By Eze Onyekpere

The recent media briefing by the Minister of Finance, Dr. Ngozi Okonjo-Iweala, who coordinates the Economic Management Team of the Federal Government on the key priorities of government calls for a critical review and analysis. The key areas identified by the minister are infrastructure, focusing on the completion of essential on-going projects; security of life and property; agriculture and food security; housing; education; health; investments in oil and gas; entertainment and fiscal reforms. Improvements in these sectors are expected to revamp the economy by creating a conducive and competitive environment, improve production and value creation and ultimately lead to enhanced employment. Essentially, it seeks to create an employment laden growth pattern.

It is a welcome development that the minister did not attempt to draw up a new economic blueprint. She sought to implement the Vision 2020 blueprint of the administration. With the exception of the fiscal agenda, which has a few details, most of the retooling she announced was general in nature. Thus, the challenge will be in the details of the implementation agenda.

Starting from the fiscal agenda, it is imperative that the deficit be kept below three per cent of the GDP in accordance with the Fiscal Responsibility Act. However, the projection that the recurrent expenditure will be reduced from 74 per cent to 70 per cent of the budget, a mere four per cent reduction lacks ambition. The National Economic Empowerment and Development Strategy implemented by the Obasanjo administration between 2004 and 2007 had set the target at 60-40 for recurrent and capital expenditure. Four years down the line in 2011, setting the target at 70-30 is not the way of reforms.

There is evidence that the 60-40 balance can be attained if targeted steps are taken by the administration. The Federal Government had set up a committee to restructure and rationalise government parastatals and agencies. If the committee properly works on its mandate, it is expected that the implementation of its report will lead to a reduction in the recurrent expenditure of the administration. Further, if the minister looks in-between the lines, she will discover a lot of illegal and frivolous expenditure in the MDAs. She will discover packages such as ‘welfare’, running into tens of billions of naira. She will further discover officers who, after benefitting from government’s monetisation policy, continue to suffer the treasury to pay for their benefits. Even the use of energy saving lighting and devices in all government offices will cut down expenditure.

The minister stated that Nigeria’s $40bn debt is 17.5 per cent of our GDP, indirectly implying that Nigeria is under-borrowed. However, such heavy borrowing at a time of high oil prices and a good deal of it going to fund recurrent expenditure, is not sustainable from the economic and social viewpoints. The government is not in a position to pin-point the exact projects where $40bn, translating into more than N6tn was invested. I agree with the minister that we should reduce domestic borrowing, but that should not be an excuse to resume excessive foreign borrowing.

The focus on infrastructure should ensure that Nigeria optimises resource use and utilises the energies and capacities of her citizens. Power sector reform is currently on the front burner of national discourse. The reforms should be pursued with all the available vigour and rigour. Delays should be avoided and timelines should be met. Already, we are behind schedule in the implementation of the presidential road map on power sector reforms.

The whole value chain approach introduced into agricultural funding and reform should be implemented to the letter. The findings of local research institutions should be utilised to add value to agricultural production, preservation, processing and marketing. The same value chain approach should also be used to grow the entertainment industry. Single digit funding should be made available; production quality of music, films, etc, improved; regional and international markets developed and expanded; and intellectual property laws enforced.

It is apparent that public resources are so thinly spread in national budgets for infrastructure, including roads. A situation where every budget comes with provisions for over 100 roads in a year while at the end of the year, none will be completed is a sure way to waste resources. It is imperative to rationalise the number of such roads that are funded in a year, with a moratorium on new projects except they can be justified under exceptional circumstances. The establishment of the proposed road fund should be a priority for the administration.

The administration should also optimise public private partnerships with credible investors who have the technical, financial and managerial expertise to invest in green-field infrastructure or resuscitate existing dilapidated ones.

In the housing sector, government should recognise that it has a basic obligation to house its citizens. However, the market and private capital can be deployed in providing housing. Proceeding from this, policies to reduce the cost of access to housing should be devised. This will include the establishment of a special fund to boost the work of the Federal Mortgage Bank and Primary Mortgage Institutions. Through this way, resources available under the National Housing Fund will be increased and bureaucratic tapes restricting popular access to the fund should be reduced.

If the effectiveness of the system improves through the delivery of more houses, more individuals in the formal and informal sectors of the economy will be willing to contribute to the fund. The fund can grow as big as funds currently managed under the reformed pension law.

Investment in education should focus on improving its quality. A situation where academic institutions dole out certificates to functional illiterates and persons without skills will retard societal progress. The educated Nigerian of this generation should have the capacity to contribute to society while expecting a just reward. For health, my simple take is for the EMT to recommend to the Federal Executive Council a policy that bars public officers from seeking medical treatment abroad at public expense. This would spur the authorities to invest more time and resources to reposition the health sector. The National Health Insurance Scheme should be expanded to cover persons in the informal sector of the economy and the poor and vulnerable segments of society.

To achieve the desired results, there is the need for enhanced cooperation between the executive and the legislature. The implication is the EMT will liaise with the leadership of the legislature to identify priority legislation needed for the reform agenda. The bills for the reform laws will be prioritised in the legislature. The Petroleum Industry Reform Bill will be one of such priorities. It is also imperative that the EMT engages the legislature in budgetary discussions early in the year during the preparation of the executive budget.

The major challenge in achieving transformation will not be the lack of resources; it will be the lack of political will to effect change. What is needed is creativity and to demand more efficiency of resource use from spending agencies. They should get more results out of current expenditure. There is also the need for enhanced transparency and accountability in governance. Government must go out of the way to sensitise the public on its developmental agenda. The contents of Vision 2020 blueprint, for example, is unknown to Nigerians outside government circles. Citizens should be made to know their obligations and rights that will lead to the achievement of the vision.

Onyekpere is the lead director, Centre for Social Justice: censoj@gmail.com

Source: Punch