The Alliance for Economic Research and Ethics (AERE), a leading think-tank on Nigeria’s economic system, has decried the rising cost of public governance in the country and estimated that the proliferation of Ministries, Departments and Agencies (MDAs) was costing over N862 billion yearly and worsening the business environment and undermining efforts to strongly position the economy on the path of sustainable growth.
The group, in a statement issued by its Chairman, Barrister Dele Oye, advised the Federal Government to urgently implement the Oronsaye Report, which partly recommended the mergers of MDAs, describing it as the most practical roadmap for reducing the cost of governance and eliminating overlapping government agencies.
He recalled that the Steve Oronsaye Presidential Committee on the Restructuring and Rationalisation of Federal Government Parastatals, Commissions and Agencies, set up in 2012, recommended a reduction in the number of statutory federal agencies through mergers, abolitions and restructuring, with projected savings of about N862 billion between 2012 and 2015.
Oye, a former President of the Abuja Chamber of Commerce, Industry, Mines and Agriculture (ABUCCIMA), rued that despite the report and the Federal Government’s approval of some of its recommendations in 2023, implementation had remained slow, while the number of federal agencies had increased to over 900.
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According to him, the rising number of agencies has created overlapping mandates, duplicated regulatory responsibilities and increased compliance costs for businesses, discouraging investment and economic expansion.
Citing the recent sealing of three milk factories in Awada, Onitsha, by the Federal Competition and Consumer Protection Commission (FCCPC) to justify his argument, the AERE chairman stated the incident highlighted the inefficiencies of Nigeria’s fragmented regulatory system.
For instance, Oye noted that manufacturers of food products were required to deal with multiple regulators, including the FCCPC, the National Agency for Food and Drug Administration and Control (NAFDAC), and the Standards Organisation of Nigeria (SON), each exercising similar regulatory powers over the same businesses.
He lamented that the resulting duplication had created unnecessary bureaucracy that raises the cost of compliance and encourages many small businesses to remain in the informal sector rather than subject themselves to multiple regulatory requirements.
The AERE chief clarified: “In Nigeria, a manufacturer producing dairy products does not face one regulator; they face a constellation. NAFDAC demands product registration and facility inspection. SON demands standards compliance and certification. The FCCPC demands consumer protection compliance. Add the State Environmental Agency, Local Government trade licenses, and perhaps the Nigeria Agricultural Quarantine Service (NAQS), and you have a recipe for paralysis.
“These manufacturers are caught between a rock and a hard place. They cannot move forward without satisfying all six agencies, yet each agency operates as if it alone holds the keys to public safety. It is not merely bureaucratic inefficiency; it is bureaucratic warfare.
“The ancient wisdom captured in the proverb ‘Too many cooks spoil the broth’ has never been more apt. When three different federal agencies have the statutory power to seal a single factory, we are no longer talking about regulation. We are talking about an administrative circus where the performer is the private sector and the audience is watching them collapse under the weight of compliance.
“The reality is this: we have created a system where the cure is worse than the disease. Regulatory agencies, meant to protect consumers, have become so numerous and so contradictory that they are now the primary threat to business viability.”
“In 2012, the Oronsaye Committee Report revealed that Nigeria had 541 statutory federal agencies. It recommended a drastic reduction to 163 –abolishing 38, merging 52, and reverting 14 to ministerial departments. The projected savings? A staggering N862 billion between 2012 and 2015
“Fast forward to 2026. Rather than shrinking, the beast has grown. Nigeria now groans under the weight of over 900 MDAs.The Oronsaye Report, despite a 2023 approval by the Tinubu administration for selective implementation, remains largely a victim of bureaucratic self-preservation and political patronage. Fourteen years have passed. Not a single recommendation has been fully implemented”, Oye added.
He maintained that the proliferation of agencies had created a perverse incentive structure that turns regulators into predators as many MDAs had metamorphosed from protective regulators into aggressive revenue generators and justifying their existence by the fees, levies, and fines they collect, while the OPS was treated not as an engine of growth, but as a host to be parasitized.
Oye disclosed that in Q1 2025 alone, N658 billion was deducted as “cost of collection” from Federation revenue with revenue agencies like FIRS (retaining 4%), NCS (retaining 7%), and NUPRC (retaining 4%), thereby creating a system where the machinery of government feeds on itself. These deductions now exceed the total allocations to multiple states.
He rued: “This is not regulation. This is legalized extortion. The idiom “killing the goose that laid the golden egg” perfectly captures what is happening. We are so focused on extracting revenue from the private sector that we are destroying the very engine that generates that revenue.
“The economic impact is devastating. The National Development Plan 2021-2025 acknowledged that 85.7% of required investment must come from the private sector. Yet, we maintain a regulatory architecture that actively repels investment.
“We cannot simultaneously maintain a 900-agency bureaucracy and expect robust private sector investment. We cannot create overlapping regulatory jurisdictions and expect business confidence. We cannot treat compliance as a revenue opportunity and expect formal economic participation. We are trying to have it all, and we are getting nothing.
“Paradoxically, regulatory excess creates the very conditions it seeks to prevent. When formal compliance requires navigating a maze of overlapping agencies, each with its own fees and potential to shut down operations, small producers choose to remain invisible. They migrate to the informal sector, operating in the shadows, far from the reach of any regulator”, the AERE Chairman added.
Oye, who is a legal expert, stated that the choice before Nigeria’s policymakers remained clear – to continue down the path of bureaucratic proliferation, regulatory overlap, and economic suffocation, or have the courage to implement the structural reforms that have been gathering dust in the Oronsaye Report for over a decade.
On the position of the think-tank, he clarified that the group was not asking for revolution but asking for implementation of the Orosanye’s report.
He canvassed: “The private sector is bleeding. Investors are fleeing. Informal economic activity is exploding. And yet, we continue to add more agencies, more fees, more complexity. This is not governance. This is slow-motion economic suicide.
“To the policymakers reading this: You have the blueprint. You have the data. You have the moral authority. What you lack is the political will. The 900-headed monster will not slay itself. It will only grow fatter, more voracious, and more destructive. Only decisive leadership can break the chains of bureaucratic self-preservation and restore Nigeria’s regulatory architecture to its proper purpose: protecting citizens and enabling prosperity.
“The question is not whether reform is possible. The question is whether Nigeria’s leaders have the courage to pursue it”, Oye stressed.
