OUTSIDE THE BOX
BY ALEX OTTI
Let me start with a fairly old story which was recently repackaged and circulated on the social media. It’s about two friends; one Nigerian and the other from an Asian country. The Nigerian paid a visit to his friend who had been appointed a minister a few years earlier and was surprised at the magnificent house that his friend had built for himself. He asked him how he made the money to build such a house. The minister took him to his balcony and pointed to a well paved road. He then said, ‘90% for the road and 10% for the house.’ It did not end there because a few years later, it was the turn of the Nigerian who had now been made a Minister, to host his Asian friend, who, to his chagrin, had built an even more luxurious mansion that made that of his Asian friend look like a mere cottage. The house was finished with expensive granite, the fittings were out of this world with eye-popping Italian furniture. His befuddled guest asked him how he managed to fund such an edifice . The Nigerian then took him to his own balcony and pointed at an untarred road. He then quipped, ‘0% for the road, 100% for the house!’. This story may be one of such stories popularly referred to as “fabu” or tales by moonlight, but then fiction is often the best way to tell a true story.
Just about a month ago, President Muhammadu Buhari swore in the 43 member cabinet ministers following their confirmation by the Senate. It was a celebration of some sorts for many of the appointees as they were hosted to multiple parties and receptions. Not a few organized thanksgiving services to mark their appointment. One of the ministers, name withheld, did not see any reason to celebrate. In fact, he was not happy with his posting. He was expecting an appointment to what is now known as a “juicy” ministry. A few intimate friends were even more unhappy. They had positioned themselves to take advantage of the expected position, which blew up in their faces when the minister missed the desired posting. But of course, it is not in our character to resign or decline an appointment even when we are unhappy with it. Perhaps, the few exceptions one can remember include Ochiagha Ebitu Ukiwe, Prof. Lesley Obiora, Chief Ebitimi Banigo, and Dr. Ngozi Okonjo-Iweala. One of the more remarkable ones was that of Mr. Udoma Udo Udoma. He had contested and won an election into the Senate. President Obasanjo subsequently nominated him for a ministerial position. When it turned out that he was assigned a portfolio as Minister Of State which some people refer to as Junior Minister, Mr Udo Udoma declined the appointment, preferring to remain in the Senate. He was to be nominated again in 2015 as Minister of Budget and Planning in the last Cabinet, a position he held until the end of the first term of President Buhari’s government, early this year.
The term “juicy” seems to have gained currency since the beginning of the fourth republic. And it is not just used for appointments to the Cabinet, it also applies to the legislature. So, you would hear of appointments into “juicy” Committees in both House of Representatives and the Senate. Sometimes, the lobby to be appointed to “juicy” committees becomes so intense that some of us begin to worry what exactly is in it? How did we come by that word in the first place? What exactly do we intend to communicate? Common sense understanding of the word “juicy” points to something that has a lot of juice and therefore sweet to eat. A juicy fruit would refer to a fruit that has very succulent contents that can be squeezed out or extracted and the essence of juicing is consumption. So, even before the appointments are made, we have already taken the position that the appointee is going there to juice the ministry or committee. Expanding it further, it can be understood that the whole essence of such appointments is not service to fatherland, but extracting the sweet part of the ministry or committee for the benefit of the appointee and his cronies. This, sadly, is the understanding of both the appointees and their relations and friends. That being the case, it should not surprise us why people go into a frenzy when appointments are being made. Even President Buhari himself fell into this same juicy trap when he visited Kaduna State shortly after swearing in the ministers. Speaking at the palace of the Emir of Zazzau, Shehu Idris, during a courtesy visit on Wednesday, August 21 this year, the president was quoted to have said: “Kaduna and Kano are the only two states I gave two substantive positions in my council. So, I have appreciated your votes and paid you back by giving you Ministers of Environment and Finance.”
The point here is that across the entire spectrum of the Nigerian society, there seems to be the understanding that it is neither competence nor skills that are important in assigning responsibilities and positions to appointees of government. On the contrary , the overriding consideration is putting favoured ones where they can go to extract ‘juices’ from their positions. I believe this is at heart of the problem of this country. Until we begin to see appointments for what they are supposed to be, service, we will hardly make progress.
Another issue that gives cause for concern is the manner in which functions are sliced and diced when these appointments are being doled out. One of the most intriguing ones in President Buhari’s first term was the lumping of Power, Housing and Works in one Super Ministry. The jury is still out on how that worked judging from the challenges that still face us in those three key sectors of the economy. Again, looking at the appointments this time, some of us were surprised at the merger of the Finance Ministry with Ministry of Budget and Planning. There is no gain saying that these are very large and important ministries that were separate in the first tenure of the Buhari Administration. It may be a very tough one for the minister to deal with. We were also worried that there were no economic experts in the cabinet. Granted that two of the ministers, Ministers of State for Transport and that of Budget and planning have degrees in economics, one does not see them as practitioners as such, going by what they were doing in the past. Given the enormity of the economic challenges we are facing, we expected to see more subject matter experts in the cabinet.
Only recently, the National Bureau of Statistics (NBS) released its report for the second quarter of this year. One instructive point is that the economy contracted for the second time this year. While GDP growth dropped from 2.38% in Q4 2018 to 2.10% in Q1 2019, we recorded yet another drop to 1.94% in Q2, 2019. Recall that our projected growth rate for the economy for this year is 3%. It should be pointed out that this rate is just about the population growth rate, if not slightly lower. This then amounts to a negative growth in the real sense of it. It should also be of note that average daily oil production equally dropped marginally from 1.99 million barrels per day in Q1 2019 to 1.98 million barrels per day in Q2 2019. Agriculture, which has been promoted as a major diversification sector, also lost ground in Q2 2019, as it grew by 1.79%, compared to the 3.17% growth it recorded in Q1 2019. Official unemployment rate still remains at a staggering 23% with over 22 million people out of job. Revenue remains very low and our debt profile has remained at such levels that we spend over 60% of our national revenue to service debts. Poverty levels have remained high with close to half our population living below poverty line. Meanwhile, in the face of imminent economic crisis we are proposing an increase in VAT rate. Those who understand economics will tell you that you don’t increase taxes when the economy is depressed, otherwise you will precipitate more crises. We should actually be doing the opposite. This is just one out of the several policy areas that thoroughbred economists can help the government with.
We, however, commend the President for setting up an economic advisory council, headed by the erudite Prof. Doyin Salami. Those familiar with this column will recall that on October 18, 2016, yours truly had advised the President to set up an economic team. In the article titled “Mr. President, You Do Need An Economic Team” we had insisted that given the serious challenges facing the country at that time, many of which remain till today, the President needed to set up a crack team to advise him on the economy. We went further to suggest names which were sent to the President privately. I am glad that no less than three of the names we suggested made it to the list, even if it came three years late. I have no doubt that the team would do a good job given the pedigree of the members who are some of the best brains in the subject matter. It is important that the council hits the ground running immediately. Some major areas that one would expect the team to quickly brainstorm on will include such issues as dwindling revenue of the government and the ballooning national debt, its service and sustainability. They may also wish to look at the structure of the government itself and advise on how best to prune down government expenditure to the barest minimum. A situation where 70% of our budget still goes into recurrent expenditure is unsustainable. Job creation also has to be on the front burner, given the level of unemployment in the country. The issue of monetary and fiscal policies cannot be overemphasized as priority areas. Of course we had highlighted our concern with taxation earlier and we believe It should not be overlooked. They may also like to look at subsidies generally. This would include the persisting subsidies that exist in the oil and foreign currency sub-sectors of the economy. There is an agreement that even in the face of dwindling revenue, we have continued to ‘protect’ the value of the Naira against foreign currencies. Can revenue be boosted by removing the subsidies on Petroleum products and selling our hard earned foreign currency at market rates? I am sure the council will have a whole lot more on its plate but members have the appetite and experience to eat up whatever menu is placed before them. Our prayer is that the President and his government would heed the advice of the professionals appointed to the team. The President should also prepare to make some difficult decisions as one can predict that the council will come up with some news that may not sound so sweet to the ears of the President, but that is the nature of economics.
Finally, please permit me to use this opportunity to wish fellow Nigerians a happy 59th independence anniversary.