BY Tope Fasua
As I type this, many Nigerians – especially the more comfortable, social media-savvy ones – are freaking out over the plans of the federal government to pay N8,000 monthly to 12 million families for six months to assuage the pains of the deregulation of the downstream petroleum sector, which had led to the tripling of fuel prices, as well as the floating of the naira which saw official exchange rate jump from N461 to around N780 today. Both serious decisions have resulted in some sort of triple whammy, ramping up inflation to perhaps 20-year highs, with promises of more to come. I believe there is a need to explain what is going on and let Nigerians know that we can still rescue the scenario.
Moreso, the Tinubu government still has many opportunities to make Nigerians happy and that it shall do, after all this is the government of renewed hope. I personally promise to continue writing and speaking and doing everything to ensure that the government stays rooted and focused and that it delivers on its stated goals especially to improve the lives of Nigerians and grow the economy.
Now, personally, I don’t like the idea of handing out cash to people in the name of solving the poverty problem. The issues are well known, and they include:
On Wednesday, July 12, 2023, at 7am, I was promptly at Channels TV at the invitation of Seun Okinbaloye, who had called me a couple of hours before then – as he usually does. No notice. The subject was about the much-awaited palliatives that the government had announced that afternoon. The sum of N500 billion was earmarked and was to be vired from provisions made for capital items in the supplementary 2022 budget presented by former President Buhari and approved by the National Assembly. The supplementary budget was necessitated – according to the past government – by the need to restore the lives of millions of Nigerians adversely affected by last year’s floods. In my response, I commended the idea of taking from the N816 billion supplementary budget and hoped that this was the beginning of good things to come. I also stated that I hoped the government will not be distributing it as cash among poor people as that was inflationary, among other issues.
The next day – July 13 – details emerged that indeed the government would be disbursing cash to 12 million families. I equally got a lot of questions from sundry quarters, and I expressed that I thought it was grossly efficient on some of the social media platforms I belong to (especially WhatsApp). Some people argued back and some of them were the neoliberal people who believe in mad efficiency and have never given a thought to the wellbeing of our poorest. I was surprised. How could these guys who don’t give a toss about the poor suddenly support cash transfers? Of course, they know the idea is super inefficient!
I should say that one of the comments I dropped in my social media discussions was how somebody who should know called me after an outing at AIT and informed me that the World Bank was insisting on Nigeria disbursing the $800 million loan it was giving us towards the palliatives, as cash to poor people. This person said that though he has been involved in most of the meetings, the Nigerians do not want to take the loan but the bank insists. This drops the ball squarely at the feet of the World Bank. Recall also my article of a few weeks back where I wrote about issues of moral hazards and conflicts of interest.
So, why did the Tinubu government go ahead with the loan, which is specifically to be disbursed as cash? It could be because the processing was too far gone for it to stop. It could also be because the World Bank is extremely powerful and without sorting out an ongoing transaction Nigeria cannot move on to the next. Another possibility – which is even more credible – is that just as the Tesco advert says “every little helps”. I believe that the Tinubu government is a very intellectual government and having got rid of two elephants in the room, it will roll out ideas upon ideas to make the lives of people much easier.
This N500 billion is certainly not enough but is just the beginning. It is certainly inflationary, but it is better than nothing. And we cannot keep discussing the matter of palliatives without doing anything at all about it. Since there was a low-hanging fruit that is already approved for disbursement, why not go for it? I am only thinking that this is the Tinubu government’s thinking. I am not involved in the decision-making process. But in spite of these challenging times, I still have hope that the Tinubu government will do things differently and achieve results. However, where we need to correct the government or give feedback from the streets, we should not hesitate. I will not.
My suggestion to World Bank and Nigeria
If we must borrow the said amount from World Bank, and if we must use the funds for emergency poverty relief for those who have been very adversely impacted by recent reforms, I would have suggested that rather than distribute cash, the government should mount a programme of purchasing food from our farmers to distribute to people around the country that actually sleep and wake up in hunger.
Whereas this idea could be inefficient too – as government operatives and politicians have been known to hoard food meant for poor folks and the process of purchases could not be devoid of padding and other shenanigans – the idea is a far sight better than just distributing cash (even if the said cash is disbursed electronically through e-Naira for instance.
The following can be achieved with a government-led food purchase and distribution project, as is done in the United States, India and other countries:
I like this idea because of its transformative potential even if it is hardly perfect. Every year and all over the country, we waste food. In Benue, massive amounts of oranges and other citrus fruits waste, yearly. In the Jos area, strawberries, apples and other fruits get abandoned. In Kaduna, mangos are left to rot on trees. In the Osun area, and all over the southwest, fruits are abandoned in millions by the roadside yearly. And before someone says this is a socialist idea, here are links that show that the most-capitalist country in the world has a permanent programme targeted at food purchase and distribution to the most vulnerable people in the United States with a program named The Emergency Food Assistance Program (TEFAP).
I quote from one of the articles:
“The USDA Agricultural Marketing Service (AMS) conducted the Food Purchase and Distribution Program (FPDP) during Fiscal Year 2019 (Oct. 2018 – Sept. 2019) and Fiscal Year 2020 (Oct. 2019 – Sept. 2020). The program was one of three USDA trade mitigation programs aimed at assisting farmers suffering from damage due to unjustified trade retaliation by foreign nations… Under FPDP, over the course of these two years, USDA purchased about $2.3 billion of a variety of U.S.-produced agricultural products impacted by trade tariffs normally going to export markets. USDA purchased food products produced on American farms by American farmers through approved vendors who had proven they were able to supply U.S.-produced products. The commodities purchased and the amounts of each were based on an economic analysis of the damage caused by the tariffs. Most of the food purchased was provided to states for distribution to the network of food banks and food pantries that participate in The Emergency Food Assistance Program (TEFAP). In the first round of trade mitigation, during the fiscal year 2019, USDA was authorized to purchase up to $1.2 billion of food products. This round ended in September 2019 with about $1.1 billion spent on foods for distribution. In the second round, during fiscal year 2020, the program was authorized to use CCC Charter Act authority to purchase up to $1.4 billion of surplus commodities affected by the tariffs. This round ended in September 2020 with about $1.2 billion spent on foods for distribution.”
Having established that a food programme is infinitely better than cash distribution (and one is left bewildered by why the World Bank is not helping to push such an idea as they have in their country of abode), I want to conclude by begging President Tinubu not to take his fingers off the pulse of the country.
He should please rein in excesses in government, show example by sacrificing some of his own benefits, rein in the national assembly, declare at least one year of asceticism in political quarters, let us have a moratorium on all these luxury goods purchases in government (especially exotic cars), and declare a programme to curb unruliness, indiscipline, destruction of public properties (in the name of anger against the government), destruction of Nigeria’s image home and abroad through drug dealing, cultism, and online fraud, corruption, bribery, and extortion everywhere (especially at our airports and sea ports), and other such behaviours with which we have continually ruined our chances and cast ourselves as swine before the rest of the world.
Without dealing with these issues, we labour over the economy in vain. Yet, we can work and chew gum. A massive reorientation program involving the youths and creating thousands if not millions of jobs, should be launched. This government must not fail. It shall not fail!
This website uses cookies.