Many countries in the world are facing the challenge of inequality and Nigeria is no exception to its negative manifestations. It has become a topical issue in these days of poverty in the midst of plenty where Nigeria’s long decade of economic growth did not translate to improved living conditions for the majority. Inequality is not a given; it does not just happen. It is a product of the economic, social and political policy decisions and choices made by the state and citizens. Although policies are ostensibly formulated to be neutral, economic, fiscal and monetary policies are not neutral. The rich opportune class in society benefits more and extant policies fail to address the specific rights and needs of women, the girl child, youths and the vulnerable.
According to Pope Francis in Apostolic Exhortation, Vatican Evangelii Gaudium, 2014 and Christine Lagarde, IMF at 70: Making the Rights Choices -Yesterday, Today and Tomorrow, reducing inequality is not only a moral imperative, it is good economics as well. Budgets are essential instruments for the reduction of inequality. Budgets are presented as aggregate figures without reference to men and women, boys and girls, poor, vulnerable or rich. Essentially, it is portrayed as a neutral economic instrument. This leads to what has been described as gender, youth, inequality and vulnerability blindness in budget and policy formulation, implementation, monitoring and evaluation.
It is a fact of life that formal guarantees of equality in law and policy make no meaning when substantial and structural inequalities prevent sections of the society from accessing services in a non-discriminatory way. Economic, fiscal and monetary policies need to be customised to combine growth with jobs, reduce inequality and poverty and address the specific challenges of women, youths and the vulnerable and marginalised groups. The fact is that inclusive economies that seek to reduce inequality hold more potential for growth and, inequality is a pre-condition for economic stagnation. More opportunities for improvements in education and voice also provide a fertile ground for innovation especially if the energy and potential of youths and women are tapped for development. An inclusive economy is also more likely to lead to stability and reduce the risks of fragility that lead to recessions and downturns. Citizens’ solidarity and popular participation, where all participate in baking the national cake, and also benefit from its dividends strengthens good governance and development. Beyond economic policy, a focus on education, social inclusion and giving the vulnerable a voice will provide the founding blocks for reduction of inequality.
Despite a number of sunshine laws including Fiscal Responsibility, Public Procurement and Freedom of Information Acts, the fiscal environment is still opaque leading to reduced accountability and value for money from federal and state governments’ spending. The combination of opaque practices and unequal economic protection leads to reduced opportunities for women and youths in education, employment and other sectors of social and economic life.
It has therefore become imperative for government and think tanks to conduct research and collaborate to design and provide evidence for inclusive alternative policy frameworks that will mainstream the voice of the vulnerable, women and youths in fiscal policy and address their strategic needs; engage policymakers with smart policies to promote transparency and accountability. This will provide the basis for rational planning, policy change; evidence led budgeting and budget credibility. Essentially, it is a process that seeks to ensure equitable benefits from natural and other public resources for all segments of society. This will involve new ways of programming which redefines and expands beneficiaries and target groups.
The new framework is anchored on the aphorism that budgets affect men and women, the youths and different segments of society differently because of their respective roles, contributions, absorptive capacities and societal expectations. Coming against the background of the decline in oil price and reduced revenue for government, it is imperative that strategic steps be taken in accordance with Nigeria’s obligations under international human rights law to secure minimum core subsistence rights for vulnerable groups. In these times of severe resource constraints, special measures need to be taken to protect vulnerable groups and ensure that they access the resources needed to maintain an adequate standard of living.
Nigeria is at a crossroads and needs to take effective decisions on its next fiscal and economic steps. The petrodollar boom is over as commodity prices have collapsed. Hard choices need to be made on how to expend the little available resources and new sources of generating revenue. These choices according to Lagarde are between acceleration and stagnation, stability and fragility and the quest for social solidarity.
Buoyed by petrodollars, the Nigerian economy grew at an average of six per cent for over a decade up to the first quarter of 2015. The foreign reserves, as of 2008 stood at $60bn whilst the Excess Crude Account had $20bn. The naira was stable compared to other foreign currencies and exchanged at N150 to the United States dollar. However, the current statistics indicate that our foreign currency reserve has just climbed to $30billion and the naira exchanges for about N400 to $1. Headline inflation has breached the single digit rule to about 18 per cent; real Gross Domestic Product growth has slowed as we have yet to get out of the recession.
The period of growth witnessed increased inequality, exclusion and poverty reduction was not commensurate with economic growth. It was a jobless growth from enclave transactions in the oil and gas sector. The National Bureau of Statistics reports that throughout the growth period, high unemployed and under-employed for all segments especially for women and youths were the norm. This in effect means that opportunities for access to income generating and livelihood support activities were and are still fewer for women and youths. The decade of growth did not lead to improved education outcomes as Nigeria still retained 10.5 million children out of school; maternal and child health stagnated and the housing deficit increased to about 20 million units. Female enrolment in schools and educational accomplishment did not reflect the improved economic growth. It is bound to further decline with reduced public spending in education.
Opportunities for mainstreaming the voice and participation of marginalised groups like women and the youths were muscled out by the mainstream and exclusionary narrative of male-dominated society. Even the little progress made in women’s participation in governance (appointed and elective positions at the federal level) between 2011 and early 2015 have been rolled back after the 2015 elections. On the part of the youths, they have been mere spectators in the governance process.
The time has therefore arrived for a new thought process and framework for action that galvanises the energy of all towards baking the national cake whilst also providing opportunities for everyone to participate in the cake sharing. Using a fewer number of cylinders when more is available is not the fast route to economic growth and prosperity.