governance

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Reducing The Cost Of Governance In Nigeria by Olutayo Inioluwa.

  For any society to make notable progress there must be a government to run it affairs; Governance however goes beyond a means of providing common goods for the people. It can also be related to the management, supply and delivery of public services to a nation. The prosperity and development of any nation hangs and depends majorly on efficient governance. Therefore, to enhance growth and development, governance must be cost effective and efficient. Government In every nation, developed or developing is charged with the responsibility of carrying out some statutory roles such as performing political duties and discharging civil services to the public. However, there are costs incurred by government in running these administrative affairs. And to say that carrying out these responsibilities requires a huge amount of spending by the government is no exaggeration. Even so, an excessive increase in the cost of governance reduces the availability of public funds to support and implement the primary functions of the government which consequently impedes growth and development. Therefore, in a nation where the civil service is extra large and/or the government cabinet is larger than optimal there will be a rising cost of governance. Consequently, pronounced poverty and laggard development is a key feature of such society because for growth and development to take place resources must be channeled towards production. Hence, an excessive increase in administrative expenditures indicates that there will be a reduced proportion of resources available for productive purposes. An increasingly rising cost of governance will definitely have a negative effect on the productivity and industrialization of a nation, and generally a lessened finance for capital expenditures. This is the problem that stares at Nigeria in the face, because over the years, there has been an astronomical increase in the costs associated with running the government in Nigeria; with such recurring increase evident in almost all sectors of the economy. The high cost of governance in Nigeria is seemingly worrisome; and has become a challenge to the nation’s development. In the nations yearly budget, a very large percentage is always allocated for recurrent expenditures thereby leaving insignificant percentage to be set aside for production, infrastructure, industrialization, health, education, and other important areas that are necessary for the enhancement of the development of a nation and quality life for the people. Since 1999, the percentage of the total budget spent on recurrent expenditures as gradually increased. For example, in the 2010 national budget; of the USD28.75 billion, only a sum of USD11,15 billion was earmarked for capital expenditures. Similarly, in 2013, out of a total of USD30.75 billion only a pantry sum of USD19.38 billion was voted for capital expenditures. In the year 2012, 86.9% of the budget was spent on recurrent expenditures. In 2018 and 2019, the amount earmarked for recurrent expenditures also took significant lion shares from the total budget. The irony of it is that, instead of reducing this ever increasing administrative expenditures, every new government seems to increase it further than it inherited it from its predecessors to the utmost detriment of the nations development; This is aptly demonstrated in this year’s (2020) national budget, where of the 10.33 trillion naira budget, only a pantry sum of 721.33 billion naira was allocated for capital expenditures; a significant 23% decrease in the money plan of 2019. Given the fact that resources are limited, a significant increase in recurrent expenditures indicates that there will be a decrease in available funds for productive purposes. However, population increase has been one of the factors that affect the increase in the cost of governance. An increase in population indicates that there is pressure on the limited available resources; hence there is more demand for public goods and services such as security, health, education et cetera. Moreover, one of the major causes of the incessant rise in the cost of governance in Nigeria is the extra large civil service sector. In Nigeria the civil service sector is large, inefficient and also brings about exorbitant cost to the government. There is a need for restructuring in the Nigeria civil service sector; it needs to be reduced to a manageable but optimal size. A practical example is the Nigeria police force. The Nigeria police force by constitution is supposed to handle crime, but the crime Investigation department, was expanded and taken away to form the Economic and Financial Crime Commission (EFCC) and the ICPC; the anti drug arm of the police was also removed and expanded to make the NDLEA, the DSS was also previously an arm of police. Today the budget of the EFCC is higher than that of the police. There are other samples examples of these instances of duplication of functions. Therefore an important step to be taken in the reduction of the cost of governance is to look into these already established agencies and make appropriate rectifications, restructure and probably merger or scrapping of many agencies, instead of further establishing new ones. The cost of governance in Nigeria has become a worrisome issue that has continued to dominate the socioeconomic discourse. Highly placed government functionaries who have realized that high cost of governance deprives the nation of revenues that can be channeled towards developmental initiatives have had a thing or two to say about it; but beyond theoretical analysis and inferences, our government needs to really take actions towards reducing the cost of governance. They cannot keep saying we need to reduce the cost of governance and not anything as regards reducing it. For example in this year’s (2020) national budget, a whooping sum of 3billin naira was budgeted for the president and vice president travelling, not forgetting that the presidency still has more than six aircraft in his convoy. This really cast a doubt on the government; it shows that they are doing little or nothing about reducing the increasingly rising cost of governance. An appointed minister in Nigeria may have up to 10 special assistants, and special advisors, every special advisors also has an

Essays, Writers

Reducing The Cost Of Governance In Nigeria by Bolaji Alade.                                           

    Writer’s note: This piece examines the unfortunate effect of the high cost of governance in Nigeria extensively; identifies alternative usage of the mismanaged resources and suggest two effective solutions to the bane of the exorbitant cost of governance in Nigeria. Nigeria, like a coat of many colours, has different shades and all, rightly so. She is the Poverty capital of the world; One of Africa’s most indebted nation; Country with over 13 million out of school children; Third worst terrorist hit country in the world; Fourth worst place to give birth in the world, and a few other factually correct ignominious designation. Ironically, this nation that replete with underdevelopment and reeks of poverty-stricken citizens tops the chart of highest-paid lawmakers globally and by extension public officials. Pretty much ahead of large economies like USA, China, Japan and other economically stable countries. For accuracy, let’s consider verified figures. After all, as presumed, figures don’t lie. According to a 2016 report by Sahara Reporters, a top-flight news agency in Nigeria, 109 senators in Nigeria earn N1.85billion yearly, while the 360 members of the House of Representatives get N4.93 billion totalling about N6.78 billion in salaries, allowances and emoluments for Nigeria federal lawmakers annually. A huge contrast to the earnings of an average Nigerian worker. As of today, many states are yet to approve the payment of the new minimum wage of N30, 0000. Thus, for many workers who still earn N18,000, it will take at least four years before earning monthly utility allowance for one legislator according to the same report. One can only imagine the difference over 6 billion Naira pocketed annually by 469 individuals would make in improving the living condition of over 86.9 million Nigerians living in abject poverty. However, the legislative arm of government is not alone in the business of milking dry the nation of its insufficient resources. The executive arm of government is equally guilty. Security Votes which amount to an estimate of N241.2 billion annually is an unaccounted for and secretive, security funding mechanism operated by the executive arm of government across the three tiers—federal, state and local government. Different from the budgetary allocation for security agencies, the purport of Security Votes is ideally to supplement the funding made available to security agencies and to be disbursed at the personal discretion of the head of the executive in the public interest. But, the discretionary spending of these monies has been used for all purposes—diverted for political party funding, Political Campaigns, expensive vacations, personal enrichment etc.– but, the sole purpose: securing lives and promoting the welfare of the citizens. In context, the total annual sum of security vote is higher than The Nigeria Army budget; more than the total combined budget of the Nigerian Navy and Air force; Over 70% of the Nigeria Police Force annual budget; 9 Times Higher than the US security assistance to Nigeria since 2012, yet Nigeria is the third-worst terrorist hit country in the world, with 21 states recently declared by UK government as unsafe to reside. This begs the question, what is the impact of the security Votes on Nigeria security? No doubt, if we will get security right in Nigeria, such outrageous amount must be slashed, some of it pumped into the economy, for a blossoming economy would translate to a decline in crime rate and improved security. And the remainder, strictly monitored, should be added to the budgetary allocation for the security agencies and not extra funding in the exclusive control of kleptocrats to forestall further misappropriation of security-improvement resources. Most ridiculous is that wastage of the nation’s scarce resources has no regard for times and seasons. It was wasted in time of oil boom and now, sought to be mismanaged in a season of recession. Case in point is the N3.2 billion budgeted 2021 travelling expenses for the President, and Vice President proposed before the national assembly. Quite abysmal that at a time when Covid-19 has snuffed life out of Nigeria’s economy, and prices of food skyrocketed so much that three small onion bulbs cost an arm and a leg, and an all-time high total public debt portfolio of 31 trillion Naira without matching economic development, the sailors of the nation’s economic ship seek to lavish over three billion Naira on international tourism. An amount that if pumped into the primary health care sector, will provide standard equipment, structures and improved condition of service thereby ensuring a safer child delivery in Nigeria ranked fourth most dangerous place to give birth in the world. Needless to say how past government officials, say ex-governors in some states like Lagos, Rivers, Delta states, backed by extant law, earn jumbo salary and allowance years after exiting the office. In some instances, they’re entitled to renewal of at least two cars, and one house in the state they served and the other in FCT or any other state of their choice. A glaring effect of this misplaced generosity is Lagos State’s foreign debt of $1.49 billion and poor road networks in its suburb. Reduction of cost of governance in Nigeria is non-negotiable. It is the only modest thing to do. And knowing this truth, government officials of erstwhile and incumbent administrations including the Vice President, Professor Yemi Osinbajo, have been paying lip service to the imminent need for a drastic cut in the cost of governance without matching political will. While this can be very discouraging, it clearly shows the present crop of leaders lacks the political wherewithal to effect such a change. At least not when they’re benefitting. What’s the way forward then? Advocacy for Legal reforms; Political participation of servant-Leaders. It will interest you to know that expensive governance in Nigeria has its roots in an operative legal framework. That is, daylight robbery of the nation’s scarce resources is empowered by extant laws of the Federal Republic of Nigeria. Section 84 and 124 of the 1999 Constitution of the Federal Republic of Nigeria (as amended) provides that

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Give Me Good Governance Over Restructuring.

  They don’t know what they are talking about, I don’t believe in true federalism. What is true federalism? Why are they (the states) not accountable? What powers do they not have? They have power. In fact, state governors are more powerful than the president. That’s the truth. So if anybody tells you they want devolution or true federalism, he doesn’t know what he is talking.~ Olusegun Obasanjo With the above words, the Ebora Owu dismissed the calls for restructuring and true federalism in a chat with African Arguments published on 28th September 2017. The issue which has dominated the news agenda in the past few months is also being championed by none other than his arch-rival and former Vice President Atiku Abubakar who has made it the focal point of his renewed quest for the top job. In fairness to him, Obasanjo has never been a proponent of devolution. Understandably, this can be attributed to his background as a soldier. His time in Aso Rock was dotted by the tendency to centralise rather than decentralise power. He rode roughshod over perceived obstacles, deposing governors, senate presidents and a police chief as he strode boisterously around the country like a colossus. As usual many including yours truly will be quick to dismiss whatever is attributed to Obasanjo, but let us put the old soldier aside and critically interrogate his missive. Federalism comes in varying forms, that much I am sure most of us will agree with. The common denominator, however, is that all forms have a relationship of shared authority between the component levels of government as agreed by the federating units. No system of government is perfect, therefore nation-states keep evolving to adjust whatever system is practised to present day realities. Our federalism has been plagued by inter-ethnic rivalry, power-sharing and revenue allocation to mention just a few. The calls for restructuring are therefore not entirely misplaced, but some like Balarabe Musa has said that many chanting the song are doing so for selfish reasons. And truth be told, we have been restructuring since Independence, perhaps not in the manner many of the recent disciples envisage. But then again different regions have different interpretations and reasons for restructuring. Let us take a stroll down history lane to examine the pattern of the calls for restructuring. After Aguiyi Ironsi’s declaration of a unitary system on the 24th of May 1966, it is on record that the old Northern and Western regions were critical of the decree while the Eastern region remained silent. The North particularly was vociferous in their attacks and accused Ironsi of planning to foist Igbo domination on the entire nation. While Aguiyi dithered the North took their umbrage to the peak and assassinated him in Ibadan on the 29th of July 1966. It is pertinent to note that Aguiyi’s decree 34 did not strip the regions of resource control yet the North kicked because he was not their own. What followed was an extensive era of successive Military governments mostly headed by northerners that established revenue review committees. These committees more or less acted as morticians for the final cremation of the derivation principle of revenue sharing that formed the nucleus of our federal system of government. Indeed the lopsided centralisation of resources actually started when Awolowo, acting as Gowon’s Federal Commissioner of Finance reduced derivation on the recommendation of the 1968 Dina Commission. Despite the rejection of this by the Council of Commissioners of Finance from all the regions, the Gowon administration enacted decrees 13, 9 of 1970 and 1971 respectively which appropriated a large portion of exploration and consolidated revenue to the centre. The old Eastern region was disgruntled but coming from the defeat of a protracted civil war the region was too ravaged to utter a whimper. The Murtala and Obasanjo regimes even went further to allocate more to the centre. Murtala’s decree 6 allotted only 20% of oil royalties to the producing states the Federal Government got 80%. Obasanjo’s Aboyade Technical Commission vanquished the allocation to the Niger Delta as the centre retained 100% of mining rents and royalties This was the end of the road for derivation and what many perceive as the end of our fiscal federalism. Crude oil which then contributed over 70% to the national purse was taken from the states and federalized to be shared according to the whims of the man in Abuja. In all these years there was muted disapproval from especially the South East and South South but the notorious high-handedness of military rulers was enough deterrence to make potential agitators have a rethink. Our second stint at democracy did not solve the problem as Shagari retained the 100% derivation at the centre bequeathed by Obasanjo. It wasn’t until the 1995 Constitutional Conference during the Abacha regime approved a 13% derivation for littoral states that we began to see some semblance of a return to fiscal federalism. However, it is also noteworthy that cries of marginalisation by MOSOP rented the air from 1992 till the state execution of Ken Saro Wiwa in late 1995. Obasanjo’s second coming as a civilian president saw him abolishing the offshore/onshore dichotomy ruling of the Supreme Court in 2004 via an act of parliament. This ‘magnanimity’ elicited applause from the political elite of the Niger Delta and Akwa Ibom whose oil resources are virtually 100% offshore found itself in stupendous wealth. Once again the South relaxed on calls for restructuring. The Yar’adua era saw the South screaming again for federalism and when Jonathan took over the shouts automatically stopped in the South-South and South East. The South West continued screaming as the region was excluded from the top 6 elected positions in Jonathan’s administration. With Buhari’s victory coming from the alliance of the South West and the North, the pendulum has swung to the South East and South South to lead the screams for restructuring and even secession. I have taken time to elucidate this timeline so that it shouldn’t require sorcery to decipher that the volume of

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