The 2016 Agenda (1).

Economic hardship and challenges, as presently experienced in Nigeria and in many parts of the world present an opportunity to test our abilities, talents, creativity and adaptability. As the economic conditions of Nigeria change, so are we required to think out of the box and to harness our inherent resources to ride the waves of the tough times. A time like this calls for great and inspirational leadership, social mobilisation and innovation beyond the ordinary. We are therefore called upon to prove that there is life after the collapse of the price of crude oil. However, it must be acknowledged that the present crisis was avoidable or at least, we could have been better prepared for a time like this.
This is not the first time the price of oil declined for a fairly long period and may not be the last. Projecting into the future, the dynamics of change towards sustainability and climate change mitigation and adaptation indicates that fossil fuels may not be the way of the future. New innovations in renewable energy and reduction of carbon footprints indicate that overtime, crude oil will face a phasing out curve. Where does this leave Nigeria’s economy in the near, medium and long term?
The rooms for manoevre in the traditional sense are limited with little or no fiscal buffers, insufficient infrastructure to support growth, manifest income inequality in access to the dividends of the oil economy and poor or largely absent social insurance and benefits system. But in all these, there is glimmer of hope for the present generation of Nigerians to be the generation that will make the sacrifice, to place their shoulders as the launch pad for the next generation of Nigerians to climb on and to be the pillars of a modern Nigeria where value addition and wealth creation devoid of rents take centre stage. It is envisaged as Nigeria rising and maintaining a sustainable and equitable economic growing that carries along the broad spectrum of the population.
This dream is possible if it is founded on a mission and understanding that there is no time to waste and that the work to be done is great. As such, we need all hands and workers to be part of the work day. No one or section of the country should be alienated as we tap the potent and latent energies of all to build a vibrant nation. The first steps should be about leadership dreams; the President and his cabinet should set goals matched with strong political will and resources to achieve the goals. But these goals will need to become the mantra of the ordinary Nigerian; it should be believable with opportunities for all to buy into it. Within the context of building a great Nigeria, everyone should see opportunities for building a great self, family and community of shared prosperity and equal opportunities.
We can start in the 2016 federal, state and local government budgets by cutting down all wastes, frivolities and inappropriate expenditure. The days of having an agriculture budget that plays on the words “seed, seeds and seedlings” should be over. The budget should be focused on three major issues – economic growth, investments in the social sector especially in education and health and starting the roll out of an aggressive social insurance system that will include both the formal and informal sectors of the economy. It is hoped that savings from the full implementation of such policies as the Treasury Single Account, IPPIS, blocking the leaking pipes of the petroleum industry, etc and other fiscal reforms will release resources which will be better programmed for growth. It is also expected that the Federal Inland Revenue Services will be repositioned to collect greater taxes to fund public expenditure. Every Nigerian natural and artificial person should be brought into the tax net at the pain of punishment.
In this direction, FGN should target not less than 30% of the budget for capital expenditure. This will be supplemented by resources from other sources. Prudential guidelines should be drawn up by government on how to use pension funds to kick start big ticket infrastructure projects especially in railways, motor roads, expansion of the electricity transmission grid and ICT. Special purpose vehicles that allow Nigerians of all shades, from institutional to retail investors to be part of the infrastructure revolution should be established. This will require that our President and the relevant ministers draw up sector specific plans with achievable milestones listing the benefits accruing to the society and the investor at the same time. Challenge our people, tell them that we are at the threshold of real economic change; accompany the challenge with honesty of purpose, transparency and accountability and we shall see a new Nigeria that belongs to all.
Access to electricity is so important for economic growth. Specifically, the electricity regulatory authorities need to creatively manage the electricity industry for sustainable improvements in the sector. It is not sufficient to propose to increase tariffs without a concomitant commitment to improve services. If the distribution companies are unable to reduce distribution losses, it means they have not invested enough. Virtually, two years after the privatization exercise, we are still discussing the rudimentary issues such as access to prepaid metres which is a precondition for proper revenue forecasting and collection in the industry. Since the DISCOs do not have the resources to invest, they should look for sustainable investments through opening up to Nigerians on the Stock Exchange. Taking domestic loans at double digit interest rates will not do the job whilst single digit foreign currency denominated loans is totally unrealistic considering the volatility of our naira and the exchange rate risks that accompany repayment of such debts over time.
Still in the real sector, let the President get competent and creative hands to run the National Housing Fund. Let the law be fully implemented and drag every worker and employer in the formal and informal sector to contribute to the Fund. If the Fund had been properly managed since inception in 1992, the current 17million housing deficit would have been history. We would have a Fund that would have accumulated not less than N15trillion and makes available housing loans to majority of Nigerians. The land law is overdue for reforms. Everyone knows what is wrong with the Land Use Act; several committees have submitted reports on the need to amend and remove it from the 1999 Constitution. However, the political will for reforms has been absent and those reports are gathering dust on the shelves.
On no account should we take loans to pay for recurrent expenditure. It is illegal and unlawful under the Fiscal Responsibility Act and it is not sustainable either in the short, medium or long term. Debts should only be incurred for regenerating capital expenditure with a proper cost benefit analysis. Prioritise ongoing capital projects and identify the ones that can best impact on livelihoods, jobs creation and reduction of inequality; complete them within a record time of one to two years before staring new ones. For instance, in roads, FGN should ask governors and federal legislators to agree at the level of geopolitical zones, the most important roads that can be completed with the limited available resources instead of spreading the resources so thin.
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