“If a man pays no heed to what is distant, he will soon find sorrow near at hand.” ~ Chinese proverb.
Nigeria has seldom been a country blessed with foresighted people. Perhaps, they would never have tried, if our “Founding fathers”, those who fought for our independence – Macaulay, Imoudu, Ahmadu Bello, Awolowo, Azikiwe and Enahoro – had known that we would today be an embarrassment to the black race.
But, alas! Here we are, barely able to keep the country from falling apart, and, now, tentatively held together by crude oil revenue – which, like most earthly gods, is now poised to let us down. Unless we can face the truth about the future, our leaders have failed in the past; and that is why we are in our present predicament.
Today, few states can pay staff salaries and all owe pensioners. Meanwhile, the Federal Government is setting a bad example for all. Pensioners’ funds are looted wholesale and some looters are provided with state security!!!
Nigeria’s “Golden Age” of oil occurred between 2009 and 2013. It was the era of late President Yar’Adua and ex-President Jonathan. The price of crude oil ranged from US$100 and US$145 at one stage. The average was close to US$110-115. It was also the period the country had the last great chance to diversify the economy and embark on the road to a nation less dependent on crude oil for its survival.
The opportunity was completely wasted despite having a former World Bank Managing Director as Finance Minister under Jonathan. The seeds of the destruction of the Nigerian economy which we are now experiencing were sown long before many of the Governors today knew they were going to be governors.
Given its orientation, the military leaders, Obasanjo and Abubakar, who foisted the “Killer” 1979 and 1999 Constitutions on us, could not see anything wrong in having a federation in which public servants in every state were paid the same. Since we borrowed the constitution from America, the least they could have done is to look at the remuneration packages of American states.
And, they would have discovered that, not only are Governors not paid the same salary in every state, all civil servants’ pay are decided by the people in each state, based on what the state can afford to pay.
By contrast, Lagos, Rivers, Akwa Ibom, Bayelsa, Delta and Kano – Nigeria’s six richest states, pay the same salaries and entitlements as the poorest six – Kwara, Ebonyi, Ekiti, Plateau, Gombe and Nasarawa. That is despite the fact that the top six, on the average collect 350 per cent of what the bottom six collect from the Federation account.
Let us forget for now that Lagos generates more Internally-Generated-Revenue than all the bottom twenty states put together. To state that the political arrangement makes no sense is being polite. It is closer to economic lunacy.
But, just as a well-dressed mad man is often difficult to spot, we did not realise the situation when the price of crude was $110-145. The problems began to show when crude oil revenue started to slide. Even then our leaders were not done with us and we applauded their actions – some of which are savaging our states today.
On Account of agitation by the Nigerian Labour Congress, NLC, ably led by Comrade Adams Oshiomhole, workers in the organised sector demanded wage increase, which was granted on the eve of the 2011 Presidential Elections. That measure apparently raised the Minimum wage from N7,500 to N18,000 per month.
That 140 per cent increase in wage bill and other entitlements was bound to have serious economic consequences, down the line. Already, by 2011 most states of this Federation were spending close to eighty (80) per cent of their gross revenue on salaries; those with huge debts were having deductions made at source; and there was very little left for development. Then, we collectively increased the wage bill across the country by 140 per cent.
Granted, most State Governors and NLC leaders are economic illiterates and the President of Nigeria, in 2011, holds a doctorate in Zoology; but, was that a reason why simple arithmetic eluded all of them? By increasing the Minimum wage to N18,000 per month the ball was set rolling for salary payment defaults nationwide. The high price of crude oil and the raid of the Excess Crude Account, ECA, from 2012 to 2014 postponed the days of reckoning until 2015.
Since then, bail outs and the Paris Club rebate have kept most of the states from economic collapse. When the last instalment of Paris Club rebate is released to the states, as they should be, and spent, the states and the people of Nigeria will come to terms with the fact that the political structure we have established can only be economically viable if the price of crude returns to over $110 per barrel. We will wait forever or for a major disruption in oil supplied from the Arab countries for that to happen.
“Humankind cannot stand too much reality.” TS Eliot, 1888-1965. Clearly, our favourite past time of blaming state Governors generally might provide emotional relief, but there is nothing more to gain from it. Sacking all the Governors will be a futile exercise from the standpoint of finding solutions to the perpetual problem of unpaid salaries.
We will merely exchange one person whose hands are tied for another. If a Governor must be sacked it must be for another reason personal to him and not for unpaid salaries. That is a fact irrespective of how unpalatable it might be for us to swallow.
We should also accept the fact that “You can’t bully reality”. The NLC has been flexing its muscles about increasing the Minimum Wage. It is likely that there will be a repetition of what happened in 2011.
Faced with a possible national strike in 2019, Buhari’s government will succumb to pressure and increase the Minimum wage. Unless aggregate national revenue increases to match the new wage increase, that measure will only accelerate the collapse of states economies. Even the top six might then find it impossible to pay.
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