A Change Agent in the Tax Office: Nigeria's Federal Inland Revenue Service, 2004-2009

Abstract

In 2004 Ifueko Omoigui Okauru, a management consultant with no previous government experience, took on the challenge of fixing Nigeria’s corrupt and dysfunctional tax system. As executive chairman of the Federal Inland Revenue Service, she was responsible for reforming a weak and ineffective organization to meet the needs of a changing country. To reduce its heavy dependence on oil, Nigeria needed to diversify its revenue streams beyond the petroleum sector. Improved tax administration offered an avenue toward achieving that goal. In overhauling the tax system, Omoigui Okauru had to overcome entrenched opposition from private consultants who earned high pay under the existing system, defeat the institutional inertia that characterized the revenue service, and curb the corruption that fueled citizens’ distrust and hampered tax collection. To advance her vision for modernized tax administration, she recruited talented professionals and instituted specialized career tracks for employees, alongside additional training modules for existing staff and a reorganization of departments and functions. This case study chronicles the first five years of Omoigui Okauru’s efforts to improve tax collection in Nigeria and offers an example of how an outside leader working with a team of experienced professionals can build the coalitions necessary for legislative, policy and administrative reforms.

Richard Bennet drafted this case study based on interviews conducted in Abuja, Nigeria in September 2011, and interviews conducted and text prepared by Itumeleng Makgetla in September 2009. Case published January 2012.
Keywords
training
tax reform
insitution-building
capacity-building
revenue service
tax consultants
independent agencies
Focus Area(s)
Civil Service
Critical Tasks
Civil service corruption
Civil service recruitment
Computerization of records
Inter-ministerial coordination
One-stop shops
Performance management system
Single agency turnaround
Training
Core Challenge
Institutional traps (spoilers)
Principal-agent problem (delegation)
Country of Reform
Nigeria
Type
Case Studies
Author
Richard Bennet