- Urge Tinubu to avoid banana peels, target infrastructure
- Experts ask FG to fix nation’s data challenges to identify poor Nigerians
BY TIMOTHY AGBOR AND BRIGHT JACOB
Some Nigerians, including economists and policy experts, have disagreed with the Federal Government in its plan to transfer N8, 000 into the accounts of 12 million vulnerable and poor citizens over the next six months to cushion the effects of the removal of subsidy on petrol.
They asked President Bola Tinubu to shelve the planned cash disbursement and channel the N500 billion earmarked for palliatives to mitigate the effect of petrol subsidy removal on poor Nigerians to the provision of critical infrastructures, and fixing the nation’s moribund refineries among other concrete strategies.
Also, lawyers, human rights activists and politicians called on the Federal Government to fix challenges around the correct and up-to-date statistics of the nation’s population in order to ascertain the real poor Nigerians so that the palliatives would be judiciously utilised.
In their separate interviews with The Point, the professionals specifically charged President Tinubu to purchase buses to subsidise transportation for the masses, equip hospitals, construct roads and support farmers with enough funds to be able to cultivate for food security.
Some of them noted that the $800m loan, which Tinubu wanted to obtain from the World Bank, should be added to the monthly N500bn for palliatives to fix at least two refineries in order to make fuel price lesser in the country.
According to them, the N8, 000 cash transfer may be misappropriated by corrupt government officials just like the Trader Money disbursed during the administration of the immediate past President Muhammadu Buhari and other schemes.
“These things happen in other countries, if we share money, it will not have lasting impact. But by making social amenities available and affordable, people will not have to spend so much of their income”
An economist, Samuel Atiku, expressed worry over the failure of the country to have a reliable data base for its citizens and noted that unless the criteria for identifying the poorest of the poor in Nigeria are identified, the cash disbursement should be set aside while the palliatives should be tailored towards infrastructures and payment of better salaries for workers.
Atiku said, “In Nigeria, we have about 133 poor people, and for households that the government is looking at, we had 33 million poor households as at 2020 but for now, we are looking at about 45 to 46 million households. So, out of those 46 million households, we are looking at 12 million households. The first challenge is how do you identify the household? We have data challenges in Nigeria and we noticed that every attempt of the government in the past to disburse funds to the poorest among us had always failed because of failure to ascertain who is actually extremely poor.
“While some people will be able to say that they get something, the majority of people who are poor today may not get. I don’t think the fund that they are putting into this scheme is enough. Government should re-think this palliative and identify those who are really suffering extreme poverty. While that is being done, the money can be channeled into subsidising transportation for people and also subsidising food for people. Most pregnant women can’t even access quality health care in the rural areas and those in the urban areas can’t even afford the increasing health bills in the hospitals. So, this palliative should be tailored to these infrastructures and not just throwing money around and making some people steal from the poor.”
Another economist, Sunday Chizoba, was not pleased with the idea of N8,000 for households, stressing that food items are very expensive now and that the N8,000 would not last two days for a household.
He advised the Federal Government to embark on massive investment in agriculture and provide critical infrastructures in health, education, economy and security with the palliative funds.
“The announcement of the N8, 000 cash transfer to poor households is vague and thoughtless. As an economist, I can’t find any logic in it because past efforts like this had always been misappropriated by corrupt officials and this is because there is no data to actually identify the poor people and no defined strategies to reach out to this targeted audience.
“More so, I would want to advise the Federal Government to set aside the disbursement for now and embark on practical and massive investment in agriculture. For us to take the government seriously as we battle the ugly effects of this subsidy removal, they should just reduce the cost of governance. Aside from investment in agriculture, critical infrastructures should be provided and hospitals should be equipped and workers motivated through salary increment,” Chizoba opined.
A former Director General of the Abuja Chamber of Commerce and Industry, Chijioke Ekechukwu, said that the government must ensure that funds meant for interventions were spent on what would reduce the burden of Nigerians, especially the low income earners.
For him, disbursing palliatives in the form of cash or increased salaries may not benefit the Nigerian economy as it will lead to higher inflation.
“I do not believe that palliatives should be in the form of money, or increase in salaries because this will in turn increase inflation rate. But we can push these interventions to fund quality education, especially at the primary and secondary levels. This will remove much burden from parents. We should also use the money to fund health care, empower our hospitals to offer free health care services for certain ailments. This way, Nigerians do not spend so much on health care.
“These things happen in other countries, if we share money, it will not have lasting impact. But by making social amenities available and affordable, people will not have to spend so much of their income,” he said.
The Director, Centre for the Promotion of Private Enterprise, Muda Yusuf, said the hardship mitigating measures could be classified into immediate, short-term, medium and long-term. “Such responses would send the right signals to citizens and demonstrate the government’s sensitivity to the devastating impact of the subsidy removal on the poor,” he said.
According to Yusuf, the cost of transportation, which is critical to the survival of most citizens, has increased by 20 to 50 per cent.
He explained that the hike in transport fares and the corresponding inflationary effect were already posing a threat to the livelihood of many, both within and outside the public sector.
“Wage earners, small business owners, informal sector operatives, artisans and the unemployed are all very vulnerable in the current circumstances. This is the context in which the government needs to urgently respond to the current crisis, focusing on the scope of impact, effective targeting, inclusion and the right messaging.
“Immediate panaceas need to be activated, not just with respect to transportation costs, but also the surging cost of living generally,” he said.
He said all agricultural inputs, including machineries, agrochemicals and fertilizer, should attract zero import duty and zero VAT, adding that this would boost investment in agriculture, especially commercial agriculture.
He also stressed that gross monthly salaries of N200,000 and below should be exempted from payment of Personal Income Tax.
“This will give the low-income earners some room to improve their spending capacity and reduce poverty. Citizens have demonstrated an incredible understanding, tolerance, patience and resilience. The government cannot afford to overstretch this gesture and cannot afford to be perceived as taking them for granted. Reciprocity by the political leadership at all levels is urgent, exigent and crucial,” he said.
Also, the Executive Director, Civil Society Legislative Advocacy Centre, Auwal Musa Rafsanjani, urged the Federal Government to avoid any attempt to promote fraud under the term ‘palliative’.
“We have had governments in the past that diverted funds made for purposes like this for other businesses. Those funds did not get to those that needed them. We do not need that kind of situation to continue; whatever we do must be to support the people of Nigeria.
“Palliatives or support should be in critical areas like transportation, healthcare system. Accessing healthcare has become costly and nearly unaffordable. So palliatives should be in areas that are of great need to the people like provision of clean water, quality education.
“Disbursing cash will not address the issue but what we need now are efforts that will reduce poverty in Nigeria,” he said.
Rafsanjani, who heads Transparency International in Nigeria, also noted that another reason for kicking against the disbursement of palliative is due to the lack of transparency by successive governments, which according to him, was seen during the Covid-19 pandemic.
He said there had to be a guarantee of transparency in the disbursement of this new palliative, adding that the palliatives should be disbursed through the 774 local government areas in the country, at N1.04 billion per local government.
A financial expert, Gbenga Adeoye, also asked President Tinubu to halt the plan by his government to distribute N8, 000 to 12 million poor Nigerians in six months, saying the President would not be able to cushion the effect of subsidy removal through this.
While alluding to the fact that Tinubu was prepared for the job, owing to the actions he took immediately after he assumed office, Adeoye, however, said, “I have been disturbed by the plan of the Tinubu government to give N8, 000 cash palliative to 12 million poor Nigerians for six months.”
Explaining why the cash palliative should be avoided, the Chartered Accountant said that N8, 000 to 12 million Nigerians would amount to N96 billion a month and N576 billion in six months.
“Cash palliative does not befit a country that has not reached optimal production level, it is good in a country that has attained optimal production level but the people are restricted from going out to work. An example of such is the United States of America where cash was distributed during COVID-19 restrictions because people could not go out to perform their economic activities,” he explained.
In his recommendations, the tax expert suggested that the Federal Government should acquire 200 buses per senatorial district at N30 million per bus, stressing that N666 billion would be spent on acquiring 22,200 buses.
“This will reduce the cost of transportation if handed over to relevant stakeholders to manage. Ensure regular maintenance and run it as a pure business but regulate the rate, based on locations. Make monthly tickets available. Use cards over time like in OYSTER Cards in the UK.
“Ensure there are savings from the income generated from the buses to be able to replace them after five years. Let no politician use the bus for free. All Nigerians will benefit from this as most people will no longer have to worry about the high cost of petrol,” he stated.
The lawyer also suggested giving N1, 000,000 to 600,000 entrepreneurs, who will engage in petty businesses and will be able to employ four other Nigerians.
“The money, he said, should be paid back over a period of 10 years at a two or five per cent maximum rate and if possible, at no interest since the N576 billion proposed by the Federal Government is a free gift anyway.”
Adeoye noted that this would create three million direct and indirect jobs.
Expressing further concerns about the planned N8, 000 palliative, he asked: “How do we determine the poor Nigerians? How do we ensure the spread across the country? What will N8, 000 do monthly?”
The UK arbitrator said, “In my considered opinion, that move will not solve the poverty problem and hardship arising from fuel subsidy removal. To give N8, 000 per month is to give N266.67 per day. This will not produce the desired result as it means giving less than N90 per meal if it is assumed that the so-called poor will eat three times daily.
“The worst aspect of cash palliative is that people return to their level at the end of the programme, and that will cause more havoc after six months and can lead to unrest.
“Lastly, I repeat, Mr. President, please do not give out a cash palliative of N576 billion. The amount is too much for such and the two alternatives enumerated above will have better impact than N266.67 per day to 12 million Nigerians.”
A human rights activist, Ayo Ologun, demanded the fixing of two of the nation’s refineries in order to lessen the price of petrol with the palliative funds, saying it would assist in mitigating the hardship caused by the removal of fuel subsidy.
He said, “This is the problem we have with our leaders, lack of intelligent thinking. There is no way we want to justify the 12 million households the Federal Government wants to give this money. If our population is put at 200 million and you want to give only 12 million, what’s the percentage of 12 million out of 200 million when we know that more than 80 per cent of Nigerians are living below the poverty line? So, you have 12 million out of 180 million people. What happens to the rest?
“This is just the Federal Government repeating the same mistake because this was the same problem we had under the Buhari-led administration and Osinbajo was going around the markets giving money, which could not be accounted for, to people. So, President Tinubu is starting another journey that can’t be accounted for.”
While noting that the cash intervention might bring about litigation between the Federal Government and state governments over the size of beneficiaries, Ologun asked President Tinubu to cushion the effects of the hardship through revitalisation of the nation’s refineries.
He stated, “Why do you want to put unnecessary legal tussles on your neck at the inception of your administration? Why do you want to create an unnecessary crisis? What a serious government or people should be thinking of for a President is what to do with the money that can be of eventual benefit to the entirety of the people.
“What stops us from putting that N3 trillion to the rejuvenation of two refineries which would make fuel cost lesser and then we can go back to where we are coming from and then life can be easy since petroleum subsidy removal brought about the reasons for palliatives in the first place? I can tell you that this is another means to create food for some people in government and if this government is not careful, this would be the beginning of crisis.”
“The worst aspect of cash palliative is that people return to their level at the end of the programme, and that will cause more havoc after six months and can lead to unrest”
A policy analyst, Lanre Fadahunsi, said the N8, 000 would only amount to a drop in the ocean and asked the Federal Government to increase it.
“We deserve better as a nation. If you want to share N500 billion, every household must get N44, 000 per month, and now, you want to give them N8, 000, what happens to the rest? This is not mitigation of hardship; this is feeding the already fed public office holders,” he claimed.
In his submission, a lawyer, Moses Obaditan, opposed the sharing of the N500 billion intervention funds and suggested that the money should be spent on education, agriculture and health.
Obaditan asked state governors to drag the Federal Government to court in order to stop the planned N8, 000 cash transfer.
“I oppose sharing money to a few Nigerians. What we are told is that 133 million people are poor and you are now taking 12 million, how did you arrive at the statistics? For me, this is another leaking pipe in which the political boys will enjoy just like the Trader Money. So, I would just advise them to use the money on health, education, and infrastructure. State governors can go to court and restrain the Federal Government from sharing the money,” he noted.
A politician, Abosede Oluwaseun, warned against embezzlement of the funds and charged the Ministry of Humanitarian and Disaster Management to ensure that the poorest of Nigerians got the money, saying the proposed N8, 000 was small but “better than nothing.”
He said, “I would just advise the Ministry of Humanitarian and Disaster Management to ensure that the N8, 000, as poor as it is, gets to the poorest Nigerians. They should not put those who will embezzle the fund in charge of it. The Federal Government should work with religious leaders and traditional rulers to ensure that the money gets to where it is meant to reach. It is still better than nothing, even though it’s meagre.”
A Port Harcourt-based chartered Accountant, Ifeoma Ogbonna, said that the controversy and backlash, which followed the sharing of palliatives during Buhari’s regime, should be avoided by Tinubu’s government.
According to Ogbonna, the palliatives should be done through disbursements. In her assessment, doing it digitally as announced by the government would have been a great idea, but she fears most poor homes don’t have bank accounts.
Furthermore, she said the most vulnerable in the society should be considered, not necessarily workers. Ogbonna said, “You know the last disbursement supervised by the immediate past administration was fraught with controversy. You will recollect the former Minister of Humanitarian Affairs, Disaster Management and Social Development, Sadiya Umar Farouq, was handing out money herself. She was physically going to open grounds and schools, asking people to be on queues before sharing palliatives.
“People raised objections to the way she went about it, with many saying that bank account numbers of the recipients should have been provided. Others said most of the disbursements were concentrated in the Northern part of the country because Buhari was from the region. All of this led to accountability issues surrounding the whole process.
“I think the subsidy palliative should be done via cash disbursements. I would have preferred it to be done digitally, too, like I heard the government said they would do, but how many poor people have bank accounts in Nigeria? Even some of us who have offices or work, our accounts are dormant now because of inactivity. Nothing is happening with them.”
She added, “I would have also suggested a salary increase, but what are we talking about here? There are people who don’t even have salaries they can call theirs at the end of the month. I’m talking about the unemployed and the most wretched of the society. Frankly, these are the ones who really need palliatives the most, if you asked me.
