ABSTRACT
It is both a
truism that no nation develops beyond the capacity of its public service, and
there is broad consensus amongst Nigerians that our public service is broken
and dysfunctional. The quality of public servants and the services they provide
to our nation are both below expectations. From the glorious days at
independence when the best and brightest graduates competed to join the
administrative service up until 1970s, our public service is now seen as
employer of the dull, the lazy and the venal. We need to retrieve our old
public service – effective, well paid and largely meritocratic, attracting
bright people imbibed with a spirit of promoting public good.
The Nigerian civil
service evolved from the colonial service with its historical British roots of
an independent, non-political and meritocratic administrative machinery for
governing the country. Each region then had its civil service in addition to
the federal service.
What is the public
service? How did our public evolve from inception to excellence and now its
current abysmal state of ineffectiveness? How can the public service be
reformed, re-skilled and right-sized to provide the basic social services that
will earn the trust of Nigerians and foreigners alike?
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INTRODUCTION
From the
inception of the administration of President Olusegun Obasanjo in May 1999 till
its exit in May 2007, a lot of reforms were initiated to ameliorate the socio-political,
economic and institutional decay that the nation has witnessed over the years.
Given that the sustainability or otherwise of any government policy depends
largely on those that implement it and because the success or failure of such
policy lies on how favourably disposed the public servants are to make it work,
the administration therefore deemed it necessary to introduce reforms that
would revitalise the public sector with a view to adequately empowering it to
sustain the reforms (Ugwu-olo 2007:56).
The public
service is an indispensable instrument through which the government implements
its policies and programmes. It is through its instrumentality that government
policies are translated into services for the people. The public service is
made up of the employees of government.
They are those
responsible for the functioning of government through the implementation of
government policies. The main functions of the public service are essentially
to help formulate and implement the policies of government and to render
related services to the public. The public service, made up of workers in
government ministries, parastatals and other agencies, are further expected to
provide continuity in governance, and to serve as a repository of knowledge and
experience of the practices and procedures of governance, and to protect public
interest (National
Political Reform
Conference 2005). Such policies include welfare services rendered to the
citizens.
Within the
public service is the civil service which constitutes the inner core, or the
heart of the public service (Anifowose and Enemuo 1999:278-279). Civil service
can thus be defined as a well organised body of permanent paid officials of
ministries and departments under the executive arm of government, charged with
the responsibility of implementing government policies and programmes in
accordance with laid-down rules and procedures (Anifowose and Enemuo op.
cit:279).
There is no
doubt that the Nigerian public service has been afflicted over the years with a
series of problems, among which are poor performance, corruption, absenteeism
and the ghost workers syndrome. Considering these malaise that have
characterised the public service as well as the need to reposition it to make
it people-oriented and compatible with the realities of global standard,
President Olusegun Obasanjo approved the establishment of Bureau for Public
Service Reforms (BPSR). The bureau was mandated to streamline and standardise
the public service at the federal level, including setting minimum standards to
be met by each ministry or agency. The task was ‘to build a civil service that
is performance and result oriented, professional and technologically sensitive,
and committed to a continuous improvement in the conduct of government business
and the enhancement of national productivity’ (Ajayi 2006:4). The core thrust
of the Federal Government position, Ajayi explains further, was to ‘reposition
and re-professionalise the public service for greater efficiency, effectiveness
in service delivery, accountability, transparency, and overall national
productivity’ (Ajayi op. cit:5).
This chapter
attempts a critical review of the dimensions and consequences of these reform
packages which have been sources of public outcry across the country, with a
view to determining their efficacy.
Public Sector
Reforms in Nigeria: A Historical Overview
The British
colonial public administration which managed the colonial territory known as
Nigeria, from about 1861 to 1954, when regional governments were created,
influenced the growth and development of the public services in Nigeria.
Consequently, the public services of the
then regional
governments from 1954 to 1960, the year of independence, and up to 1966, were
direct offshoots of the British colonial public service administrative
structure; in terms of ethics, values, culture and tradition, training,
procedures and espirit de corps. During this period, there were five
public services, namely; the Federal Public Service, the Public Services of the
Eastern Region, the Northern Region, the Mid-Western Region and that of the
Western Region. The first reform of the civil service was undertaken in 1946 by
the Harragin Commission, which divided the service into Junior and Senior
services. It was followed by the Gorsuch Commission of 1954, which restructured
the service into five (5) sections, which are: the sub-clerical, clerical,
sub-professional/technical, administrative / professional, and super-scale. The
Mbanefo Commission
of 1959 was
concerned mainly with the issue of salaries and this was followed the same year
by the Hewn Commission which integrated the existing departments under
Directors into ministries to be headed by Permanent Secretaries (Adebayo
2004:212). The next reforms in the civil service, which looked mainly at the
issue of salaries, were undertaken by the Morgan Commission in 1963, the Elliot
Grading Team of 1966 and the Adebo Commission of 1970. Considering the ugly
trend of failed policies and poor performance that had characterised the Nigerian
polity over the years, a number of efforts were made towards reforming and
revitalising the Nigerian public services, with a view to building a public
service whose work is development, result- and people-oriented.
It was against
this background, at the end of the Nigeria civil war in 1970, that the Yakubu
Gowon government set up the Udoji Commission to, among other things, harmonise
the structure and organisation of the public service of Nigeria. In 1974, the
Udoji Commission recommended
a result-oriented
and unified structure of public service for the whole country. This implies
that recruitment/appointment, promotion, remuneration, retirement, discipline
and dismissal would thereafter be governed by the same conditions all over the
country (PSRC 1974:279).
Shortly after,
in 1975, General Murtala Mohammed inaugurated the Public Service Commission
(Disciplinary Proceedings), and immediately purged the civil service of those
it considered not useful (Adebayo 2004:177).
This severe
disciplinary action, according to Adamolekun (2000:120), was based on such
grounds as ‘abuse of office’, ‘decline in productivity’, ‘divided loyalty’,
‘old age’, and ‘corruption’.
In 1988, it was
the turn of General Ibrahim Babangida to initiate his own reforms. He
constituted the Philips Civil Service Review Panel which, according to the
government, was aimed at streamlining the public service along the lines of the
presidential system of government, with the purpose of making the public
service responsive to the Structural Adjustment Programme (SAP). One of the
recommendations of the review was that professional heads of ministries be
called Directors- General (DG) instead of Permanent Secretaries. The review
also recommended specialisation in the ministry where an officer found himself.
The appointment of the DG became political and they were required to retire
with the president who appointed them (FCSRP 1988:279; Adebayo 2004:108).
Another review
of the public service was undertaken by the Allison Ayida Panel on Civil
Service Reforms, under the late General Sani Abacha in 1995. The panel examined
the 1988 reforms and suggested far-reaching changes. Based on the panel’s
recommendation, the Provisional Ruling
Council (PRC)
directed that the post of DG should revert back to the status of Permanent
Secretary and should be the accounting officer of the ministry (FRN 1997:280).
The reforms went to the roots of the ills militating against efficiency and
devotion to duty in the service.
The latest
review of the public service was the one undertaken by the Obasanjo
administration, with the establishment of the Bureau for Public Service Reform
(BPSR) to, among other things, streamline and set a minimum standard in terms
of staff strength and remuneration for the public service. According to HTSPE,
an international consultancy company which worked in partnership with the
Federal Government on the reform programmes, the public service reforms of the
Obasanjo administration was an exercise embarked upon to, among other things,
tackle pay roll fraud, remove ghost workers and the large number of redundant
posts, facilitate a process of organisational restructuring, improve service
delivery standards, and facilitate a process of pay reform that will provide
incentives for quality staff to come into the service and stay there (HTSPE
2007:1). The shapes, patterns and dimensions of these reforms, which have been
the subject of heated debates among many public policy commentators and the
generality of the Nigerian populace, is the main focus of this chapter, and
shall be elaborated upon in the subsequent sections.
Since
independence, the Nigerian public service has been subjected to very many
reforms. However, changes of government, styles of government and policies have
meant that no single policy had the chance of making the necessary impact
before a new policy direction was introduced by the succeeding
administration/regime (National Political Reform Conference 2005:184). To make
matters worse, Nigeria had the misfortune of suffering prolonged periods of
military rule whose styles tended to disrupt and dislodge civil service rules,
procedures and practices.
A good example
here was the mass purge of the civil service by the Murtala Mohammed regime,
where none of those affected, from messenger to head of civil service, was
given any chance to defend him/herself, which is contrary to the service
disciplinary procedure. This, Adamolekun
contends,
underscored the arbitrariness of the exercise. Gone, he further argues, was the
protective shield that existed during the 1960-66 period, which earned the
civil service institution the enviable title of being the country’s ‘one real
achievement since independence’ (Adamolekun
2000:120).
The military
regimes breached and stifled the essential principles of federalism in Nigeria;
making public administration approximated to a system of unitary form of
government. The result was that security of tenure of civil servants was no
longer assured while the collective experience, knowledge, continuity and
ethics were seriously undermined. Another problem was that most of the reforms
in the public/civil sector of the Nigerian economy were initiated externally
and not based on inhouse
evaluation of
the Nigerian situation. Another shortcoming of allm these reforms is the too
frequent politicisation of the top echelon of the Nigerian civil service. This
politicisation, according to Adebayo (2000), led to a relationship of acrimony
and antagonism rather than a partnership in an enterprise; resulting in low
morale in the civil service and consequent low productivity, with a resultant
lack of teamwork necessary in modern management. We can then conclude that the
resultant negative effects of all the reforms on the Nigerian civil service was
that inadequate attention was paid to ensure the healthy growth of the
institution; transforming it from an effective and dependable institution into
a broken down and failed institution.
FERDERAL GOVERNMENT REFOMED AGENDA (FROM 1999 TO 2007)
The
economic philosophy of the present Federal Government is hinged on the market:
“that government has no business in business”. Therefore, all the existing
government projects, plants, enterprises, refineries and shareholdings in
industries, trade, banking, finance and agriculture must be privatised and
sold, so that government, particularly the Federal Government, can concentrate
on governance, forgetting that a government that cannot run an industry
successfully cannot govern efficiently. So, the Bureau of Public Enterprises
(BPE) has been very active, since the present regime came on board on May 29,
1999, in selling off enterprises, including houses and other landed properties
owned by the Government. Such a philosophy violates the Nigerian Constitution
not only by abandoning the control of the major sectors of the Nigerian economy
but also by offering Nigeria for sale to domestic and foreign private interests
and concerns.
1999
Constitution and the Privatisation Orgy
(i) Chapter 1,
Part 1, Article 3, of the 1999 Constitution of Nigeria provides that, if other
law is inconsistent with the provisions of the Constitution, the Constitution
shall prevail, and that law shall to the extent of the inconsistency be void.
(ii) Chapter II
of the Constitution contains the FUNDAMENTAL OBJECTIVES AND DIRECTIVE
PRINCIPLES OF STATE POLICY
(iii) Article
16(1) of Chapter II provides that, “The state shall, within the context
of the ideals and objectives for which provisions are made in this
Constitution”
16 (1) (a) “harness
the resources of the nation and promote national prosperity and an
efficient, a dynamic and self-reliant economy”
(b) “control
the national economy in such a manner as to secure the maximum welfare,
freedom and happiness of every citizen on the basis of social justice
and equality of status and opportunity”.
(c) “without
prejudice to its right to operate or participate in areas of the economy, other
than the major sectors of the economy, the state shall manage and
operate the major sectors of the economy”.
(d) “without
prejudice to the right of any person to participate in areas of the economy
within the major sectors of the economy, the state shall protect the right of
every citizen to engage in any economic activities outside the major sectors
of the economy”.
16(2)
The State shall direct its policy towards ensuring;
16(a) “the promotion of
a planned and balanced economic development”. There is no planned economic
development today of 4-year, 5-year – 10-year or 25-year Development Plan, as
was the case between 1946 and 1985. Planning the economy of Nigeria ceased when
the Babangida Regime introduced the IMF-World Bank imposed Structural
Adjustment Programme (SAP) in 1986. Economic planlessness has been more greatly
emphasised, since 1999, in deregulation, privatisation, down-sizing of the
public service and reform agenda of the Obasanjo regime. The present regime
seeks to ensure the continuation of planlessness on the nation through a
succeeding surrogate regime by getting the PDP be re-elected at all costs in
the general elections of April 14 and April 21, 2007.
Article 16(b) of the
1999 Constitution provides also: that, “the material resources of the nation
are harnessed and distributed as best as possible to serve the common good”,
while Article 16(c) provides that, “the economic system is not operated in such
a manner as to permit the concentration of wealth or the means of production
and exchange in the hands of a few individuals or of a group”.
The
on-going privatisation of public enterprises and their sale to a few privileged
Nigerians and foreigners are violations of these noble and unambiguous
provisions of the 1999 Constitution. The destruction of the houses of Nigerians
in the Federal Capital Territory, Abuja, and the sale of the Federal Government
houses, nationwide, in which many civil servants, parliamentarians and other
Nigerian citizens live, without providing the affected citizens with
alternative accommodation is also a violation of the provision of Article 16,
Section 2(d) of Nigeria’s Constitution, which provides that, “suitable and
adequate shelter shall be provided for all citizens of Nigeria”. Also, the
reversal of the pension benefits of public servants and the deduction from
their monthly wages for pensions, in place of the earlier non-contributory
pensions; the non-payment of pensions and gratuities, as and when due; the
retrenchment and retirement of public servants; the non-creation of employment
opportunities and the non-payment of unemployment benefits to those forced into
unemployment, are violations of the same Article 16, Section 2(d) of the
Constitution, which further provides that, “suitable and adequate food,
reasonable national minimum living wage, old age care and pensions and
unemployment benefits, sick benefits, and welfare of the disabled shall be
provided for all citizens of Nigeria. The enforcement of contributory pension
scheme on public servants already in the public service, in the name of pension
reform, is a violation of Article 173 of the Constitution, which protects the
existing pension rights of public servants
DERELICTION
OF RESPONSIBILITY BY THE NATIONAL ASSEMBLY, SINCE 1999, WITH RESPECT TO THE
ECONOMIC WELFARE OF NIGERIANS
In
order to protect the economy from being operated against the collective
interest of Nigerians, by a dominant minority, Section 4 of Article 16 of the
Constitution provides that, “ the major sectors of the economy, to be managed
by the State, shall be construed as reference to such economic activities as
may, from time to time BE DECLARED BY A RESOLUTION OF EACH HOUSE OF THE
NATIONAL ASSEMBLY TO BE MANAGED AND OPERATED EXCLUSIVELY BY THE GOVERNMENT OF
THE FEDERATION, and until a resolution to the contrary is made by the National
Assembly, Economic ACTIVITIES BEING OPERATED EXCLUSIVELY BY THE GOVERNMENT OF
THE FEDERATION ON THE DATE IMMEDIATELY PRECEEDING THE DAY WHEN THIS SECTION
COMES INTO FORCE, WHETHER DIRECTLY OR THROUGH THE AGENCIES OF A STATUTORY
OR OTHER CORPORATION OR COMPANY, SHALL BE DEEMED TO BE THE MAJOR SECTORS OF THE
ECONOMY”.
It
is obvious that the on-going privatisation of the enterprises of government
also violates this provision, since neither or both of the Houses of the
Nigerian National Assembly have acted in consonance with this section, inspite of
the BPE Act No. 4, enacted by the National Assembly in 2002. Nigerians should
continue to shout that the on-going privatisation policy of the Federal
Government is a violation of all the relevant provisions of the 1999
Constitution, with respect to the management and control of the Nigerian
Economy.
STATE
AND LOCAL GOVERNMENTS AND ECONOMIC PLANNING
In
order to ensure that not only the National Assembly but also the States Houses
of Assembly and the Local Government Councils participate in the planning and
in the control of the nation’s economy, Article 7(3) of the 1999 Constitution
(on Local Government system) provides that, “ it shall be the duty of a Local
Government Council within the State to participate in economic planning and
development of the area, and to this end an economic planning board shall be
established by a Law enacted by the House of Assembly of the State”. No Local
Government Council in Nigeria, since 1999, to my knowledge, has established a
Planning Board or has participated in economic planning of its State! Also, no
State House of Assembly has enacted any law for that purpose. On the other
hand, all that we are fed with daily by the reformist Federal Government is
that government has no role in the economy and that rather than plan, it is the
market and the private enterprises that should plan and develop the Nigerian
economy and grow it to become one of the largest 20 economies in the world by
2020!
Monetisation of
Fringe Benefits
Monetisation is
the process of converting or established something into,legal tender. It may
also refer to selling a possession, charging for something used to be free or
making money on goods and services that were previously unprofitable (Wikipedia
2007:1). These benefits-in-kind, largely a
carryover from
the colonial era, include highly subsidised residential accommodation,
transport facilities, chauffeur-driven motor vehicles (for the senior echelon
of the service), free medical services and highly subsidised utilities such as
electricity, potable water and telephone. The cost of providing these amenities
to public servants has become so huge vis-à-vis other provisions in the annual
appropriations that little was left for funding capital projects, government
claimed. The problem was further compounded by the fact that these benefits
were largely not provided in
the most
cost-effective manner (Nnebi 2006:265).
The Federal
Government further argued that its decision to adopt the policy of monetisation
of fringe benefits is designed to stem the everrising annual expenditure outlay
on the benefits provided for public servants, thus reducing waste and releasing
resources for the provision of social and economic capital assets for the wider
populace. It made quite a number of them, it claimed, to develop a dependency
syndrome ill-suited to post-retirement life. Thus, among other benefits,
government believed, monetisation would help prepare public servants for life
after retirement
by preventing a
sharp drop in their standard of living following their retirement, compared to
when they were in active service. It would also encourage public servants to be
more flexible in the use of their resources, choosing whether to live in their
own or rented houses, for example (Public
service Reforms
and National Transformation 2006:54). The policy, larger cities, especially
Abuja, seat of the Federal Government, where the rent on leased properties is
expected to fall as government stops leasing houses for its workers. In fact,
government itself would release a number
of houses owned
by it into the market, thereby putting a downward pressure on prices in the
real estate market, if not in the short term, at least in the medium to long
term (Nnebe 2006:266).
The monetisation
policy was given legal teeth with the passage and coming into effect of the
Certain Political, Public and Judicial Office Holders (Salaries and Allowances,
etc.) Act, 2002 which has now been extended by circular to cover all federal
civil servants. The law took effect from 1 July 2003 for the designated political,
public and judicial office holders contained therein, while it was extended,
with somewhat modified rates of benefits, to federal civil servants with effect
from 1 October
2003 (Nnebe
2006:266).
Pension Reform
Up to 2004 when
the Pension Act was passed by the National Assembly, the government operated an
unfunded Defined Benefits Scheme and the payment of retirement benefits was
budgeted annually under the Pay-As- You-Go Benefit Scheme. Against the claimed
backdrop of an estimated
N2 trillion deficit,
arbitrary increases in salaries and pensions as well as poor administration;
the Obasanjo government initiated a pension reform in order to address and
eliminate the problems associated with the pension schemes. The new pension
scheme is contributory, fully funded by both
the employer and
employee and based on individual accounts that are privately managed by Pension
Fund Administrators (PFAs), with the Pension Fund Custodians (PACs). This whole
scheme is being regulated and supervised by the National Pension Commission
(PenCom). The Commission will ensure that the payment and remittance of
contributions are made and beneficiaries of retirement savings are paid when
due (Public service Reforms and National Transformation, 2006:56-57).
EDUCATION AND THE FEDERAL GOVERNMENT
The
disregard of the Nigerian Constitution is not only with respect to the physical
economy but also with respect to the education sphere. Article 18 of the
Constitution provides for the Educational Objectives of the country. In this
regard, Article 18, Section 3, provides that, Government shall strive to
eradicate illiteracy and to this end, Government shall, as and when
practicable, provide:
(a) free
compulsory and universal primary education
(b) free
secondary education
(c) free
university education
(d) free
adult literacy programme
Instead
of working towards making education free at all levels, the Federal government
plans to privatise all its hitherto owned, financed and managed Federal
Government Unity Secondary Schools under a dubious public-private partnership
(PPP) administration through which it seeks to reduce the Federal Government
financial and administrative commitments to the Unity Secondary School.
Instead, government should be grant-aiding the existing privately owned primary
and secondary schools, so as to reduce their costs to the youths of Nigeria.
Furthermore, the Federal government and the National Universities Commission
(NUC) continue to license private universities, including those owned by the
President, the Vice President and the leading members of the government and
their business partners. These private universities will charge, and are
charging, exorbitant fees, thus making education at the university level, as in
the primary and in the secondary school levels, less and less free and more and
more expensive so as to make education available to a decreasing percentage of
the Nigerian population. The Public Private Partnership proposal of the Federal
Ministry of Education is thus not only a violation of the provisions of Article
18(3) of Nigeria’s 1999 Constitution but also a disservice to the present and
the future youth of Nigeria.
DENIAL OF FUNDAMENTAL RIGHTS OF NIGERIANS
Chapter
IV, Articles 33-43 of the 1999 Constitution, provide for the Fundamental Rights
of Nigerians, that is, the:
(i) Right
to life (33)
(ii) Right
to dignity of the human person (34)
(iii) Right
to personal liberty (35)
(iv) Right
to fair fearing (36)
(v) Right
to private and family life (37)
(vi) Right
to freedom of thought, conscience and religion (38)
(vii) Right
to freedom of expression and the press (39)
(viii) Right
to peaceful assembly and association (40)
(ix) Right
to freedom of movement (41)
(x) Right
to freedom from discrimination (42)
(xi) Right
to acquire and own immovable property anywhere in Nigeria (43)
All
of these rights have not been adequately promoted and protected by the Nigerian
government since 1999. Innocent Nigerians have been killed in their own homes,
on the roads, in assemblies, and in their work places more than at any other
peaceful and democratic time in our nation’s history. Nigerians have been
denied their rights of peaceful assembly. Economic, Financial and legal
agencies of Government have been used to harass innocent Nigerians on discriminatory
bases and for not belonging to the ruling political parties or to the section
of the ruling political parties that is a crony of the government. Properties
acquired in other parts of Nigeria by Nigerians had been destroyed by
government agencies, under the nebulous pretence that they violated plans made
many years ago, but which were unknown to Nigerians. Fair hearings had been
denied to public officers who had been arbitrarily retrenched, retired or
dismissed. Politicians, including parliamentarians and governors, had been
removed unjustly or impeached unconstitutionally because they refused to
kow-tow to the whims and caprices of the ruling elite. Press barons had been
killed or their premises burnt because they held and expressed opinions different
from those of the ruling elite. Nigerians have been persecuted and are being
persecuted and their freedom restricted. They have been threatened with arrest
and detention because they did not, and do not, become a puppet of the ruling
elite. Towns and villages had been bombed and razed to the ground, because
their leaders expressed opinions different from those running the government.
Because of the unconstitutional behaviour and the neglect of the government to
cater for the welfare of Nigerians, the nation has become seized by miscreants
who have constituted themselves as dangers on our highways, in our own homes,
to our banks and even to our foreign visitors, workers and investors who are
frequently held as hostages. The non-respect for the Constitution of Nigeria
has become the regular behaviour of the ruling elite. These should not continue
to be so in a democratic Nigeria, governed under the provisions of the 1999
Constitution.
NEO-COLONIALISM AND THE FEDERAL GOVERNMENT
The
majority of Nigerians supported the emergence of President Olusegun Obasanjo
and the PDP into the governance of Nigeria in 1999, partly because of the
assumed nationalistic stance and achievements of General Obasanjo, as the
Military Head of State during 1976-79. His 1976-79 regime championed the
freedom from colonialism of many African countries, particularly of South
Africa, Zimbabwe, Mozambique, Namibia, etc, with money, men and materials.
Nigeria became the haven for freedom fighters in Africa. The 1976-79 regime nationalised
the British Petroleum Company (BP) and renamed it. African Petroleum Company
(AP). It nationalised land by passing the Land Use Decree. It passed the
Indigenisation Decree by which Nigerians became the managers of not only the
commanding heights of the nation’s economy but also it provided Nigerians with
the wherewithal to manage and promote small and medium enterprises. It
established the Bank of Commerce and Industries (BOI), and the Nigerian
industrial Development Bank (NIDB). The Regime initiated legislation for the
establishment of more Commercial and Merchant Banks, which later regimes
imitated to increase the number of banks from 21 in 1979 to 90 in 1999. The
regime championed the establishment of the second Port Harcourt Refinery; the
Kaduna Refinery and the Warri Refinery, which led to the increase in the number
of refineries from one in 1976 to four by 1983. Through these measures and the
planning processes emanating from them, the Nigerian economy grew at an annual
average of 7% during the 1970s until the early 1980s.
However,
since the second coming of General Obasanjo and the PDP regime in 1999, reverse
nationalistic stance has become the order of the day. Rather than pursue
nationalistic economic and political policies to the benefit of Nigerians, the
regime has completely sold out to the Western Imperialistic Nations, to the
extent that Nigeria, today, is less independent, economically and politically,
than it was in 1960 or in 1979. A few examples will suffice.
ECONOMIC DEREGULATION AND PRIVATISATION
The
present regime has completely imbibed the imposition of what has become known,
world-wide, as the “Washington Consensus”, propagated by the World Bank, the
IMF and the Western Imperialist Powers, in order that they will continue to
control and direct the economic policies of countries that have no independent
economic policies of their own.
The
Washington Consensus: The phrase, “Washington Consensus”, is a term in
development policy proposed in 1990 by the Washington-based financial
institutions of the World Bank, the IMF and their subsidiary agencies. It
signifies neo-liberal, neo-colonial, market economic policies which are not
meant to provide an effective framework for combating poverty nor for
generating rapid economic growth. Rather, it is designed to tie perpetually the
economies of client economies to the apron-spring of the metropolitan ‘Western
economies. The main planks of the “Washington Consensus” were propounded by
John Williamson, a World Bank Consultant, and is a synonym for neo-liberalism
and market fundamentalism. In its broad terms, the principles enunciated in the
‘Consensus’ were, designed principally for the Latin American countries. The
Washington Consensus contains ten broad propositions:
(i) Fiscal discipline
via a Fiscal Responsibility Bill that restricts, rather than promotes, public
investment in the economy.
(ii) Redirection
of public expenditures towards areas that offer both high economic returns and
the potential to ensure income distribution, and the provision of basic
physical, social and economic infrastructures away from public responsibility
to the private domain.
(iii) Tax
reform, so as to lower marginal rates and reduce the tax burden in favour of
the rich.
(iv) Interest
rate liberalisation, so as to enable banks and other financial Institutions to
charge the ‘market’ determined rates of interest that are not normally
beneficial to the lower income investors, and small and medium scale
entrepreneurs.
(v) Free and
market determined exchange rates, causing recurrent currency devaluations,
particularly in the dependent economies, thus depressing the value of the
incomes of wage earners and of the dependent groups in the economy. It renders
the value of the national currency virtually worthless and inconvertible
internationally.
(vi) Trade
liberalisation and the abandonment of trade regulation by the government of
developing economies in favour of the metropolitan economies of the West, in a
manner that increases the adverse balance of trade of the poorer economies in
their trade relations with the developed western economies.
(vii) Dependence
on inflows of foreign direct investment as the main engine of growth of the
developing economies, a dependence that has had the negative effect of causing
capital flight away from the poor economies into the developed economies.
(viii) Privatisation
of publicly owned enterprises and the reduction or minimisation of the role of
government in the economy
(ix) Deregulation
of the economy, particularly the abandonment of economic planning based on time
sequences of 4-year-5-year-ten year or other types of perspective planning.
(x) Security
of property rights in favour of the rich or of the endowed few, so as to
prevent the imitation of the Japanese type of development, through the
domestication of foreign technology and expertise.
The
10 propositions were regarded as reforms which should be imposed on pliant
countries that agree to be tied to the apron-strings of the developed
economies. The original proponents of the Consensus have now admitted that the
imposition of a majority of the propositions is harmful to developing
economies, particularly currency devaluation, privatisation, trade
liberalisation, deregulation, market determined economic policies and dependence
on the free flow of direct foreign investment. All the Latin American
countries, for which the consensus was originally designed, have rejected the
main pillars of the consensus. Some of the Latin American countries, like
Venezuela, Bolivia and Peru, are now nationalizing private foreign enterprises
and are emphasising the dominant role of government in their respective
economies. The original proponents of the 10 principles have admitted, in
various fora and in publications at conferences, that the proposals are not
immutable and should not be apishly adopted. The East Asian countries have also
rejected the consensus, since the 1996 Asian Economic Crisis, and have denied
the role of direct foreign investment as the main pillar of their continued development
programmes. It has been further admitted that:
(a) Privatisation
has become controversial in many parts of the world and has been rejected
because of its right-wing anti-people economic consequences.
(b) Deregulation
is equally not a policy that reverberates in the more rapidly developing
economies of South East Asia (South Korea, Thailand, Singapore, Malaysia,
Indonesia, Hong Kong and Taiwan-the Asian Tigers), where the economic policies
pursued run much in the opposite direction.
(c) The
Consensus is a conservative, right-wing capitalistic, rather than a progressive
economic policy. It is more suited to developed than to the developing
economies
(d) The
Consensus is a geographically and historically specific reform agendum for
Latin America in 1990 and not meant to be adopted, hook line and sinker, by
other geographic areas of the world, where the economic situations are
different. The proponents of the Consensus have confessed that they had not
considered the African or the Asian economic scenes when they propounded the
consensus; and that some have wrongly interpreted the Washington Consensus as
an economic manifesto valid for all places and at all times. They admit that it
has become foolish to advocate, as the Federal Government has been doing, rabid
liberalisation and privatisation, which is a new form of economic imperialism.
The proponents also admit that liberalisation does not necessarily imply a
swing to market fundamentalism and a minimalist role of government. Thus,
countries that adopt the Washington Consensus are more World Bank/IMF minded
than the two institutions themselves and are thus slaves to policies that had
not been tested to have succeeded anywhere in the developing world. The
concept, design and implementation of Nigeria’s privatisation programme have
been under the aegis of the World Bank/IMF. The Bureau of Public Enterprises
(BPE) itself confessed that it continued to enjoy the best support from the
World Bank and its affiliates as partners in progress and that an arm of the
World Bank, the International Finance Corporation (IFC), has been serving as
the sole adviser of the Federal Government with respect to the effective
implementation of its privatisation programme since its inception in 1999,
inspite of the fact that such privatisation orgy has not succeeded in any part
of the developing world.
WASHINGTON
CONSENSUS AND POVERTY REDUCTION
It
is now generally admitted that market fundamentalism, neo-liberalism,
privatisation and the minimisation of the role of the government in the economy
do not offer effective agenda for reducing poverty, because they do not
sufficiently build or rebuild the human capital. On the other hand, the
Washington Consensus policies are inimical to the cause of poverty reduction in
developing countries. Rather, they exacerbate the poverty of the poor. Also,
pursued, as Nigeria has been doing, the Consensus could precipitate an economic
tragedy of the type that occurred during the South East Asian crisis, which
gave rise to the sudden total collapse of the South East Asian countries
economies. The type of privatisation being pursued by the present Federal
Government allows the plundering of the national assets for the benefit of an
elite few. It is also agreed that no universal economic model, like the
Washington Consensus, should be imposed on a country desirous of rapid economic
growth. It offers very little and warrants little or no support as a sufficient
economic policy directive for serious people-oriented policies. It does not
promote equitable income distribution, rapid economic growth or a decent
economic and social environment. Instead of sticking slavishly to the
principles enunciated in the Washington Consensus, a new economic policy should
be advocated that more adequately reflects the goals of development and
enhances the chances of local rather than foreign ownership of the means of
production for more rapid and equitable economic growth. In many parts of the
world today, there is visceral hatred for free markets of the type being advocated
by the present regime. It is only practised by the lackeys of the IMF/World
Bank and their Western sponsors. Much of the revenue derived from privatising
public enterprises, for instance, is not directed to the build-up of human
capital or to stimulate productivity in the economy. Rather, it goes pari passu
with retrenchment of workers, that depresses the economy, instead of the
employment of more workers that stimulates the economy. It gives rise to unduly
increased foreign currency reserves which are kept away in developed economies
while the citizens wallow in abject poverty and squalor at home.
Devaluation
of the Currency: By embarking upon recurrent currency devaluation, as has
been the case in Nigeria since September1986, the poor has become poorer and
the rich few have become richer and the economy has consequently become poorer.
Thus, $1USA which was the equivalent of 50kobo in 1979, and 60 kobo in 1986,
became the equivalent of N68 in 1999 and N130 today, without the income or the
wage earnings of Nigerians being correspondingly increased in compensation.
Thus, N1 today is worth 1/260 of its worth in 1979, when
President Obasanjo left office as the Nigerian Military Head of State. N1 today
is worth only about 50% of its worth in 1999, when Obasanjo resumed office as
Nigeria’s Head of State. This is why per capita income per annum of Nigerians,
which was equal to $450 in 1980, has fallen to $275 today. It is because of the
slavish adoption of the Washington Consensus, of following free/floating Naira
exchange rates. It is now broadly agreed that neither free market exchange
rates, slavishly pursued by our Central Bank, nor rigidly fixed exchange rates
is ideal. Rather, an intermediate policy between the two, with limited
flexibility, in a government managed form, is ideal for a developing economy
like Nigeria. Discretion, rather than rigidity to untested economic policies,
is the hallmark of intelligent economic managers. Such tested economic managers
are very few in the present federal government set-up.
DOMESTIC VERSUS EXTERNAL DEBT
In
1999, when the present regime came into office, Nigeria was owing N537.5billion
domestic debt and N633.1billion external public debt. The domestic and the
external debt miasma commenced from the jumbo external loans and the flippant
domestic loan that the Obasanjo regime took in 1978, when such loans were not
needed by Nigeria. The succeeding regimes wallowed in spurious domestic and
external borrowings so that by the end of 2005, the outstanding domestic debt
of Nigeria had increased to N1,525.9billion, about three times that of 1999,
and the outstanding external public debt had risen to N4,890.3billion
($35.95billion) also about thrice that of 1999 in naira terms, mainly because
of the fall in the value of the naira over the period. These domestic and
external debts were owed, inspite of the fact that crude oil prices of Nigeria
rose from $16.5 per barrel in 1999 to $70.2 per barrel in 2005. The trajectory
increase in the domestic and in the external debts were due to the profligacy
of the federal government, despite its down-sizing of the public sector, its
due process and its avowed fiscal responsibility. Rather than repay domestic
debt, pay pensions, gratuities and other domestic creditors, in order to
reflate and enhance a more rapid growth of the economy, the regime embarked
upon the repayment of external debt, in order to please its foreign sponsors
and its greedy foreign partners and get their support for the unconstitutional
determination of the regime to perpetuate itself in office till 2020. The
regime bought the bait of the Western creditor nations to pay $12.5billion of
the debt at a tranch, in order to receive $18billion debt relief, an amount
which no other debtor-nation in history has ever paid at once. While some of
the other debtor countries in Africa, Asia and Latin America, 42 of them, are
obtaining complete debt write-off, Nigeria paid such a huge ransom, because the
Nigerian Government has more money than sense. Of course, the Western creditors
had begun to observe that, because of its domestic economic and political
policies, the present regime might run Nigeria into disintegration and might
make it impossible for the creditors to be repaid should Nigeria go into
pieces, like the former Russian Empire. So, today, the regime is still being
pressured to pay much of the remaining $5billion external debt, even when the
huge domestic public debt of N1,526 billion is left unattended to. In addition
to the outstanding domestic public debt, the regime is owing N875billion in
pension and salary arrears, apart from N160billion it is owing to the Lagos
State Government in withheld statutory allocation, contrary to the decision of
the Nigerian Supreme Court. In effect, the economic charity of the federal
government begins and ends abroad and ignores the home. It is this huge unpaid
domestic debt, plus unpaid pensions and gratuities and the withdrawal of
government from actively promoting the economy, that has led to the increased
miseration of Nigerians. Majority of Nigerians are poorer, economically, today
than they were at the inception of the present regime in May, 1999.
FISCAL
RESPONSIBILITY AND NIGERIAN EXTRACTIVE INDUSTRY TRANSPARENCY INITIATIVE (NEITI)
As
part of its major reform planks, the present regime prides itself with fiscal
responsibility. It has, in its pursuance, sent to the National Assembly a
Fiscal Responsibility Bill, designed to:
(i) improve
intergovernmental fiscal coordination
(ii) promote
fiscal macro-economic stability
(iii) promote
fiscal prudence and sound financial management
(iv) ensure
transparency and strengthen accountability, and
(v) provide
a conducive climate for generating growth and reducing poverty
Again, the Fiscal
Responsibility Bill is a carbon copy of the USA Fiscal Responsibility Act of
1982, transplanted into Nigeria. Our Presidency has a fleet of about 5 aircraft
and 4 helicopters for use by the leading members of the regime to gallivant
around Nigeria and around the world, while the National Airline, the Nigerian
Airways, had been killed and sold by the regime and replaced by a privately
owned British Airline, the Virgin Airline! The Presidency alone has 89 Special
Advisers, Assistants and Aides, the highest number of aides by any Presidency
in the World today, including the USA Presidency. The copy of America’s Fiscal
Responsibility Act is another demonstration that none of the so-called reform
agenda of the present federal government is homegrown. Yet, the regime is
insisting that the reforms must continue after the present regime. It must not
continue to be so. The reform agenda must be jettisoned because they hold down
the economy of Nigeria. They criminalise and pauperise Nigerians. If our
governments will comply with the copious fiscal and financial provisions in the
1999 Constitution, that is, Articles 80-89; 120-129; 162-168; and 225-229, Nigeria
does not need a Fiscal Responsibility Act. Also, the existence of the Revenue
Mobilisation and Fiscal Commission, provided for in the Third Schedule, Part 1,
Section 31, and Article 153 of the 1999 Constitution, further renders the
Fiscal Responsibility Act redundant.
With
respect to NEITI (Nigerian Extractive Industries Transparency Initiative), the
present regime is the only one in the history of Nigeria, where the President
also holds the Federal Ministry of Petroleum Resources. Thus, few people in
Nigeria, since 1999, have been able to ask and obtain the necessary and true
information about the revenues and expenditures of the Petroleum Industry, not
even the National Assembly nor the Federal Executive Council. The President has
kept hold of the Petroleum Ministry, the mainstay (90%) of the total Government
revenue, exclusively to himself. The Presidency has thus been allocating the
lifting of crude petroleum oil and oil blocs as it deemed fit to associates and
to foreign development partners, after supposed open bids for such allocations.
The regime is lackadaisical in the repairs of the four existing Nigerian
refineries. Rather, it prefers to import fuels for domestic use through and
from the countries of our development partners. There has been no audited
accounts of the Petroleum Ministry since 1999! Thus, NEITI is a suspect at home
and abroad. No wonder that there was the recent outburst of scandals in the
management of the Petroleum Technology Development Fund (PTDF), which is only a
microcosym in the petroleum industry. No wonder that Nigeria, the 8th
largest producer of crude oil in the world, is suffering from acute shortage of
domestic fuels, and has depended increasingly on the importation of fuel oils,
and has been toying with the privatisation of the four refineries. Other oil
producing countries in OPEC (Organisation of Petroleum Exporting Countries) are
nationalizing their oil industry, building additional domestic refineries,
acquiring refineries in other foreign countries and are exporting refined
petroleum products. Only Nigeria among the 11 OPEC countries, Algeria,
Indonesia, Iran, Iraq, Kuwait, Lybia, Nigeria, Qatar, Saudi Arabia, United Arab
Emirates and Venezuela, is pursuing a domestic energy policy of sell-out of its
petroleum resources to foreign and to domestic capitalists. Nigeria built a
multi-million dollar Bonny Export Terminal in the 1990s for the exportation of
excess refined petroleum products. Today, the Terminal has been transformed
into an Import Terminal!
DOWN-SIZING/RIGHT-SIZING OF THE PUBLIC SECTOR
Since
May 29, 1999, the present regime has retrenched about 4.8million Nigerians in
the civil service, in the statutory corporations, in the state-owned companies,
in the banks, and in the insurance companies, through its reform policy of
down-sizing the public sector of the economy and minimising the economic role
of government. It has continued to place emphasis on the private sector as the
engine of growth of the Nigerian economy, whereas the private sector is very
weak in Nigeria and depends for its survival and continued growth on the public
sector. Because of the jaundiced reform policy in this sphere, many public
enterprises have either collapsed, closed down or been sold to foreigners,
while the public service which was once vibrant, productive and incorruptible
has become a haven of corruption, inefficiency and stupor. The erstwhile
security of tenure of the civil servants, other things being equal, has become
a mirage. Retirements and retrenchments, without due process, have become the
order of the day since May, 1999. The down-sizing of the public sector has
consequentially led to the down-sizing of the private sector, because the
economic managers in government do not appreciate that a decelerating public sector
also leads to a decelerating private sector, and vice-versa. It is an immutable
economic causation.
The
reform policy of down-sizing the public sector is itself borrowed from the
IMF/World Bank. In its January 1999 symposium, published in the World Bank
Economic Review, Volume 13, number 1 of January, 1999 (214 pages), the World
Bank had as its main theme, “Public Sector Down-sizing”, “A symposium Issue on
Efficient Public Sector Downsizing”. It contained the following sub-themes and
topics:
(i) Public
sector down-sizing: An introduction
(ii) Cross-country
evidence on public sector retrenchment
(iii) The
efficient mechanism for downsizing the public sector
(iv) Earnings
and welfare after downsizing
(v) Matching
severance payments with worker losses in the Egyptian Public sector, and,
(vi) The
Algerian retrenchment system
Also,
the World Bank Research Observer, Volume 17, Number 2, 2002, discussed, “Public
Sector Downsizing, the Gender Implications of Public Sector, Downsizing: the
Reform Program of Vietnam”. It will again be seen that the so-called public
service reforms are not this regime’s original thinking but are imposed reform
agenda by the World Bank, the IMF and by our Development Partners. That is why,
we see the Development Partners but Nigerians do not see any worthwhile
development in the Nigerian economy. The downsizing of the public sector has
been abandoned even in developed countries of USA, Canada, Europe and in the
developing countries of Asia and Latin America, because of its negative
multiplier effects, that is, its economic deceleration effects. Retrenchment
leads to reduced consumer demand which reduces the propensity to produce and
which leads to reduction in the rate of growth of the gross domestic product.
It is a suicidal economic policy. All true and sensible reformers in history
have increased rather than reduced, employment quantum in very significant
manner.
BANKING REFORM AND NIGERIA’S ECONOMY: The Large Banks
When
the present regime came on board in 1999, there were 90 banks in Nigeria, 73 of
which were categorised as sound/satisfactory, while 17 were rated as
marginal/unsound. But as a result of the unsound economic and financial
policies of the regime, the number of sound banks reduced to 67 in 2002, 64 in
2003, 61 in 2004 and 53 in 2005, while the marginal/unsound banks increased
from 17 in 2000, to 37 in 2005. The weaknesses of some of the banks arose from
the arbitrary behaviour of the Central Bank of Nigeria (CBN) towards the banks.
Instead of the CBN to be the bank for the banks and assist them, in the same
manner that the banks are expected to assist their customers, the CBN had
constituted itself as a bugbear to the banks. Because of the phobia of the CBN
against inflation, it recurrently and arbitrarily withdrew money from the
banks, thus reducing their capacity to create credit and develop themselves and
the Nigerian economy. Rather than continue to assist the sound banks to become
sounder and the less sound banks to become sound, the CBN arbitrarily increased
the required capital base of the existing banks from N5billion in 2004 to
N25billion in 2006. The consequence was that the number of banks in Nigeria
reduced from 90 in 2004 to 25 in 2006! The CBN and the Federal Government
wrongly assumed, and are still wrongly assuming, that the mere large size of
the banks will ensure their soundness. This is no less fallacious than that the
mere large size of Nigeria’s population guarantees the soundness of our economy
and the dexterity of our governance. Very large banks in the world have
collapsed, while small banks have remained sound and alive. Just as there are
small, medium and large industries, so there should be small, medium and large
banks. Forced mergers of the Nigerian banks had been creating ripples in the
Boardrooms of some of them. We may be finding out later that the forced bank
consolidation, which the CBN itself confessed was engineered by the IMF/World
Bank advisers since 2000, may become a short-gun marriage in the future. As a
result of the forced merger and the N25billion minimum capitalisation, bank
ownership in Nigeria has become more foreign controlled than ever before. It is
currently the case in South Africa, where the four largest banks there are
owned and controlled from Europe. It is the sizes of these 4 large South
African Banks that our CBN Governor and our President always cite as the reason
for the bank consolidation in Nigeria. It is these large consolidated banks, in
partnership with their foreign sponsors, that are expected to manage the
$45billion dollar reserves of Nigeria. In effect, we are moving gradually to
the pre-independence era, when our banks were largely owned and controlled from
abroad. Before consolidation, out of the 100 largest banks in Africa in 2002,
Nigeria owned 25 and South Africa owned only 4. Yet, there had not been any
bank consolidation in South Africa, which would have had the effect of
destroying many of its small banks. The bank consolidation is in the same mode
of the privatisation policy which has been concentrating the wealth of Nigeria
in fewer and fewer hands. There is still a plan in the offing to raise the
minimum bank capitalisation to N100billion so that there will be only about
5-10 large banks in Nigeria. The banking consolidation, according to the
Institute of Bankers, caused the loss of jobs immediately before and after the
consolidation. Many senior members of staff of the banks are being regularly
retired or forced to retire since the consolidation. To date, over 200,00
banking officials have been rendered jobless since the announcement of the
consolidation, in July 2004.
Even
in the USA; the most capitalistic country in the world, there are very many
small banks that cater for special needs of limited areas of the country or for
small enterprises. The larger the banks, the less they cater for the needs of
small and medium scale enterprises without which no modern economy can develop
rapidly. Only about 35% of Nigerians are today served by the large banks. It
has become increasingly difficult for small businesses to access investment
funds from the large banks, inspite of the avowed policy of the Central Bank to
compel the banks to provide such funds. The Central Bank keeps on announcing
that there is excess liquidity in the economy while the masses or Nigerians
wallow in increasing poverty and deprivation.
THE SMALL BANKS: Community Banks/People’s Bank
At
the inception of the present regime in 1999, there were 960 Community Banks.
Today, they had reduced to about 650. Rather than continue to assist and
promote the Community Banks, the regime has decided to abolish them and replace
them with micro-finance institutions, with minimum capitalisation of N20million
for a Micro-Finance Bank, instead of the former N10million, and N1billion for a
state-sponsored micro-finance bank, instead of the former N10million for a
community bank. The number of such micro-finance banks is expected to reduce to
fewer than 400, thus, further denying the Nigerian rural communities of the
benefit of rural banking services. This is the more so, when the People’s Bank,
with its 750 branches, had been abolished since 2002, and merged with the large
Nigerian Agricultural and Rural Development Bank (NARDB), which now largely
caters for the large enterprises and large farmers. Also in 1999, there were
150 Finance companies and 120 Primary Mortgage Institutions (PMIs). Today,
there are only 82 operating finance companies and 60 operating Primary Mortgage
Institutions. The capital bases of the finance companies and of the primary
mortgage institutions are being arbitrarily increased so that their number will
be further drastically reduced. Their services will thus be inaccessible to the
less privileged Nigerians. The Finance companies are also being merged with the
micro-finance banks, with the consequent economic disadvantages that their
abolition will bring, apart from the retrenchment of workers that consequently
arises. It was estimated that over 150,000 full time employees of the People’s
bank of Nigeria were retrenched, following its abolition. With respect to the
Community Banks that employed about 500,000 Nigerians, fewer than 200,000 will
remain in the employment of the Micro-finance Companies that may replace them.
300,000 Nigerian employees of the Community Banks will thus join the already
crowded unemployment market thereby.
INSURANCE CONSOLIDATION AND THE ECONOMY
At
the inception of the present regime in 1999, there were 255 insurance companies
in operation. The minimum capital base for an insurance company by 1999 was
N25million. The present regime increased the capital base in 2003 as follows:
(i) Life
Insurance – N150million
(ii) General
Insurance – N200million
(iii) Composite
Insurance (Life & General) – N350million
(iv) Re-Insurance
– N350million
The result was
that the number of insurance companies reduced from 255 to 102.
With effect from
March 1, 2007, the minimum capital base of the respective insurance companies
was further increased as follows:
(i) Life
Insurance – N2billion
(ii) General
Insurance – N3billion
(iii) Composite
Insurance (Life & General) – N10billion
(iv) Re-Insurance
– N10billion
By the beginning
of March 2007, only about 35 insurance companies have met the capitalisation
criterion. While there is nothing wrong in making banks and insurance companies
have large capital basses, the small and medium sized ones that cater for
limited sectors of the economy need not be squeezed out of existence. The
reforms in the financial sector are thus forced, one-sided and in favour of the
rich, in whose hands the financial sector will now be fully concentrated,
contrary to the provisions of Article 16(2c) of the1999 Constitution, which
prohibits the concentration of Nigeria’s wealth or the means of exchange in the
hands of a few individuals or of a group of Nigerians or non-Nigerians.
Furthermore, the loss of jobs that will arise from the Insurance Consolidation
will not be less than 200,000, thus swelling the already congested unemployment
market.
CONCLUDING COMMENTS
The
purpose of this assessment is to show that some of the reforms being touted by
the present regime are not only unconstitutional but are also inimical to the
continued growth of Nigeria’s economy and to the welfare of the majority of our
citizens. They are also foreign-inspired and not home-grown, contrary to what
Nigerians are being made to believe. Nigeria is thus increasingly being
dominated by external influences to the disadvantage of Nigeria. We have a
foreign-oriented and foreign controlled government, masquerading as a
nationalist and reformist government. Even the NEEDS (National Economic
Empowerment and Development Strategy), which is the economic blue print that
encapsulates all the so-called government reforms, was prepared on the
directives and with the assistance of the World Bank/IMF. Little is heard of
NEEDS of recent. It is likely going to die with the exit of this
administration. ‘NEEDS’ has been midwived by six separate Economic Advisers to
the President since 1999. It has lacked focus, lacked investment quantum and is
not time specific.
It
is the anti-welfare stance of the present regime that made fuel prices rise
from N18 per litre of petrol (PMS) in 1999 to N65 per litre today, Diesel price
rose from N17 per litre in 1999 to N95 per litre today, when available, and
kerosene rose from N16 per litre in 1999 to more than N100 per litre today. It
is kerosene that the rural population of Nigeria needs and uses most. It has
become a scarce product. Until 1999, even at the low prices of petroleum fuels,
the then Federal Government spent part of it to set up the Petroleum Trust Fund
(PTF) to provide basic infrastructures which are the main ones still available
to Nigerians today. When President Obasanjo assumed office in 1999, the first
thing that he did was to cancel the PTF and to substitute nothing in its place,
ever since, even at almost four times the price of fuels today compared with
pre-1999. The basic infrastructures provided by the PTF have not only not been
improved upon significantly, since 1999, but many of them have also been
permitted to deteriorate for lack of maintenance or sustenance.
It
is necessary that Nigerians be told the source, the manner and the consequences
of the on-going reforms, so that they are not deceived into believing that
their continuation after the exit of the present regime will be in the interest
of the economy and of the increased welfare of the masses of our people. Even
the GSM introduction was not achieved by the present regime, but by the
previous regime. The GSM is a good communications network, but this regime had
virtually destroyed the land-telephone system, in order to privatise it. In
other countries, the land telephone system is the main communications system,
with the mobile phone system serving as a subsidiary and emergency outfit to
complement the land telephone system. The mobile phone system has taken much
revenue away from the pockets of Nigerians and from the economy to its
providers abroad. The flight of capital that it has occasioned need to be
imagined. The so-called employment that it has generated is known in economics
as gross under-employment. In 1999, to post a letter through the Nigerian
Postal System cost N10. Today, it costs N50. Other postal costs have
correspondingly increase by at least 500%.
In
1979, when General Obasanjo was handing over the reins of government, to
civilians, he announced to bewildered Nigerians that the best candidate then,
Chief Obafemi Awolowo, would not and needed not win the then Federal Elections.
General Obasanjo contrived and handed over power to his anointed candidate,
whose political ambition then was to be a Senator in Nigeria’s National
Assembly. A manipulated federal election gave rise to great legal controversies
as to whether or not 12⅔ States or 13 States constituted two thirds of the then
19 States of Nigeria. His mishandling of the hand-over of power, though he got
world-wide acclaim thereby, subsequently gave rise to less than optimum
governance in Nigeria. It eventually led to the military coup d’etat of
December 31, 1983, and to the sixteen long years of military rule, until
General Obasanjo himself resumed the Presidency again in May, 1999. He has
since been moaning that Nigeria made no significant economic progress since he
left office in 1979. Now, in 2007, President Obasanjo’s regime is in the
process of repeating its handing over power mistake of 1979. It prevented the
best candidates in the regime from seeking-nomination for the Presidency of
Nigeria at the PDP Convention. Instead, it hand-picked a very good and amiable
Nigerian, whose highest political ambition was to be the Governor of Katsina
State for eight years and retire quietly in 2007 into his farm. The regime also
harassed the anointed Presidential flag bearer from choosing an able running
mate and foisted on him another crony of the regime. So, the country may be
having two candidates of the “Third Eleven Calibre” as the President and the
Vice President of Nigeria, should the PDP, through do or die election, win the
April 2007 Presidential election. So, if President Obasanjo lives long enough,
for the next 20 years, and I pray for his long life, the same period between
1979 and 1999, he may again in 2027, moan that Nigeria had moved some steps
backwards from when he handed over power on May 29, 2007, he prevented the most
capable Nigerians from ruling Nigeria after him.
There
is no doubt that the 1999-2007 regime has tried its utmost best to steer the
Nigerian economy and its governance along what it regards as a nationalistic
and dynamic path. It has loudly publicised its achievements, at home and
abroad, at exorbitant cost to the nation’s treasury. However, it has pursued a
backward sloping economic curve that has pauperised, criminalised and corrupted
Nigerians today more than they were at its inception in May, 1999. Because of
its wrong economic direction, the more efforts it makes the less economic
progress the regime will continue to achieve and the less, it will continue to
meet the economic aspirations of Nigerians. The fastest growing economy in the
world today, is the Chinese economy, which is a state controlled and a public
sector, rather than a private sector driven economy. The Nigerian economy was
actively and successfully public sector driven from the 1950s up to the early
1980s, until the military integument beheaded the public service and killed its
effectiveness, and our economy began to nose-dive into the doldrums. Rather
than find out what went wrong and take remedial measures, this regime, like its
predecessor of Babangida’s, continues to depend on a non-existent private
sector for its economic salvation. It is a forlorn economic hope.
It
is, therefore, necessary for each of the contending political parties, wanting
to replace the present regime, in the 2007 elections, to have its own
alternative blue print that will be more in tune with the economic needs and
the aspirations of the majority of Nigerians. Otherwise, by 2020, the Nigerian
economy will not be near any of the 20 largest economies in the world, to which
this regime has been basing its aspiration. Today, Nigeria is the 55th
largest economy in the world. In 2020, it may decline to the 65th,
75th or 85th largest economy, if the present reform
policies continue to be the main planks of Nigeria’s economic development
strategy.
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