Mustapha: FG Implementing Policies to Promote Accountability, Transparency


The Secretary to the Government of the Federation, Mr. Boss Mustapha, in this interview, speaks on wide-ranging issues, stretching from fiscal policy decisions and actions of the federal government to varied government’s intervention programmes as the nation battles to combat the dreaded COVID-19 pandemic. Excerpts:

With the attendant negative effect of COVID-19 on crude oil prices, globally, Nigeria’s major foreign exchange earner has taken a bad hit. How has the Buhari administration bridged the gap in funding of the economy?

There is no doubt that COVID-19 pandemic has adversely impacted on the global economy. The virus has affected every aspect of human existence. Industrialized nations of the world are not spared either. Most countries of the world have had to review their economic growth rates. Stimulus packages have been introduced by some other countries to prevent the total collapse of their economies. Nigeria, like many other nations, whose major source of revenue is crude oil has had to contend with the sharp decline in the global crude oil price. The country’s GDP in the first quarter of 2020 was 1.87 per cent compared to 2.27 per cent in 2019 due to the decline in global economic activities occasioned by the COVID-19 pandemic. To bridge the gap in funding the economy, Mr. President constituted the Economic Sustainability Committee chaired by the Vice President. The Committee has submitted its report. Government has also put in place measures to stabilize the economy. The measures put in place are enunciated in Mr. President’s Democracy Day nationwide address on June 12, 2020.

The security and monitoring of the nation’s oil pipelines is of paramount concern given the importance of crude oil to our national life. What effort is the administration making through the Presidential Amnesty office in ensuring that the Niger Delta remains peaceful?

Niger Delta, like every other region of the country, is so important and unique to the economic wellbeing of Nigeria. The administration of President Muhammadu Buhari has since its inception been engaging with leaders and youths of the Niger Delta Region and this effort has yielded remarkable results. With continuous dialogue, peace has returned to the region. We are constantly reminded that peace is a panacea for both economic and social development in the region. The Presidential Amnesty Office has continued to deliver on its mandate by empowering Niger Delta Youths through scholarships and provision of infrastructure and social amenities.

In addition to the role of the Amnesty Office, Government is working hard to reposition the Niger Delta Development Commission to be able to wake up to its statutory responsibility of delivering developmental projects to every community in the region. All these efforts and engagements of government with leaders and youths of the Niger Delta region have resulted in peace and security, making it easier for the law enforcement agents to monitor pipelines in the region.

The North-East Development Commission is a novel project by this administration. What is the progress report as Nigerians are yet to feel the impact?
The North-East Development Commission (NEDC) is the focal organisation charged with the responsibility to assess, coordinate, harmonize and report on all intervention programmess, and initiatives by the Federal Government or any of its Ministries, Departments and Agencies (MDAs), States; and other development partners and for the implementation of all programmes and initiatives for the North- East states of Adamawa, Bauchi, Borno, Gombe, Taraba and Yobe. Since the Management Board was inaugurated in 2019, it has embarked on a number of programmes which are categorized under humanitarian, co-ordination, early recovery, long term development as well as North- East recovery and stability. The commission has been supporting in the fight against COVID-19 in the North East geopolitical zone. The NEDC has also provided medical outreach in Maiduguri. Over 4,000 indigenes have benefitted from the programme. Relief materials are also being distributed from time to time while several communities have benefitted from the provision of social amenities with the objective of improving quality of life among the rural communities. The commission, no doubt, has been working so hard to ensure that the zone is completely rebuilt and developed after years of insurgency.

The fight against corruption is one of the major cardinal projects of the Buhari Administration. Kindly give us a scorecard of the administration’s effort to stamp out graft and what in your estimation are the major obstacles?

In the area of fighting corruption, the Buhari administration has shown a consistent determination to fight the cankerworm decisively. Since the president assumed office in 2015, so much has been done in terms of recovery and prosecution of offenders. In the second term of the administration, the focus is to strengthen all anti-graft institutions; putting in place mechanism that will help stop corruption from taking place at all because it comes with a lot of expenses which I know requires a lot of paradigm shifts. Fighting corruption also entails building structures and evolving policies to make corruption unattractive. I believe that we need to create safety nets for the people in the workplace as a disincentive for corrupt tendencies. Going forward, we should strengthen the institutions and build capacities for them; make sure too that we create safety nets around the whole place so that people can have a bit of comfort. The federal government is quite conscious of the need to deliberately evolve and implement policies and programmes to promote accountability and transparency through the Open Government Partnership. Through the transparency portal on financial transactions we have strengthened auditing and accountability mechanisms so as to ensure that rules and regulations are followed strictly, while minimising fraud and theft of government funds.

The report recently submitted by the committee headed by the Vice President on post-COVID-19 effect is grim, as an estimated 39.4 million jobs would be lost this year. What safety nets is the administration putting in place to cushion the effect?

The pandemic has provided a unique opportunity to x-ray the state of our healthcare sector, which is in dire need of reforms and funding. The weaknesses in our health system became more glaring as we see how more established health systems in Europe and America have buckled under pressure. To directly address the economic challenges of Covid-19, President Muhammadu Buhari approved a Fiscal Stimulus Package as part of an Integrated Policy Framework to ensure that Nigeria’s healthcare system, fiscal position and economy are sufficiently supported to weather these shocks. We have received assurances of support from our partners at the World Bank. We are continuing our engagements with the World Bank, the African Development Bank, and the Islamic Development Bank to access concessional funding to support the implementation of the 2020 Budget. We have also applied for funding from the International Monetary Fund’s COVID-19 Rapid Credit Facility to draw from our existing holdings with the World Bank Group/International Monetary Fund. This loan will attract no conditionalities.

However, it is essential to clarify that Nigeria does not intend to negotiate or enter into a formal programme with the International Monetary Fund at this time or in the foreseeable future. The federal government has provided N102.5 billion in resources to be available for direct intervention in the healthcare sector. Of this sum, the government has already made available N6.5 billion to the NCDC for critical expenditure. The federal government remains committed to supporting the states in these difficult times in battling with the COVID-19 pandemic. The federal government is committed to the augmentation of the states’ FAAC allocations and moratorium on states’ debts. Based on the financial assumptions underpinning of the 2020 Appropriation Act, the Federal Government projected the monthly Federation Account Allocation Committee disbursements to the Federal and State Governments at N888.5 billion. However, due to the significant drop in international oil prices, FAAC monthly disbursements have declined in recent months to N716.3 billion in January and N647.4 billion in February 2020. Our experience shows that monthly FAAC receipts must average at least N650billion for the Federal and State Governments to meet their current obligations.

We must prepare our minds that monthly receipts may decline to below N400 billion, over the next three to six months. To address these emerging fiscal risks, Mr. President has approved the withdrawal of US$150million from the Nigeria Sovereign Investment Authority Stabilisation Fund to support the June 2020 FAAC disbursement. The federal government has created the Stabilisation Fund for such emergencies and Government will utilise it for this purpose. Government is exploring other options to augment FAAC disbursements for the 2020 fiscal year. The President has approved that the Federal Ministry of Finance, Budget and National Planning should engage with the CBN to agree on a Debt and Interest Moratorium for States on Federal Government and CBN-funded loans. The moratorium will create fiscal space for the States, given the projected shortfalls in FAAC allocations. Accordingly, once monthly average FAAC receipts fall below a specific threshold, relevant bodies will suspend interest and capital payments by States until monthly average FAAC receipts exceed the threshold.

The moratorium intervention is vital to create fiscal space for the states, as they deal with the health and economic impact of the crisis. The federal government will also encourage states to explore similar arrangements for their outstanding debts to commercial banks. The Finance Act 2020 provided significant tax relief for micro, small and medium-sized enterprises. The Finance Act has also expanded the VAT Exemption List for essential food, medical supplies and other basic items that are critical in the effort to address the COVID-19 pandemic. Government has also granted a two-month waiver on licence fees for broadcast organisations.
The 2020 Appropriation Act rested on certain fiscal assumptions that certain economic realities have compelled the government to revisit given the emerging economic realities.

How would you assess the leadership of the national oil company under Mr. Mele Kyari, given the fact you have worked with him closely during this Covid-19 intervention?

Mr. Mele Kyari, the Group Managing Director of the Nigerian National Petroleum Corporation, has brought dynamism and pragmatism to the management of the organisation. NNPC under his leadership has contributed immensely to the national response to COVID-19 by mobilizing private investors to contribute and support the efforts of the Presidential Task Force on COVID-19. As a result of his efforts and that of the Governor of the Central Bank of Nigeria, substantial donations both in cash and kind have been received by the Federal Government. Although the coronavirus pandemic happened on us without warning, I think as a nation we have not done badly in our national response.

Government and the private sector players alike have been quite responsive in the effort to combat the disease and defeat the pandemic. The NNPC has lived up to its status as a corporate giant, rallying companies in the oil and gas sector to raise funds and provide the critical equipment and facilities through their international contacts. We cannot but commend Mele Kyari and his team for their patriotic spirit in raising funds running to billions of Naira and applying the same judiciously. By and large, the NNPC has acquitted itself well in discharging its corporate social responsibility
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