Nigeria has an estimated population of 150m people of diverse backgrounds. There is widespread acceptance that amongst the country’s, citizens are highly intelligent and resourceful professionals in every sphere of human endeavour. The availability of requisite human resources is fundamental to the development of any nation and that is why professionals are highly regarded in every society. There is no doubt that for our country to achieve its desired goals, its professionals must play a vital role. Regrettably, Nigeria remains highly undeveloped with one of the highest poverty rates in the world. The Minister of Lands, Housing and Urban Development, Hon Nduese recently remarked that over 86% of Nigerians earn less than $2 a day and that 90% can’t afford a house of N1.5m even if they saved their total earnings for 10 years. The World Bank ranks Nigeria 144th amongst the countries of the world in terms of GDP per capita of population and 158th in its Human Development index, which effectively measures the standard of living. Every available data point to our low level of development and it will require concerted effort and leadership to reverse the trend.
PRESENT STATE OF THE NATION
It was against this back drop that successive governments in Nigeria have made concerted efforts to redress the imbalance and return the country to the path of growth anchored on a diversified economic base. In this wise the year 2000 we were then told was to be the turning point as “everything” was to become available to “every body” in that year. Of course the year came and passed without funfare. We have since then seen the launch of the Vision 2010 and the National Economic Empowerment and Development strategy (NEEDS) at the national level to jumpstart our economy.
It is basically due to the failure of these past programmes that led the present administration to launch the Vision 20:2020.
The present administration in effect latching on to the earlier “visions” launched the vision 20:2020. The vision is aimed at placing Nigeria among the largest economies in the world by the year 2020. Part of the underlying inspiration for the vision was a study on the Nigerian economy published in 2005 by Merrs. Goldman Sachs. The report which considered amongst others, geographical size, demographic trend, resource endowment and the performance of the economy had concluded that if the tempo of our economic performance is sustained, Nigeria has the potential to be among the 20 largest economies in the world by the year 2025. Nigeria is today ranked amongst the N11 countries based on the above criteria and the foundation for reform already land.
To achieve the target of the Vision; the country will have to advance from our current ranking based on GDP of 40 to a ranking of 20 in the year 2020. It also means that in Africa, Nigeria must rise from our current 3rd position with a GDP of $294.8b to surpass Egypt with a GDP of $432.9b and South Africa ($467.6b), within the same period. The prerequisite, for attaining this position cover political, economic, social, technological and other areas. Politically we need to maintain political stability within the period. Economically, we need to double our present GDP growth rate of about 6.5% and sustain a consistent growth rate of at least 12.5% over the period to get to our desired position (i.e. assuming the other countries remain static which of course is not possible). Socially and technologically, we also need to make radical changes that will simulate growth in key sectors of our economy in order to raise our GDP from the current $294.8b to of least $900b by 2020.
From the above scenario, it can be seen that if the developmental goal set by the vision is to be attained, a lot will need to be done.
THE PROFESSION OF ESTATE SURVEYING AND VALUATION
Estate Surveyors and Valuers refer to professional members of the Nigerian Institution of Estate Surveyors and Valuers, a body established in 1969 to cater for the interests of the landed profession in Nigeira. The Institution was accorded official government recognition by the promulgation of the Estate Surveyors and Valuers Registration decree No. 24 of 1975 (now CAP 111 LAWS of the Federation of Nigeria, 1990).
The legislation established the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) as a corporate body empowered to regulate the profession of Estate Surveying and Valuation in Nigeria. CAP 111 LFN, 1990 defines the profession of Esate Surveying and Valuation as the art, science and practice of:
- Determining the value of all descriptions of property and of the interests therein;
- Managing and developing estates and other businesses concerned with management of landed property;
- Securing the optimal use of land resources and its associated resources to meet social and economic needs;
- Determining the structure and condition of buildings and their services before advising on their maintenance, alteration and improvement;
- Determining the economic use of land resources by means of financial appraisal for the building industry and
- Selling (whether by auction or otherwise), buying or letting (as an agent) of real and personal property and any other interest therein.
The objectives of the Institution are four fold, namely:
- To establish a high and reputable standard of professional conduct and practice in the landed profession throughout Nigeria:
- To secure and improve the technical knowledge in all aspects of land economy amongst its members and facilitate the acquisition of such knowledge by close collaboration with Universities, other institutions of higher learning and professional bodies:
- To promote the general interest of the profession, maintain and extend its usefulness for the public good; and
- To acquaint the public with the role of the Estate Surveyor and Valuer in the economic development of Nigeria.
The scope of professional services of the Estate Surveyor and Valuer includes the following:
- Valuation of interests in land or buildings, plant and machinery, furniture, fittings, equipment, motorized vehicles, engineering and infrastructural installations, etc.
- Valuation for the compulsory acquisition of interests in land and buildings for compensation purposes.
- Feasibility and viability appraisal of development projects
- Valuation for tenement rating purposes
- Property sales and leases (Estate Agency)
- Property and Facility Management
- Project Management
- Building Maintenance Management
- Project finance procurement and syndication
- Property inventory and audit
- Real estate asset Management
- Land Use planning and analysis
- Advise on property rights and transfer
THE PROFESSION AND NATION BUILDING
Having dwelt on the state of our nation and the overall roles of an estate surveyor and valuer, I now wish to address how these roles can assist in nation building and influence government decisions in the area of funding of government projects and wealth creation. It is general knowledge that most of the states that make up our Federation are not viable and rely mainly on their share of funds from the Federation account. As Federal Government revenue continues to decline, governments at all levels are finding it difficult to meet their commitments to developmental projects, which as we know are generally capital intensive.
It becomes necessary for governments to partner with professionals like Estate Surveyors and Valuers to find ways of raising funds for developmental projects through land based taxation and better utilization and management of real estate assets for the various levels of government. Another area where this partnership will be most useful is in the fight against corruption.
Two very vital sources of land based taxes in our environment are tenement rates, ground rents, title transfer and registration charges.
This is a local rate usually levied by the Local Government Councils for the provision and maintenance of local facilities. Incidentally, only very few states have undertaken the necessary rating valuation exercise to determine the rates payable per hereditament. This is one area where the expertise of the estate surveyor and valuer can be tapped by the local government councils to raise necessary funds for service delivery to the people. The Estate Surveyor and Valuer is not only trained in the area of rating valuation but can also assist the local councils in the collection of the rates.
ground rent, title transfer and registration charges
By virtue of the Land Use Act, all land in the territory of each state is vested on the Governor of the state, who holds the land in trust for the people. The Act also created a statutory title to land known as the statutory leasehold and customary rights of occupancy to be granted by the Governor or the Local Government Chairman respectively. Either title is usually denoted by a Certificate of Occupancy usually given to the holder as evidence of title. The import of the Act is that the Governor is deemed the lessor of all land in the territory of each state and grants only 99 years leasehold interest to beneficiaries. The beneficiaries usually pay an annual ground rent to the government. By virtue of the act, all transfer of interest in land must receive the consent of the Governor for it to be legally binding. The consent procedure will usually involve the payment of necessary transfer charges and title registration fee to the government. Incidentally, only a small portion of the land in Nigeria has registered title or is covered by Certificates of Occupancy. Available data indicate that only 3% of our land area has registered title. The import of this are:
- Government can only earn the ground rent and other transfer charges from plots with registered title as it is only such plots that are “known” to the government. Due to the lack of title and high cost (resources and time) of obtaining consent or a new title (C of O), the bulk of land transactions exist in an “informal market outside government control and effectively provides no income to the government.
- Owners of most of the vast land of Nigeria can not use their land as collateral to secure loans for their business due to lack of registered title. The vast majorities of our people do have land holdings but still remain in the poverty bracket due to this constraint. When the land is not registrable, it attracts low sale value, is prone to all manner of ownership dispute and is not easily convertible. Such land fall within the realm of “dead capital” and is a major hindrance to wealth creation.
- Widespread poverty as is presently prevalent does not make for national development nor does it enhance nation building. Land taxation is vital for promoting democratic, transparent and accountable governments through facilitating their access to a stable revenue base. It is now proven that tax payers are more prone to hold their governments accountable thereby ensuring a stable polity over time.
The Estate Surveyor and Valuer is well placed to provide necessary advice and guidance to the government at all levels in this regard. It is in recognition of the untapped potentials of our land resources that we have been clamoring for a reform of our land policy that will entail delineating and granting secure title to every plot of land in Nigeria. This is a tedious exercise but it has the capacity to unleash the immense potentials of our land resources, enhance wealth creation, provide necessary funds for the government on a stable basis and put our dear country on the path of growth. We have indeed been clamoring for a National Land commission to superintend this process and ensure an efficient management of our land resources.
A CASE STUDY OF LAGOS STATE
I believe that the Lagos State Government has taken steps to harness the immense potentials from land based taxation. The state has streamlined the process of obtaining Governors Consent, planning approvals and Certificates of Occupancy. For Governors Consent, it now has what it calls “The 30-day Consent” that will enable you obtain consent within 30 days. The Physical Planning office has also been decentralized to make it easy to obtain planning approval for projects. Land owners are being encouraged to apply for Certificate of Occupancy for their plots. Indeed before you can apply for planning approval for an untitled land, you must at the same time apply for the Certificate of Occupancy. Whilst the cost of all these remain very high (consent is 15% of the assessed value of the property), and long delays still exist. The state approach has been welcomed by people because there is no doubt that the process is a lot easier. The state has also made payment of these charges easier for the paying public through the Banks and other payment centres. The Government also invested heavily in land information systems and personnel. The states target is to essentially capture every land holding in Lagos with appropriate details of the ownership, land use and user in order to enhance its revenue collection and also assist the state in physical planning, crime control and distribution of infrastructural projects.
The result of the states efforts can be seen in the high revenue, which it realizes from land. In 2009, for instance, the state’s lands department realized an income of N18.55b and this figure is expected to increase this year.
It is pertinent to mention that the state has still not placed the required credence on the utilization of the services of Estate Surveyors and Valuers. Vital specialist roles are still occupied by unqualified personnel. We in fact believe that if these issues are addressed appropriately by the state, the present revenue base has the potential to increase very significantly.
MANAGEMENT OF REAL ESTATE ASSETS
Real estate assets are one of the most important assets available to any government whether in terms of fully developed or undeveloped lots. Unfortunately, the management of most of these assets are not taken seriously or are at best left in the hands of unqualified persons. The result is that these assets are very badly managed and dilapidation tends to set in within a short time in the life of the property due to repair issues that are not attended to. The story of our poor maintenance culture is well known. The effect is that most public buildings and facilities are in disrepair.
Recently, the Economic and Financial Crimes Commission (EFCC) has seen the need to hand over seized real estate assts to Estate Surveyors and Valuers for management. Also very recently, the Central Bank of Nigeria has gotten the legal nod to set up the Asset Management Company of Nigeria (AMCON) to take over from the banks the collateral assets of those loans that are deemed non-performing. There is no doubt that the bulk of these assets will be real estate. The Institution is making representations to the Central Bank and we hope that they will see the need to partner with us and ensure that these assets are put in the care of our members for proper management.
FIGHT AGAINST CORRUPTION
Corruption remains a major impediment to our development as public funds are diverted to private pockets. Politicians and public office holders are known to acquire huge wealth whilst in office. Incidentally, our laws provide that key public office holders should declare their assets at the beginning and end of their tenures. Apart from the fact that most people don’t bother with this, the Code of Conduct Bureau, which handles this do not also have the appropriate personnel to authenticate the values of the assets declared. You will agree with me that based on our history, every asset declared should be properly valued by an estate surveyor and valuer to authenticate the value. The Institution has had cause to meet with the Leadership of Code of Conduct Bureau in this respect and we believe very strongly that if our members are involved (as they should be), the cases of spurious values being given to assets (in anticipation of acquiring or upgrading them at a later date) will be a thing of the past.
I believe that it is in these areas that a partnership between the public sector and the profession of estate surveying and valuation can be truly felt. Beyond all other advisory roles earlier highlighted, a partnership in this regard will go a long way in raising funds for the government, enhance wealth creation among the citizenry and also ensure optimal management of our real estate assets. The Profession has stretched out its hand and awaits the governments at all levels to partner with her in this regard. The Institution and our entire membership must continue to lead the national advocacy to ensure that the need for this partnership is brought to the forefront for the sake of our country.
Perhaps a clear indication of the low importance that our governments attach to the management of our land resources is in the area of not ensuring that appropriate personnel are put in the right places to administer land matters. For instance, whilst the Land Use act clearly states that only a qualified estate surveyor and valuer can be appointed a director of lands, this law is not obeyed in most of the states. Public buildings are not put under the care and management of estate surveyors and valuers, who are trained in Property Management thereby exposing the buildings to poor management with its attendant problems.
It is time to attach the appropriate importance to the utilization and management of our land resources and put our country on the path to development. Estate Surveyors and Valuers are trained and ready to play their part and partner with the public sector in this regard.
Thank you for reading.