Postscript by Waziri Adio
The insistence of our legislators on an inscrutable right to binge on luxury cars and the audacity of the executive to include some items in the fast-tracked 2023 supplementary budget indicate, clearly, that our current ruling class simply doesn’t get it or is detached from or untouched by the anguish and the hunger roiling the land.
An overwhelming majority of Nigerians are going through it at the moment. Most of our people are struggling with constantly rising prices. They are wrestling with how to make ends meet in general and how to feed themselves and their families in particular. Businesses and households are taking major hits.
The least that is expected of leaders at a period like this is for them to align with the trying times, to show empathy, to demonstrate sensitivity, to model the needed sacrifice. But it seems the gravity of the situation is lost on this lot. This level of tone deafness must be acute. It is jarring and concerning. It needs to be cured, and urgently too.
According to the National Bureau of Statistics (NBS), headline inflation was 26.72% and food inflation was 30.64% in September. Both are projected to soar even higher. So, even if those in government do not go to the same markets as the populace or they are not paying from their pockets, they should at least be aware of the dim official statistics and the grim implications for citizens’ welfare.
But these are even aggregate figures and do not fully reveal the enormity of what people are dealing with. The reality is that the prices of some essential items like food and drugs increase almost daily. Prices of some of these basic items have more than doubled or tripled within weeks. Most people on fixed incomes see their purchasing power plummet. And with surging costs and shrinking demands, some businesses are closing shops and laying off staff.
Sustained increase in prices have been around for a while, but they have picked up pace with the introduction of two policies by the President Bola Tinubu administration: removal of petrol subsidy and what in practical terms is the devaluation of the Naira. Both policies are designed to put the economy on a stronger footing. I remain an unwavering supporter of the need to end the wasteful and misdirected petrol subsidy and the need to terminate the arbitrage-enabling multiple exchange rates.
However, I have had cause to disagree with the implementation in terms of not carefully calibrating and phasing the two reforms—which in essence introduced two simultaneous shocks on an overburdened populace—and the apparent lack of a reform strategy and a contingency plan. But I still maintain that both reforms are necessary and that their attendant pains are significantly less than what would have issued from an inevitable economic collapse.
I was never in any doubt that reforms come with pains. However, we should also realise that the capacity to bear pain is not elastic or infinitely elastic, hence the need for sequencing and for frontloading reliefs. Most importantly, those at the helm should know that they undermine reforms when they transfer the burden of the pains entirely to the populace and carry on as if we live in normal or plenteous times.
It is simply not enough for the president and others to be telling us that they feel the pains of the populace. They need to show it in what they do and how they allocate increasingly scarce resources. It is hollow and disingenuous for leaders to call for citizens to make necessary sacrifice while they are having a blast.
Even if for just symbolic reasons, a more aware leadership will be talking about taking cuts in salaries and allowances, about instituting a freeze on travels, workshops, furniture and cars, about eliminating wastes and leakages, about reducing the cost of government to the barest minimum. But no. Not this lot. The sacrifice, it seems, is beneath them. It is not for them. It is for the hapless people.
They are making it difficult for anyone to continue to defend the removal of the subsidy on petrol which resulted not just in close to 300% jump in pump prices of petrol within four months but has also triggered increase in the costs of other things, especially transport and food. If the leaders are not bearing their share of the pains or they are using the extra revenue from subsidy removal to fund a profligate lifestyle, how do you convince Nigerians going through acute pains that removing petrol subsidy makes sense? How?
What will be your compelling argument to an average Nigerian that she is not better off with petrol at N165 per litre or with a dollar exchanging officially for N461? That our country is not as rich as perceived, is indeed broke and cannot afford or sustain such luxuries? But is there anything that has changed in the comportment of our public officials between the previous or the current prices of petrol and dollars?
If your argument is that she needs to absorb the pains for things to get better in the country. With a sneer, she is likely to ask you: but is everyone, especially those at the top, making sacrifices? And what’s the guarantee that those not making sacrifices will not be the same ones that will corner the benefits, if any?
Do our public official look and behave as if they are administering a country that is running a budget deficit of about 50% and using 96% of its revenue to service debt? Do they look like leaders of a country where more than 90 million citizens and counting are income-poor and 133 million citizens and counting are multi-dimensionally poor? Do they? Do you see that in the historic size of the president’s cabinet, the number of aides, the size of their convoys and the general flamboyance? Do you?
I have listened to and read arguments put up by our federal legislators on why they need to buy luxury cars and I am still straining to find any of them convincing. By law, parliamentarians are entitled to 400% of their annual basic salary as car loans. With the monetisation policy, most of the perks like housing, furniture and transportation, have been monetised.
Providing for some of these things like cars could amount to double dipping and it makes a mockery of the monetisation policy. And masking them as tools for committee or constituency work is akin to hiding behind one finger. Agreed, 400% of their annual basic salaries cannot buy even decent, used cars now. But our operating context is a time when the poor are getting poorer, and those previously fairly okay are being dragged into poverty. It is a time that calls for sacrifice from those stewarding public resources. Those asking legislators and other public officials to buy Nigerian-made cars are making the wrong arguments. Let them manage whatever they have until things improve.
The media and some civic groups have done a great job analysing the Supplementary Appropriation Bill 2023. A lot has been said about the allocation for cars for State House and the Office of the First Lady, the renovations/construction of residences and offices for the President and the Vice President and for a Presidential Yacht.
Even when some explanations have been given, there are still unanswered questions about timing and sensitivity. And the issue is not about how much these items cost in proportion to the whole budget. It is that making them a priority now screams of: “we don’t care how you people feel or what you are going through.” That is not a good way for the government to come across.
I will raise a few additional issues around the supplementary budget. The first one is on a positive note. It is always better to handle revenue shortfalls and emergencies through supplementary appropriation than through off-budget avenues like Ways and Means. Off-budget funding obscures the process and the expenditure items from legislative and public scrutiny. Generally, opacity enables dark things.
We should commend the government for opting for supplementary appropriation and should insist that the government continues to do so, and that even overdrafts from the central bank should come under legislative oversight, even if it is when considering subsequent appropriations.
But given that this supplementary budget is for a year that is ending in two months, it is important to ask why some of the items in the N2.177 trillion budget cannot be in the 2024 budget.
The budget can be divided into four broad areas: security services and State House; infrastructure in ministries of works, agriculture, housing and FCT; statutory transfer to INEC for off-cycle elections; and provisions for palliatives.
Apart from the N210 billion for wage awards for four months, the N400 billion for cash transfers and the N18 billion for INEC, it is difficult to see what is so urgent about most of the items. For example, there are roads, highways and bridges under the proposal for the Ministry of Works, and some of these are new roads. Security budgets are usually treated as sensitive and off-limit but it is difficult to see the urgent need to spend N2.15 billion for the cladding of the Ministry of Defence Headquarters and other activities.
Also, there is a N50 billion allocated for “Renewed Hope” mini estates across the country. Apart from something being off about personalising what will be funded with public resources, it is difficult to see why a supplementary budget is needed for this. This late in the day, the legislature should be treating the 2024 budget while the supplementary budget for 2023 should be for only things that cannot wait. The way things are, the January to December budget cycle appears jettisoned.
It is concerning that the supplementary budget is light on details in many areas. Tens of billions of Naira are allocated to individual one-line items that are not self-explanatory. The only exception is the budget for the Ministry of Works, which accounted for seven of the ten pages in the supplementary budget. For example, there is no clarity about a N12.7 billion allocated under recurrent expenditure for the Presidential Air Fleet in the budget of the Office of the National Security Adviser. Is this for salaries, for parts, for aviation fuel? Is this for recurrent expenditure not previously budgeted or for supplementation?
Then, there is a whopping N200 billion allocated for contingency under Capital Supplementation. That is about 10% of the entire supplementary budget and 17% of the entire capital allocation under the supplementary budget allocated to a nebulous one-liner. Finally, the supplementary appropriation bill gave no indication of how the budget will be funded.
Based on the deep fiscal hole where Nigeria is and the growing hardship in the land, it is not too much to expect a little sacrifice and more sensitivity and openness from those in positions of authority today. We need a more appropriate tone from the top.