Subduing Poverty via Social Safety Net

James Emejo writes that the federal government should re-examine its social investment programmes and introduce greater transparency and accountability in order to record meaningful success in the fight against poverty.

A report by the National Bureau of Statistics (NBS), which indicated that 133 Nigerians are living in poverty, has further exposed the inherent weaknesses in the country’s social protection architecture and the need to rid it of all inefficiencies.

The report is particularly disturbing for the current administration, which had promised to make a dent in ravaging poverty in the country.

In 2019, Buhari hinted that his administration planned to lay the foundation for 100 million Nigerians to be lifted out of poverty.

Speaking at a retreat for ministers-designate in Abuja, Buhari said the target would be achieved at the end of his eight-year term in 2023.

He said, “Our Administration’s eight years will have laid the grounds for lifting 100 million Nigerians out of poverty in 10 years, this outcome will fundamentally shift Nigeria’s trajectory and place us among the world’s great nations.”

Also, Buhari, in April 2021, further approved the National Poverty Reduction with Growth Strategy (NPRGS) to accelerate the reduction in poverty through economic growth, redistributive programs, and shared prosperity.

Essentially, the strategy is anchored on macroeconomic stabilisation, industrialisation, structural policies and institutional reforms, and redistributive policies and programmes that provide social protection as well as support Buhari’s goal of lifting 100 million Nigerians out of poverty within a decade.

But according to the Nigeria Multidimensional Poverty Index (MPI) 2022 Survey, no fewer than 133 million Nigerians, representing 63 per cent of the population are currently living in multi-dimensional poverty.

The report further noted that of the total, 105.98 million poor Nigerians are located in rural areas compared to 16.97 million in urban areas.

This showed that the administration had failed in its quest to tame poverty given that more than 83 million Nigerians lived below the national poverty line in 2019, according to the statistical agency.

Defects in Social Protection Scheme

If anything, the country’s social safety had attracted controversies in recent times as critics said social interventions lacked transparency and were marred in corruption.

Interventions are believed to be cornered by intermediaries, a situation that often politicizes the schemes and limits vulnerable populations from benefitting direct.

It is particularly curious that despite the trillion of Naira spent by the government to alleviate poverty, particularly in the wake of the COVID-19 pandemic, the number of Nigerians living in penury has barely improved.

According to Wealth Management and Business Development Consultant, Mr. Ibrahim Shelleng, the government had failed to tackle the root causes of poverty over the years “but has rather taken a fire brigade approach albeit amidst crippling macroeconomic conditions”.

In a chat with THISDAY, he said, “We have to acknowledge that the fight against poverty will not be won overnight. It is a result of years of systematic failures in our system to address the issues that affect the most vulnerable in our society.

“Policies alone cannot solve the issue. There needs to be a concerted effort in implementation, accountability, and consistency.

“For example, a minimum wage of N30,000 was passed years ago but has still not been implemented or enforced across the country and despite massive inflation, has not even been reviewed.”

Shelleng, also noted that the MSME sector which has been the lifeblood of the economy has been crippled through unfavourable policies such as capital controls, multiple taxations, inadequate infrastructure, and unfavourable monetary policy all this against a backdrop of worsening insecurity.

He said, “Yet despite massive government spending on social welfare, it has failed to reach the intended recipients, who are those at the base of the pyramid. Welfare spending that just looks to give cash to the poor will not solve the poverty problem.

“What is required is spending in areas that will increase productivity. The old adage of give a man a fish and he eats for a day but teach him how to fish and he eats forever resonates.

“Focusing on tackling corruption alone does not solve the issue. Rather, enabling the flow of money through the system will give better results.”

 A dire situation

According to the Nigeria Multidimensional Poverty Index (MPI) 2022 Survey, there are high deprivations in sanitation, time to healthcare, food insecurity, and housing.

Also, poor people experience over one-quarter of all possible deprivations.

Moreover, both the incidence and intensity of poverty at 62.9 per cent and 40.9 per cent respectively exceeded the 26 per cent poverty cut-off threshold

The report stated that over half of the 200 million population who are multi-dimensionally poor cook with dung, wood, or charcoal, rather than clean energy.

According to the report, multidimensional poverty is higher in rural areas where 72 per cent of the people are poor compared to 42 per cent in urban areas.

It stated that about 70 per cent of Nigerians live in rural areas, yet these areas are home to 80 per cent of poor people.

The report pointed out that the North accounted for 65 per cent or 86 million poor Nigerians while 35 per cent or about 47 million people living in poverty reside in the South.

The incidence of multidimensional poverty was high in Sokoto State, which accounted for 96 per cent of poor Nigerians and the lowest incidence of 27 per cent was recorded in Ondo.

In terms of the proportion of poverty and its intensity, the poorest states include Sokoto, Bayelsa, Jigawa, Kebbi, Gombe, and Yobe.

“But we cannot say for sure which of these is the poorest because statistically, their confidence intervals or the range within which the true value falls considering the sample overlap, ” the report noted.

The report, among other things, said two-thirds of children aged 0-17 are poor and accounted for 65 per cent compared to 58.7 per cent of adults,  adding that “This gives rise to the sobering reality that over half of all poor people are children”.

The report also stated that the incidence of monetary poverty is lower than the incidence of multidimensional poverty across most states.

It pointed out that the incidence of national monetary poverty stood at 40 per cent in 2018/2019, compared to 63 per cent who are multi-dimensionally poor in 2022.

The report also noted that 29 per cent of all school-aged children are not attending school while 94 per cent of all out-of-school children are poor.

The report, among other recommendations, urged the government to set child poverty reduction as a top national priority.

The survey further stated that “While the COVID-19 regulatory measures implemented in Nigeria helped to control the spread of the virus, many of these necessary and lifesaving measures had deleterious effects on livelihoods, health, human wellbeing, state-society relations, and social harmony.

“The Nigerian economy has grown post-COVID, with the real Gross Domestic Product (GDP) growth rate rising from -1.92 per cent in 2020 to +3.40 per cent in 2021.

“Despite this economic recovery, the lingering impact of the 2020 recession has undermined household welfare and exacerbated poverty and vulnerability.”

Also speaking to THISDAY on the poverty report, Managing Director/Chief Executive, SD&D Capital Management Limited, Mr. Idakolo Gbolade, said the government’s economic policies had contributed to rising poverty.

He said there is high unemployment and underemployment, consistent food inflation, insecurity, and a weaker Naira, adding that all these indices point directly to increasing poverty in the country.

Golade said, “The federal government should tackle the issue of poverty through genuine empowerment in the areas of agriculture, SMEs, technology, and innovation to increase productivity which will in turn resuscitate the economy and reduce unemployment.  The youth population we have in Nigeria is an engine room for growth if properly utilized.

“Money needs to be directed in the right direction and cogent policy implementation needs to be pursued so that we can get value for money.

“The social safety net programme cannot lift Nigerians out of poverty. According to the government, the plan to lift 100 million Nigerians out of poverty has not worked but it has instead dragged more Nigerians (about 133 million) into severe economically induced poverty.

“The ministry supervising the programmes has not also come up with statistics to show progress or how they intend to make progress going forward.”