Beyond distribution of palliatives, by Yusuf Alhaji Lawan
I fondly joke with a senior colleague, an economist by profession, that impacts of studying Economics do not manifest in Nigeria as if there are no economists in the country. His response was always that economists are supposed to be the policy makers, but they are not carried along in decision making, hence the contemporary economic woes.
The economy of the land is unique. Unique in the sense that it seems to defy economic policies over the years, that’s why it remains static and in shambles interminably. Looking at the reality, one cannot confidently say this is the economic system practiced. With my close to two decades post degree experience, I cannot vividly remember a time that citizens celebrate an ease on the economy. The downturn steadily continues by the day.
The partial provision of petroleum subsidy in the 2023 Appropriation Bill informs that the subsidy regime likely comes to an end. The concern of the masses may not necessarily be about the removal of subsidy, but possible negative consequences it will pose. I am sure the government understands the vehemence. Adequate preparations should have been out immediately to equate the scaring thoughts.
Unfortunately, the reverse is the case as the fear is justified in the citizens. Today, patriots battle with high rate of inflation and reduced purchasing power. The governments seem waiting to be pushed to undertake constitutional responsibilities. This gave rise to the thwarted NLC/TUC planned nationwide strike shortly after the increase in pump price, nationwide protests, two days warning strike and the heightened industrial disharmony.
In response to the public outcry, the Federal Government rolled out plans for the alleviation of the suffering which among others is the release of Five Billion Naira to each state government to secure and distribute palliatives to mitigate the negative effect of the subsidy removal on the populace. A good number of citizens have low confidence in getting the desired result through this. However, those that have expressed reservations on the program were proved right afterwards.
In some states, items distributed as palliatives to “lucky” citizens cannot feed a menage for a meal. In some places, the palliatives dispatched do not worth a thousand Naira per a family. A particular Governor was on air assuring his subjects that palliatives would reach them, unveiling his good plans on ground and dishing out threats on anyone found diverting the palliatives to be ready for jail. In his state capital, some households got a sachet of spaghetti and macaroni each. Some a sachet of spaghetti and two sachets of instant noodles and other combinations. Residence now await seeing his wrath on those that handled the distribution if what was distributed isn’t his intended offer.
In a discussion recently with a former Chief of Staff to a Vice President of Nigeria, while I was lamenting situation of things in the country, he informed me on how the administration of former President Shehu Shagari once fought inflation with importation of foodstuffs into the country which forced the prices of local foods down and Nigerians had a fair deal in the process. Although, this may have its negative consequences too, but the positives tend to be more. If government can have a mechanism of ensuring reduced prices of foodstuffs in the market, it would do a lot of good far better than distribution of two measures of rice or it’s like to a negligible percentage of households.
During the days of Mrs. Kemi Adeosun as Minister of Finance, there was a day she featured on NTA Good Morning Nigeria show, in the course of interaction, her view was sought on tax increment. She vehemently rejected, instead, she opined that it is better to increase tax compliance. She explained that if tax is increased, the same people that comply with the payment would continue to pay while those not paying would remain evaders. That the difference needed can be obtained from increase in the compliance. Considering an option of tax holiday/reduction on critical commodities can do a magic.
Energy is an essential commodity that people are used to and cannot do without. Sadly, governments watch while the cost of electricity keep soaring up as if there are no regulatory agencies. Weight and Measures Commission, Consumer Protection Council, Civil Society Organizations are also unable to do enough on this aspect. A neighbour on direct billing is sometimes charged as high as N30,000 per month in a private apartment. Creating a way of ensuring reduced cost of energy would provide more relief than distribution of sachets of grains to families.
Exploitation of Nigerian banks on customers is always an issue to ponder about. They do not grant loans that can help secure a good outing due to high interest rates. The “fair” ones charge as high as 24% per annum. A friend was lured into applying for a loan with 4% interest rate, until after the disbursement that he discovered the 4% interest rate was monthly. He ended up paying N48,000 as interest on a principal amount of N100,000. Making arrangements for interest-free loans to private individuals, businesses, civil servants, etc. who have capacity to repay within a timeframe can minimize the negative effects of subsidy removal to an extent.
With a display of commitment from government on the plight of the poor, angel investors and social entrepreneurs have important roles to play in the resuscitation of the falling standard of living especially at this time that many live below poverty line.
Despite this soaring economy, the Federal Government still deems it fit to increase the school fees of Federal Unity Colleges to an unaffordable amount that an average Federal civil servant cannot enrol a child. A particular public university charges as high as N350,000 per session on students whose parents are waiting for palliatives from government. This should have been an avenue for government to crash down its charges on all public institutions to a bearable amount. It is still fresh in the minds that early this year, the Federal Government approved an upward review of Third-party motor insurance with 200% without recourse to the performance of the major stakeholders of the industry or the affordability as if it is a crime to own a vehicle.
While I was growing up, my mother talks about Government Cooperatives. These are mega shops that sell at relatively lower prices to those who care to patronize them. Now they are no longer in existence. In the present Nigeria, such needs to be revisited. Cooperative societies are self-help business organizations that assist members to save, secure credit facilities at a low interest rate, purchase goods and services at a reduced price by elimination of middlemen in the distribution chain. Consumer cooperative societies and Multipurpose cooperative societies are to be encouraged at formal and informal settings. They can also help greatly. There should be sensitization and proper guidance on their establishments at different levels. They have key roles to play in economic improvement.
Numerous opportunities are glaringly clear for governments to explore in ensuring a fair life for the citizenry that would guarantee favourable economy aside distribution of meagre items as palliatives that cannot make any meaningful difference in the lives of compatriots who have hope of succour from the government. Except when genuine, serious and urgent steps are taken to address the issues, the future of the nation is gloomy.
May God open the eyes of our leaders to see far, think outside the box, introduce and implement invaluable policies that would be of good to everyone.
Lawan, a public affairs analyst writes from Hausawa Asibiti Ward, Potiskum Yobe State. The writer can be reached via nasidi30@gmail.com.
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