The recently announced palliative measures aimed at cushioning the effect of the removal of fuel subsidy on poor Nigerians are most insensitive and unacceptable. Not only is the premise wrong, the policy is also not well thought-out. Obviously, it is not the solution to the problem it was meant to solve. According to the Federal Government, N8, 000 will be given to each of the selected 12 million households as palliative. This will run for six months. It translates into N48, 000 per family for the six months. For an average family of five, it amounts to about N53 per day or N1, 600 a month for each member of the family.
To achieve this programme, the Federal Government got approval for a supplementary budget of N819 billion from the National Assembly. It also got approval for $800 million facility from the World Bank. The sum of N500 billion was earmarked for palliatives for the 12 million Nigerians. The government also earmarked N70 billion to support the working conditions of the new members of the National Assembly and N35 billion to the National Judicial Council (NJC).
As expected, many concerned Nigerians have roundly criticized this programme. At first, how did the government arrive at the number of beneficiaries it mentioned? How did they arrive at the data of these 12 million people? After six months, where do we leave the beneficiaries?
We have gone through this route before. Under President Muhammadu Buhari, we had the National Social Investment Programme (NSIP). Under the NSIP, we had the Conditional Cash Transfer (CCT), the N-Power programme, the National Home Grown School Feeding Programme (NHGSFP) and the Government Enterprise and Empowerment Programme (GEEP). Over N1.358 trillion was invested in these various programmes under the NSIP between 2016, when it was established, and 2022. Over 15 million lives were said to have been impacted. Under the CCT, N5, 000 cash was given to selected vulnerable Nigerians every month. This pales to insignificance when compared to the huge number of Nigerians living in penury. Over 133 million Nigerians reportedly live in multidimensional poverty.
The new palliatives will not even scratch the surface of the problems Nigerians are facing. Today, the high cost of living has crippled millions of Nigerians. The price of fuel has gone beyond the reach of many Nigerians. It was about N185 per litre before the inauguration of Bola Tinubu as President on May 29, 2023. At inauguration, the price jumped to over N500 a litre. A few days ago, it went further to over N600. This has had a spiral effect on many other things. As of June this year, the rate of inflation was 22.79 percent. This happens to be the highest since 2005. As of June 2022, the rate was about 18 per cent. Besides, this programme is prone to corruption. How do we guarantee, for instance, that it will not go the way of the sharing of COVID-19 palliatives of 2020, which was shrouded in allegations of corruption and omission of millions of eligible poor families? Allegations of corruption also trailed the NSIP of the Buhari administration. Even the National Assembly at a point described it as a scam.
Let the current administration learn from the mistakes of the past. We think this current palliative should be suspended indefinitely. It’s good that President Tinubu has directed that it should be reviewed. But, whatever the reviews may be, the policy framework should be right. There should be wider consultation and there should be transparency in the implementation of the programme.
There is a need to go back to the drawing board and do something that will take Nigeria to the next level. Government should do background checks before embarking on any project. Section 41 (1) (a) of the Fiscal Responsibility Act says on no condition should we borrow money for recurrent expenditure and that government at all tiers should only borrow for capital expenditure or human development. This palliative is a recurrent expenditure and has nothing to do with human development. We should not borrow to implement it. Rather than dish out cash that is subject to abuse and corruption, government should fix the refineries. This will make the price of fuel to come down.
Government should also provide efficient transportation system that will reduce the burden of the cost of transport on the people. The move by the government to deploy CNG-powered vehicles as well as electric buses and cars with charging infrastructure across the country is a step in the right direction. Government should also invest in the health and education sectors of the country. This will have a greater impact on the generality of people than this cash project. Provision of constant electricity will help businesses which in turn will employ more people and help reduce poverty in the country. We should be thinking of sustainable programmes that will lift the economy, not a flash in the pan programmes that will end up enriching a few people.