THE NIGERIAN FRONT: An Unaffordable Deficit – By Dr. Olu OdejokunArticles, Columnists, NNP Columnists, Olu Ojedokun, PhD Tuesday, June 7th, 2011
By Dr. Olu Odejokun, Loindon, UK – June 7, 2011 - We of The Nigerian Front are gravely concerned about the state of our nation stemming from the current prognosis of the recently signed budget. The budget indicates that greed continues to dominate the polity as our resources are being mismanaged. If care is not taken the consequences would be devastating for generations to come. While we do not wish to become prophets of doom and gloom it is surely our role to challenge the government to keep it honest in order to avoid economic disaster.
We will, in the ensuing paragraphs, provide a proper context to the seriousness of the Nigerian situation by quoting from an elder statesman of blessed memory. A man who spoke truth to power in an era different from ours and echoed words that we restate today because we are left with little choice: We now believe there is a frightful danger ahead visible for those who care and are patriotic enough to look beyond their narrow self-interest. The ship of state is fast approaching a huge rock, and unless the President as the chief helmsman quickly rises to the occasion and courageously steers the ship away from its present course, it shall hit the rock and the inescapable consequence will be an unspeakable disaster of monumental proportions.
We have begun this particular article with a great alarm only because the situation demands it. The recent reports confirm that the President, Goodluck Jonathan has signed into law a budget with a trillion naira deficit. The budget for the 2011 fiscal year reveals a total expenditure of N4.485 trillion ($29.2 billion) with a deficit of N1.136 trillion based on the benchmark oil price of $75/bbl.
The great concern is how the nation continues to run a budget with such huge deficits caused by the unsustainable pace at which the recurrent expenditure continues to grow. This is illustrated by fact that the 469 incoming lawmakers will earn N338.6 billion in the next four years, adding almost N85 billion to the deficit every year.
Further detail reveals that only N18.245 billion of this expenditure is the actual budgeted salary for the legislature over their 4-year tenure. The rest of the jumbo pay comes in the form of the quarterly allowances the two chambers of the legislature approved for themselves last year. When providing justification for its approval they described it as: “running cost/quarterly allowance.”
The breakdown of the allowance which comes down to N42 million and N45 million each for a Representative and Senator respectively would see the members of the House of Representatives earning an additional N168 million every year, a figure that translates to N672 million for the four years such a lawmaker would stay in office while for the Senate, it comes to N720 million per Senator.
It is instructive to note but for the inflated allowances of the legislators what should be reflected on their pay slips should be their statutory salary of N18.245 billion, the total expenditure for the two chambers in over four years. Of this amount, N4, 881, 394, 960 will be spent on the 109 Senators while the remaining N13, 364, 450, 550 will be spent on the maintenance of the 360 members of the House of Representatives.
In line with the remuneration package for political, public and judicial office holders approved by the Revenue Mobilization Allocation and Fiscal Commission (RMAFC) from July 2009, a Senator earns an annual emolument of N8, 206, 920 while a member of the House of Representatives takes home N6, 352, 680 per annum. The cumulative emolument of a Senator for the four-year term will, therefore, come to N32, 827, 680. In addition, each of the 109 Senators is expected to take home another N11, 145, 200 in allowances described by the RMAFC as non-regular, and are collected one off as the case may be, at the beginning of the tenure.
The legislators seem to have no reverse gear as far as spending is concerned, they are oblivious to the global trends and are steaming ahead on full speed with the legitimization of the public looting described as so-called allowances. Whilst many in the developed world are prioritising and making conscious attempts to live within their means we seem to see profligacy as a virtue.
This is demonstrated by the budgeted recurrent expenditure of N2.425 trillion and capital N1.147 trillion. We spend more on salaries, pensions and allowances than on developing our nation and much of it is money we simply do not have. It is clear that we are living beyond our means and the profligacy must stop. We believe the priority of all organs of government must be to address this and the recently signed budget must be reviewed with a supplementary version provided to the newly convened National Assembly, which should engage with certain key questions:
· What institutions need to be optimised and what budgetary expenditure needs to be curtailed or removed?
· What represents genuine investment as opposed to recurrent expenditure?
· The role of the Federal Executive Council (the cabinet) in expending its time and functions on adjudicating upon every detailed contract of government expenditure needs a review.
· How do we prioritise capital expenditure investment infrastructural maintenance over recurrent expenditure?
· How do we prioritise the governmental agencies from the customs to the immigrations in attracting inward foreign investments?
· How do we return to a balanced budget, where we only spend what we generate?
· A roadmap to return us to a sustainable policy, which allows us to save for the future when revenue diminishes.
We also appreciate the task of restoring financial sanity to our budget making process does not belong to the executive alone. The National Assembly and in particular the opposition has a role to play. The CPC can live up to its claim of being incorruptible and different from the PDP and the rest by calling upon its own legislators to reject all the unaffordable amounts of money dressed up as allowances and specifying where such savings gained from their noble actions might be invested in.
Above all, the long suffering citizens of Nigeria should identify their own legislator and petition them to reject such unnecessary allowances, demonstrating we are all in this together.
Dr. Olu Ojedokun writes on behalf of The Nigerian Front .
Signed by the following Representatives of The Nigerian Front:
Mr. Remi Jibowu, Dr. Onochie Okoye, Alh Ismaila Zakari, Prince Asuquo Ibok, Mr. Bashar Dankaro, Mr. Derrick Kentebe and Dr. Olu Ojedokun
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