Making the Bouquet of Palliatives Work

NLC members marching against increase in fuel price

In the wake of the public outcry against the hike in the price of petroleum motor spirit (PMS), otherwise known as petrol, the federal government has unveiled what it packaged in the 2016 Budget as ‘palliatives’ to cushion the adverse effects on the masses. Ndubuisi Francis, in this report, reviews the incentives

For most homes in Nigeria, these are not the best of times. Many are walking through the valley of the shadows of death with economic adversity holding sway. It appears a common denominator in most households, and provides Nigerians with little or no choices. Gloom seems to have enveloped the atmosphere with the purchasing power of most Nigerians fizzling out.

In deed, the immediate-past Finance Minister, Dr. Ngozi Okonjo-Iweala, had repeatedly raised the alarm in the wake of the precipitous fall in oil prices that tough times awaited Nigerians in 2015 and beyond. And those tough times are here.

Nigerians may not be alone in the current economic hardship. Many commodity exporting countries are faced with similar tough times due to the global fall in the prices of such items, but what determines the level of economic adversity faced by the citizens of the various countries affected by price shocks could be official policies and management approach.

In the case of Nigeria, the citizenry has fought the rampaging economic adversity from various fronts. From the later part of last year till now, the scarcity of PMS with the attendant prohibitive cost not only bore gaping holes in the pockets of most Nigerians, but also inflicted maximum psychological and other socio-economic blows on them. In the face of all these, the income of those gainfully employed remained static.

The government dished out promises upon promises of ending the trauma that the PMS conundrum inflicted, but all ended in the ocean of Utopia.

However, the government finally decided to stop living in denial on May 12, 2015 when it ‘removed’ fuel subsidies. The removal later attracted various nomenclature, including ‘price modulation’ as the price per litre of PMS currently stands officially at N145 per litre as against N86.50/N86 it was fixed early in the year.

That hike in the pump price of fuel (or is it subsidy removal?) has drawn the ire of many Nigerians with organised labour led by the Nigeria Labour Congress (NLC) as the arrowhead.

Not a few Nigerians had questioned the rationale behind the federal government’s action and timing, at a period many Nigerians are merely existing and not living. The moderates, who are not totally opposed to the federal government’s action had particularly argued that ‘palliatives’ should have accompanied the hike. Their position is predicated on the consideration that inflation has ballooned to an all-time high of almost 14 per cent, forcing prices of virtually everything, including staples and transportation to skyrocket to unprecedented levels in recent years.

Many had argued that when the previous administration under former President Goodluck Jonathan made an attempt to remove subsidy on PMS in January 2012, and met stiff resistance from the masses, it was forced to embark on partial removal by pegging the pump price of the product at N97.

The now-rested Subsidy Reinvestment and Empowerment Programme (SURE-P) came handy as a throw-up of the partial subsidy removal which offered a window through which governments at the federal and state levels provided palliatives to pacify angry Nigerians as well as salve frayed nerves.

Funds from SURE-P provided a revolving mass transit scheme with mass transport buses acquired to subsidise transportation expenses incurred by commuters

The rail system also benefited; while maternity and child health intervention programme received serious attention, just as vocational training programme received attention.

In the 2014 fiscal year alone, the previous government earmarked the sum of N30 billion under SURE-P for the East-West Road; N12.5 billion for Abuja-Lokoja road project; N10 billion for the Benin-Ore-Shagamu road and N12.5 billion for the dualisation of the Kano-Maiduguri road project.

Others are N11 billion for the Port-Harcourt-Enugu-Onitsha road project; N10 billion as counterpart funding for the construction of second Niger Bridge and N20 billion for Lagos-Ibadan Expressway project.

Giving the 2016 Budget breakdown,, the Minister of Budget and National Planning, Senator Udoma Udo Udoma and the Minister of State, Mrs. Zainab Ahmed, had unveiled N500 billion Social Intervention Projects in five areas.

The areas include Job Creation, School Feeding, Conditional Cash Transfer, Enterprise Programme, and STEM Education Grant.

Under job creation, the government has earmarked N191.5 billion to provide jobs for 500,000 teachers and 100,000 artisans while N93.1 billion is voted for feeding 5.5 million school children for 200 days.

For Conditional Cash Transfer, from the N8.7 billion budgeted, the sum of N5,000 per month is to be paid to a million beneficiaries while the Enterprise Programme has a budget of N140.3 billion to support one million market women; 400,000 artisans and 200,000 agric workers.

The N5.8 billion STEM Education Grant, one of the five areas covered by the Social Intervention Projects is targeting 100,000 Science, Technology, Engineering and Mathematics (STEM).

But with reactions trailing the current hike in the price of PMS and the attendant public outcry, the government has declared that the social intervention projects are offering the palliatives to cushion the effect of the hike.

The Senior Special Assistant to the Vice President on Media and Publicity, Mr. Laolu Akande, had last week given a breakdown of the interventions and palliatives, some of which he said would be starting in a matter of weeks.

According to him, the federal government would be directly impacting the lives of over eight million Nigerians through the various social investments in the 2016 budget spending that would offer relief and serve as palliatives to ordinary Nigerians.

Echoing the package, which Udoma and Ahmed at the budget breakdown, the Vice President’s spoesman said the direct payment of N5,000 monthly to one million extremely poor Nigerians for 12 months is provided for in the 2016 budget for which N$68.7 billion has been appropriated.

Akande also alluded to the direct provision of very soft loans for traders and artisans, including agricultural workers.

According to him, this would reach a total of 1.76 million Nigerians, without the requirement of conventional collateral, with some of the traders likely to get about N60, 000.

“Payment of between N23,000 to N30,000 per month to 500,000 unemployed graduates who would be trained, paid and deployed to work as volunteer teachers, public health officers and extension service workers among other responsibilities.

“They would also be given electronic devices to empower them technologically both for their assignments and beyond. Similarly, 100,000 artisans would also be trained and paid. N191.5 billion has been set aside for this in the budget,” he said.

The media aide to the Vice President noted that “at least 5.5 million Nigerian primary school children – i.e starting first in 18 states, three per geo-political zones – would be fed for 200 school days under the free home-grown School Feeding Programme,” adding that N93.1 billion has been appropriated for this in the 2016 budget.

His words: “100,000 tertiary students in Science Technology Engineering and Maths (STEM) plus Education will partake in the N5.8bn already provided for this education grant in the budget. This payment would also be paid directly to the students.”

Summing the Social Intervention Projects up, Akande said when aggregated, this year alone, over eight million Nigerians would be benefiting, stressing that the N500 billion programme of the Buhari administration is a ready-made palliative to lift Nigerians from poverty and economic hardship.

“Long before now, the Presidency had made adequate arrangements in the 2016 budget to ensure that Nigerians are lifted from poverty and hardship,” he said, pointing out that this would not only alleviate the current pain arising from the new fuel pricing regime, but will provide ongoing social safety nets for over eight million citizens this year alone.

“The Buhari presidency is keen to ensure that Nigerians are lifted and that, if necessary, on an ongoing basis palliative measures would always be considered to address the conditions of the people,” Akande said.

While the federal may have conceived the N500 billion social intervention programmes to provide succor to the beleaguered citizens, there are more questions than answers on how the various components will be executed.

For instance, analysts have wondered what would form the template and considerations for those to benefit from the monthly N5,000 stipend. The question on several lips is who are “the extremely poor?”. Who determines the ‘extremely poor? Even if the beneficiaries are to be considered on geo-political basis, who decides the beneficiaries. In a clime where there is no credible data base, who constitute the ‘extremely poor’ and would the beneficiaries not be considered on the basis of political patronage? In this case, many are apprehensive that only those sympathetic to the All Progressives Congress (APC) might end up getting the N5,000 monthly stipend.

Another question begging for answer is what impact a monthly N5000 to the one million ‘extremely poor’ would make on the lives of over 100 million other Nigerians that are also poor; perhaps not ‘extremely’?

The same question applies to other four areas of social intervention programmes. For instance, who benefits from the soft loans for traders, artisans, and agricultural workers. How would the beneficiaries be determined, and who determines them.

Will this not be open to abuses, corruption and nepotic tendencies in a clime where our proclivity for ethnic sentiments, primordial, religious and sectional attachment is legendary?

Many are of the opinion that the best way to administer social intervention programmes for effect, in a complex society like ours is to inject them into areas where less physical contacts and influences.

For instance, transportation costs have skyrocketed and commuters are groaning. Many argue that it would have been more impactful to provide highly subsidized mass transit buses for the 36 states and Abuja, and get more coaches for the rail system while ferries are provided for the riverine communities. That way, commuters won’t pay through their noses.

Analysts believe that the social intervention projects, though commendable, are highly limited in scope. At a time like this, critical mass is a factor, and programmes that will provide the greatest succor to the greatest number are desirable.

Perhaps, the federal government is looking at the divergent views and alternative opinions flowing from the current strike action by a section of organized labour,

It has constituted a 15-man technical committee to consider suggestions and contribution from relevant parties on the N500 billion social investment projects in the 2016 budget as palliatives to cushion the adverse effects of the increase in the pump price of PMS.

The committee headed by the Minister of Labour and Employment, Senator Chris Ngige, is part of the agreement reached between the government, the Trade Union Congress (TUC) and the Joe Ajaero-led faction of the Nigeria Labour Congress.

The Labour Ministry said the trade unions will provide seven members of the committee with TUC and the Ayuba Wabba-led NLC providing five members while the Ajaero faction provides two members.

The government’s representatives on the committee are Minister of State for Petroleum Resource; Minister of Budget and National Planning, Minister of Finance, Minister of Solid Minerals, Chairman, National Salaries, Income and Wages Commission, representative of Office of the Head of service of the Federation and the Office of the Secretary to the Government of the Federation.

“Based on the above efforts by all concerned parties, all industrial actions by members of the NLC and TUC shall be stayed in order to provide a conducive industrial relations atmosphere for the effective and efficient implementation of the Federal Government’s policies to realise the targeted goals and objectives,”. a statement issued by the ministry said.

While asking the affected trade unions to submit all their nominees before close of work to enable their inauguration on Monday, the statement said the committee is expected to submit its report within two weeks.

There is nothing wrong borrowing from some aspects of the palliatives of the previous administration that worked under the SURE-P or fine-tuning those that were well-intentioned but badly executed.

As Nigerians await a more impactful bouquet of palliatives that will salve the frayed nerves of majority of poor Nigerians, it is hoped that those who would be saddled with the execution would see the entire country as a single constituency and avoid those dichotomies that will make some parts alienated from the anticipated reliefs.

The palliatives should not be seen as pay back time for party loyalists and those from some sections of the country. That way, social tension can be assuaged.