November 17, 2023/CSL Research
A Punch news report yesterday says the World bank has disbursed c.US$300 million to Nigeria from the US$800 million approved for Nigeria’s National Social Safety Net Program-Scale Up. The fund was approved by the World Bank on 16 December 2021.
The first repayment of the loan will be due by 15 January 2027, and the last repayment due by 15 July 2051. In October 2023, President Bola Tinubu formally launched the promised conditional cash transfer programme which involves transfer of N25,000 monthly for three months to 15 million households nationwide.
The US$800 million approved for Nigeria’s National Social Safety Net Program-Scale Up is to be managed by the Federal Ministry of Humanitarian Affairs & Poverty Alleviation.
With this loan, the Federal Government (FG) plans to run a monthly cash transfer programme for poor and vulnerable Nigerians, who have been hit hard by recent policies such as the fuel subsidy removal. There are news reports that the Federal Government is in touch with consultants to upgrade the social register for the cash transfer program.
We retain our view that cash handouts to the citizens is not a fix to the adverse economic realities facing most Nigerians. Disbursing cash for 3 months to poor household is not a lasting solution to the erosion of purchasing power caused by the increase in petrol price and the associated increase in prices of other goods and services witnessed in the past few months.
Again, the World Bank as of March last year reported that 4 in every 10 Nigerians, out of an estimated 200m people are poor, putting the figure much higher than the targeted 15m. Also, given the way covid palliatives went, it is almost certain that targeting will be a major problem as corruption and paucity of data will most likely lead to exclusion of eligible people and inclusion of non-eligible people in the register.
A better use of government resources in our view will be providing free bus transit, which will certainly be targeted at the poor as the rich will most likely not get on a bus, providing adequate security for farmers, providing infrastructure like storage facilities and providing for easy movement of farm produce from the farms to the point of sale.
The National Bureau of Statistics (NBS), in its National Multidimensional Poverty Index report released in November 2022 revealed that 133 million Nigerians were multi-dimensionally poor. The Multidimensional Poverty Index (MPI), is a measure of acute poverty using a range of indicators such as education, nutrition, child mortality, etc. Clearly, recent policies by the Federal Government have driven those statistics much higher and have worsened the conditions of the poor.
