Agba: National Development Plan Will Accelerate Inclusive, Private Sector-led Growth

The Minister of State, Budget and National Planning, Prince Clem Agba

In this interview speaks about the federal government’s National Development Plan, 2021-2025. Agba, strongly believe that the economic plan would help accelerate and sustain inclusive and private sector-led growth in the country, address critical macro-structural issues in the areas of concentric economic diversification, expand fiscal space to support higher economic and social expenditure. Obinna Chima brings the excerpts:

What is the National Development Plan all about?

The National Development Plan (NDP), 2021-2025 is the successor Medium Term Plan to the Economic Recovery and Growth Plan (ERGP), 2017-2020. The NDP 2021-2025 was designed to unlock the country’s potential in all sectors of the economy for a sustainable, holistic and inclusive national development; accelerate growth; deepen the initiatives for a diversified economic growth and foster sustainable development. The plan was meant to lift 35 million people out of poverty and generate 21 million jobs by 2025. The total planned investment size of the plan is N348.1 trillion and will be allocated to sectors, programmes and projects in the plan.

We have had several economic plans in the past e.g Vision 20:2020; the ERGP which you mention, that have had little or no effect on the masses, why should we expect this to be any different?

To assume that the ERGP did not have effect on the masses is not evidence based. The ERGP was meant to ensure that Nigeria exit recession, stabilise the macro-economy and return the country to a path of positive growth. This was achieved.  Before the preparation of the NDP, government carried out the end-term review of the ERGP. The result showed that the plan significantly delivered on its key objectives.  The NDP, 2021-2025 is different from other previous plans. It adopted an inclusive and participatory approach. The approach was adopted with the hindsight of the lessons learnt from the implementation of previous plans. It has three volumes with Costed Capital Programmes and Projects and also identified binding constraints for effective plan implementation. Obviously, the outcome of the implementation of the Plan will be different.

 How was the plan conceived, did you get input from the states and other stakeholders?

The plan was formulated against the backdrop of several subsisting development challenges in the country and the need to tackle them within the framework of medium- and long-term plans. These challenges included low and fragile economic growth, insecurity, weak institutions, inefficient public service delivery, infrastructure deficit, climate change and weak social indicators. The plan also builds on the lessons learnt and foundation laid by previous plans.  It is unique from other previous plans because the process was not only participatory and inclusive but consultative involving a broad range of critical stakeholders.  This was deliberately done for inclusiveness, participation and citizen engagement for ownership. To ensure that the new plan remains a truly National Development Plan, all the 36 states of the Federation and Federal Capital Territory Administration as well as representatives of the Local Government Councils and organised private sector, youths, labour unions, traditional and religious organisations, amongst others, were all involved in the preparation process.

Which aspects of the economy is this development plan looking to address?

The National Development Plan, 2021-2025, aims to accelerate and sustain inclusive and private sector-led growth. It will address critical macro-structural issues in the areas of concentric economic diversification, expand fiscal space to support higher economic and social expenditures and create a stable macroeconomic environment. During the plan period, government will focus on sectors with great potentials to generate jobs with multiplier effects on other sectors. The Plan will continue to invest in critical infrastructure such as power and alternative energy, rail, roads and housing. There will be renewed vigour in enhancing business and investment environment. All these will ultimately impact on the living conditions of the Nigerian people.

A lot of Nigerians believe the economy isn’t looking good at the moment with inflation on the rise, exchange rate depreciation, over 100 million Nigerians said to be living in state of multi-dimensional poverty, what role will the National Development Plan play in addressing these challenges?

Rise in inflation is a global phenomenon occasioned specifically by the lingering Russia-Ukrainian war that has impacted hugely on food prices which is the major driver of inflation in the country. The pressure on foreign exchange is as a result of the huge subsidy payments and low oil production. Conscious implementation of the nine priority areas of the plan will no doubt ensure that these structural challenges are addressed. 

The plan speaks about a lot of programmes and projects; how exactly will it be financed?

The plan has a total investment size of N348.1 trillion. Of this amount, N298.4 trillion or 86 per cent will come from the private sector, while the general government (Federal and Sub-national) will account for N49.7 trillion or 14 per cent. Essentially, the plan will be private sector led while government provides the much needed enabling environment for businesses to thrive. In addition, financing vehicles such as Growth Funds, Securitisation and Public-Private-Partnerships (PPP), will be explored.  Also, the Infrastructure Corporation of Nigeria (InfraCo) will provide the lever for infrastructure rebirth and address the infrastructure deficit which has hampered the country’s productive capacity, constrained our product space and competitiveness.

How does the federal government intend to monitor this plan for proper evaluation and how will the general public be carried along?

The government have realised that the success of the Plan will to a large extent depend on the establishment of a strong implementation mechanism and framework that promotes performance and accountability. It is against this backdrop that a Development Plan Implementation Unit (PIU) will be established in the Ministry. There will also be a National Steering Committee (NSC) under the Chairmanship of the Vice President. This will promote overall coordination with Ministries, Departments and Agencies (MDAs), organised private sector and CSOs.

Our public debt has been on the rise. How much more does the government need to borrow to facilitate the execution of the initiatives in this plan?

Government will finance the plan directly from budgetary provision as approved by the National Assembly and provide enabling business environment for the private sector. To ensure fiscal sustainability, efforts will be made towards enhancement of domestic resources mobilisation, especially in enhancing non-oil revenue. The target is to increase national government revenue up to 15 per cent of GDP at the end of 2025. As part of the efforts to improve revenue mobilisation, deliberate efforts are ongoing to effectively implement Strategic Revenue Growth Initiatives (SRGIs).  This initiative focuses on optimizing the operational and collection efficiency of GOEs, restricting the cost-to-revenue ratio of GOEs to 50 per cent, leveraging on technology and ICT, enhancement of existing and creation of new revenue streams.  Where extremely necessary government will borrow to finance capital projects that will eventually be able to pay back. In doing this, government will be mindful of the debt sustainability plan.

There is going to be a change in government and governance come February 2023, won’t this end up being another abandoned project?

The structure of the plan will make it difficult for it to be another abandoned project as the plan has already taken this into consideration during the formulation. The plan has 3 volumes: Volume I is the policy document which is structured around seven cluster areas Economic Growth and Development; Infrastructure; Public Administration (Public Sector Reforms); Human Capital Development; Social Development; Regional Development; and Plan Implementation, Communication, Financing, Monitoring and Evaluation;

Volume 2 contains the prioritised costed capital projects and programmes that will form the foundation of the Federal Government’s annual budget; and

Volume 3 deals with the legislative imperatives which contains the identified binding constraints to Plan implementation. In this regard, 18 laws and 10 policies that constrain Plan implementation that need to be reviewed or amended were identified. Government is also working with the National Assembly to pass into law the Development Planning and Project Continuity Bill to ensure that the plan will not turn out to an abandoned project.

What timelines should the masses be working with in accessing and evaluating this plan?

The National Development Plan, 2021-2025 is due for mid-term review in 2023 and the government is already making necessary preparations for the review. This is consistent with international best practice for mid-term and end-term review of Plans. In addition, government has institutionalized the process of tracking and evaluating Plan implementation by setting up the Development Plan Implementation Unit with membership drawn from relevant MDAs, civil society organisations and organised private sector.