Public petition on 2019 national budget (II)

This is a continuation of our public petition challenging the attempt by government to reduce the size of the budget in 2019 in the face of a growing population and inflationary erosion of the value of the Naira.

It is imperative to do this because of the way things play out in Nigeria. Every budget proposal is subjected to at least 9 months of back-and-forth which has nothing to do with how the people will benefit better from such proposal but everything to do with who can insert pork-barrel items into such proposals. This year’s initial budget was N8.6 trillion before members of the National Assembly increased it by N500 billion by adding loads of their own ‘projects’ into it. We are indeed in a state capture and the time to reject this whole shebang, is NOW!

Further analysis of our 2019 budget proposal shows that the absolute dollar value dropped from $25.2 billion (N9.1 trillion divided by N360=$1) in 2018, to $24.7 billion (N8.9 trillion divided by 360). However we need to discount this Dollar value by the US rate of inflation of 3%. Still the REAL Dollar value of the 2019 budget is $24 billion. If we consider the erosion of value as described above, per capita budget – or budget per person – drops from $140.4 per annum (or $0.38 a day), to $117 per annum for 2019, or $0.32 a day. This is what the government plans to spend on salaries, pension, infrastructure, education, security, health, environment, agriculture and every other thing it budgets for, per Nigerian in the year 2019. This is unacceptable because even within Africa, Ghana budgets $492 per person for the year 2018, Cote D’Ivoire $532, Cameroun $342, Gabon $2,449, South Africa $2,672, Morocco $838, Egypt $715, Algeria $1,467 and Angola $1,880, to name a few. It needs to be emphasized that a dream precedes any great achievement, and the budget of a nation being its most important dream, year on year, tells a story of where that nation is heading.  All the nations mentioned above seem to be powering on faster than Nigeria and this is reflected in everything else. Nigeria is however only not dreaming big enough, but the dreams of our leaders for the country seems to be in solid reverse.

I have heard it asked; ‘so how do we fund this big budget figure?’. First of all, a budget of N15 trillion is not big for Nigeria because it only translates into $225 per capita for each Nigeria – except if we are admitting that our population figure is over bloated. We also have to question whether truly we are the largest economy in Africa, or simply the most chaotic. Chaos and noise do not translate to substance. I want Nigerians to know that mass poverty is not a destiny and that we can do a lot better than we are right now. Figures don’t lie, and we should be giving our leaders marching orders IMMEDIATELY to produce the kind of results that other countries even in Africa are achieving or no deal. We must not look at our economy with the eyes of the present. We must forget everything we know about this economy and consider it with the eyes of a new CEO that has been headhunted from a rival, successful organisation. If that is the case, the first benchmark is to look at other countries and decide to at least match them. It is certainly not acceptable in the very least, for Nigerian leaders to be saying to the poor, suffering people of this Republic, that we have to budget LESS for next year, when population is growing and inflation is eating rapidly into the value of our money.

How do other countries generate revenue to drive their budgets?

The time has come to ask this question and find answers. Nigerians are the most travelled people perhaps in the world. Some questions confront us in this country; how do other countries generate revenue? How can Angola generate from its economy, more than twice Nigeria’s revenue, and drive more than twice our budget for its 25million people? How can South Africa budget 6 times what Nigeria does for its 60million people? And how is it funding that budget? A highly-respected person once said rather than being truly the largest economy in Africa, Nigeria is actually akin to a large grapefruit with little juice. Is this our reality? Can we never do better than this? I believe we can. I believe we must. And the time is now. I would wager that our biggest problem in generating revenue is the entrenched interest factor. Emir of Kano, Muhammad Sanusi II, had mentioned this once, among others, in a TEDx Talk. The entrenched interests, otherwise known as principalities and powers of Nigeria, should be made to see the negation of their own enlightened self interest, because even within the context of Africa, they have only succeeded in keeping us all down. They can make more money than they are right now, if money was the problem. What is unacceptable is the present state of our affairs.  The incredibly tiny budget is a mere symptom of a more endemic malaise.

I will proceed to explore ways in which Nigeria can generate revenue to finance the proposed, ‘ambitious’ N15 trillion budget;

1. FIND THE PIB  – Yes, let’s start from here. Crude oil is Nigeria’s biggest source of revenue. However in this sector we are seriously suboptimised. Reaching a compromise with International Oil Companies on the Petroleum Industry Bill (PIB) does not have to be so onerous. We cannot also brag our ways to glory in this area. The reason why Angola is doing twice our budget is that that country somehow got its crude oil laws right. In Nigeria, we messed up due to corruption but we are at the very turning point right now. Barrister Femi Falana is in court with Nigeria over the treatment of Production Sharing Contracts with IOCs. The clause that requires that we review such contracts be reviewed if crude oil price exceeds $20 has not been invoked. Ditto the clause that grants a 15 years concession for zero royalty on all production from wells deeper than 1km has not been vacated since 1993! The efforts of Falana have met with a brick wall. Nigeria has lost more than $60billion so far according to no less than the Minister of State for Petroleum, Ibe Kachikwu. See https://www.thisdaylive.com/index.php/2017/08/07/kachikwu-nigeria-lost-60bn-to-non-enforcement-of-pscs-with-oil-majors.  Nigeria can add over N2 trillion to its budget by the proper governance, supervision and risk management of its oil and gas sector. This can take immediate effect – if uncompromised leaders see to it. The original PIB was focused on increasing signature bonuses, royalties, and other advantages due to the Nigerian people. We must find it, mainstream it, get it signed and put into effect by every means. And urgently too.