Endless borrowing isn’t the solution!

It has become evident that members of the three arms of government are far more concerned about their personal welfare than about the precarious state of the economy. In a nation suffering from galloping inflation, massive unemployment and a decline in the value of its currency, the Legislature and Judiciary are conspiring with the Executive to approve luxuries for themselves. 

Nigeria is blessed with resources but is perpetually broke because political officeholders routinely engage in wasteful expenditure. The Federal Executive Council (FEC) has submitted a supplementary budget of over N2.17 trillion to the National Assembly (NASS) and both the House of Representatives and Senate quickly passed the bill for second reading. In spite of more pressing national problems whose solutions require massive funding, money is being squandered on purchasing luxuries for political officeholders.

Within the proposed supplementary budget, N28 billion has been set aside for State House expenses and enhancements! NASS itself plans to spend N28 billion, which includes N2.9 billion for purchase of SUVs, N6.5 billion on “renovation” of residential quarters, N200 million on “computers”, N4 billion on construction of “office complex” within the State House, N3 billion for “renovation and rehabilitation” of forfeited quarters, and the controversial sum of N1.5 billion for purchase of official vehicles for “Office of the First Lady”. This is controversial not only because the office of the First Lady is unconstitutional, but also because during campaigns the first lady bragged that their family was rich and promised that they would not spend Nigeria’s money on themselves if elected. That unfulfilled promise, along with other unjustifiable anti-people actions, highlights the disconnection between political officeholders and citizens. 

Even as the nation desperately needs responsible financial management, public outrage and negative reactions have not stopped political officeholders from prioritising personal interests over public interest. As the nation’s economy slides inexorably towards disaster, the blame should be placed firmly at the doorstep of the National Assembly (NASS) which approved that all these unnecessary luxury items should be paid for with borrowed money! It’s become obvious that NASS members are insensitive and lamentably apathetic to the plight of the majority of citizens. Despite the urgent need to cut down on government expenditure, especially on creature comforts, they keep silent while both the size and cost of government are increasing. 

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The overwhelmingly negative public reaction to the purchase of a presidential yacht and luxury vehicles for legislators is evidence that public opinion means little or nothing to them. Both the USA and the UK, which Nigeria begs for loans, have long since abandoned presidential and royal yachts as an unnecessary waste of public funds, yet the broke Nigerian government considers it a necessity! Describing it as a “Naval vessel” is disingenuous and insulting to public intelligence. It is easy to google the various types of naval vessels and presidential yacht is not one of them!

Public outrage at the unending borrowing hasn’t prevented the Senate from approving another $7.8 billion and €100 million borrowing plan. In August, NASS approved a loan of $800 million to finance the National Social Safety Network Programme and also approved a Supplementary Appropriations Act for the sum of N819 million for the “provision of palliatives” to cushion the effect of fuel subsidy removal. As a result of what can best be described as a superficial understanding of development economics, the federal government claims they have a revenue shortfall and therefore “need” to increase internally generated revenue (IGR). Lamenting that the nation is broke while engaging in luxuries unconscionably. 

The Budget for 2024 is an unprecedented N26 trillion which will also be financed mainly by borrowing. The problem is that Nigeria is not only broke but also unproductive. In a situation of mass unemployment, and an abominable minimum wage it makes no economic sense to attempt to increase government revenue through taxation. The truth is that the federal government does not have a revenue problem, it has an expenditure problem!

The end result of all this continuous borrowing is the Debt Management Office’s confirmation that the nation’s debt has now risen to N87.38 trillion! The proliferation of controversial expenditures has raised serious questions as to the current administration’s priorities, especially as they have the largest ever number of cabinet members and “special advisers” all draining the public purse. 

The only solution to the nation’s financial crises is to downsize government and channel resources into areas that will create wealth and uplift citizens. Nigerian political officeholders need to change their approach to governance. They cannot continue to preach the need for the endurance of hardship, poverty, insecurity, joblessness and inflation while squandering so much borrowed money on their personal comfort. Borrowing is not much better than begging. While earned money brings security, borrowed money brings slavery as the borrower is the slave of the lender. Responsible parents never leave debts for their children but Nigerian political officeholders have no qualms about leaving debts for future generations to pay.

Borrowing money isn’t a temporary relief; it’s a lifelong subscription to stress! The solution is to properly manage the economy and the nation. If not, then Nigeria is in danger of forever borrowing and being indebted because as the legendary Henry Ford said, it is inevitable that people who can borrow to freely cover errors of mismanagement will forever borrow rather than correct their errors!