable than ever before.
The political system of the petroleum era was therefore not created on an empty foundation.
Long before petrodollars, Nigeria had already developed a political economy in which control of public institutions could translate into jobs, investments, contracts, credit, scholarships and political influence.
Petroleum enlarged and centralised that system.
Its roots belonged to an earlier age.
Author’s Note
Nigeria’s experience before the oil boom shows why the country’s political history cannot be explained simply by petroleum wealth. Long before crude oil became the dominant source of government revenue, control of marketing boards, corporations, banks, employment, scholarships and regional institutions had made political office economically important. The oil boom later transformed the magnitude of those resources and strengthened the federal centre, but many of the relationships between political power and access to state-controlled opportunity had already developed during the closing decades of colonial rule and the First Republic.
References
Nigeria. The Nigeria (Constitution) Order in Council 1954. Statutory Instrument 1954 No. 1146.
UK Parliament, House of Commons. “Nigeria (Marketing Boards).” Hansard, 6 May 1952.
Colonial Office. Annual Report on Nigeria, 1953. London: Her Majesty’s Stationery Office.
UK Parliament, House of Commons. “Eastern Region, Nigeria (Commission of Inquiry).” Hansard, 24 July 1956.
Great Britain, Colonial Office. Report of the Tribunal Appointed to Inquire Into Allegations Reflecting on the Official Conduct of the Premier of, and Certain Persons Holding Ministerial and Other Public Offices in, the Eastern Region of Nigeria. London: HMSO, 1957.
Federal Republic of Nigeria. Report of the Coker Commission of Inquiry into the Affairs of Certain Statutory Corporations in Western Nigeria. Lagos: Federal Ministry of Information, 1962.
Helleiner, Gerald K. “The Fiscal Role of the Marketing Boards in Nigerian Economic Development, 1947–61.” The Economic Journal, Vol. 74, No. 295, 1964, pp. 582–610.
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Uche, Chibuike Ugochukwu. “Banking ‘Scandal’ in a British West African Colony: The Politics of the African Continental Bank Crisis.” Financial History Review, Vol. 4, No. 1, 1997, pp. 51–68.
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