This new sheriff’s challenging times By Emmanuel Nwachukwu

President Muhammadu Buhari

For some, the euphoria that greeted the election of President Muhammadu Buhari has begun to wane as hope turns to despair with the new economic realities. For many more, “patience, patience” seems to be the clarion call as the country awaits the appointment of cabinet ministers. With crude oil prices at a nine-year low and forecasts to remain at these levels in the short/medium term, Nigeria faces challenging times ahead to fund its budget requirements and infrastructure gap, estimated at over N50trillion.   Whilst we commend the President for his achievements thus far, not least the tone he has set on zero tolerance for corruption and the commitment he has shown in tackling terrorism, the nation and the business community are eagerly awaiting the composition of his cabinet, so that the work of governing can begin in earnest.

Corruption, incompetence, lack of accountability of public officers, poor corporate governance, and poorly thought-out policies have all played their part in where Nigeria currently finds itself. These ills have not been helped by a corrupt and slow judicial system that has rewarded offenders.

We need to begin to address the corruption and profligacy in our budgets, at both state and federal tiers of government. I am of the firm belief that the overheads budgets of Ministries, Departments and Agencies could be cut by a half with no impact on public services and the funds released to job creating infrastructure. The British Prime Minister, David Cameron, was recently photographed travelling on economy class by a fellow passenger – this is a country that gives aid to Nigeria, so that our public officials can travel first/business class to some bogus conference abroad.

Whilst the Nigerian National Petroleum Corporation quite rightly has been in the line of fire over corruption and poor governance, we need to begin to apply the same level of scrutiny to states and hold governors accountable for mismanagement of public funds.   The solution to the cash flow difficulties of some state governments is not in the Federal Government bailout but in the fundamental reform of the way states are run.

Mallam Nasir El-Rufai, to his credit, has started this exercise in Kaduna State with a forensic examination of the state budget, adopting the zero-based budgeting methodology. This exercise has thrown up useful questions, such as, the role of government in funding religious pilgrimages. Should government be funding these pilgrimages when we have enough Christian and Muslim billionaires who can fund these travels through charitable trusts? If state governments struggled to pay salaries when oil prices were over $100 a barrel, it will be foolhardy to expect them to pay salaries now with a depleted treasury and oil trading at below $50 a barrel. We must begin to examine through the budgeting mechanism what we spend our money on, how we spend it and where we spend it. We must ensure that budgets deliver the right choices for the people as well as hold public officials accountable for the use of public funds. Mismanagement and poor budget management is partly responsible for the non-payment of civil servants salaries.

As a country, we need to chart another path to economic growth that does not include oil, a path underpinned by zero tolerance for corruption. This will involve a new partnering arrangement between the public and the private sector to provide vital services and infrastructure. It will involve exploring new innovative ways of generating additional revenue, as well as reviewing the adequacy and effectiveness of the current systems of raising revenue. It will also involve the reform of our public institutions including the civil service to make this engine of government fit for purpose. Any reform of our public institutions must address the deep-rooted culture of corruption in the civil service, both at the state and federal levels.   Whilst the political establishment must take full responsibility for the current state of the nation, many commentators quite rightly place an equal, if not greater burden of shame, on the corruption in the civil service.   Together with politicians, corrupt civil servants have frustrated many a government’s attempt to implement good policies. They have deprived both state and federal governments of badly needed funds, charging and collecting revenues for themselves instead of government. Many projects remain uncompleted because of the pressure on contractors to give kick-backs, leaving contractors with little resources to complete the works. Unlike politicians who come and go, these individuals have a real permanence in government, led by the aptly titled ‘permanent secretaries’. To his credit, the Buhari administration has begun to address the issue of corruption in government. If you are a civil servant or public official today, you will be in no doubt that it is no longer business as usual.

The main gripe with this administration has been the delay in removing this dreadful policy called fuel subsidy. This policy has been singularly responsible for the mass impoverishment of Nigerians. In a recent conference in London on closing the funding gap in emerging economies, the audiencewere aghast at what Nigeria spends on fuel subsidy, compared to vital infrastructure that actually creates jobs. In 2014 for instance, about N1trillion, a quarter of the entire federal budget, was allocated to just one line of expenditure, more than four times the total capital allocation for health, education, power, works and transport put together. This is insane. If this same amount was invested in public infrastructure, over 25,000 sustainable jobs would be created every year. The poor would have access to better roads to sell their produce, access to better healthcare and schools and more sustainable jobs would be created for our youths, with the huge ripple effect on the entire economy. Instead, this money was shared amongst 130 or so oil marketers in the guise that fuel subsidy benefits the poor. Apart from perhaps a couple of big cities, most people in Nigeria, especially the border towns, have never bought petrol at the regulated price of N87. The choice for government is whether to continue to use our scarce resources to fund a corrupt subsidy regime or use it to create jobs for the millions of unemployed youth.

Whilst the challenges we face as a nation are deep and complex, for the first time in our history, there appears to be some seriousness and determination from the leadership to break from the past. As long as the President remains focused and surrounds himself with like-minded selfless Nigerians, his government may well go down in history as the point when this great nation finally turned the corner. I have great hope for Nigeria.