40th Anniversary Celebrations Of The Association Of Friends Club
HOW WE ARE ADDRESSING EXTREME POVERTY, CREATING BETTER OPPORTUNITIES FOR NIGERIANS, BY VP OSINBAJO
“Oil revenues cannot solve the enormous problems we have. Productivity, creativity is the key; that is why many countries that don’t have natural resources are productive and wealthier than countries that have oil resources such as ours. The key is productivity.
REMARKS BY HIS EXCELLENCY, PROF. YEMI OSINBAJO, SAN, GCON, VICE PRESIDENT OF THE FEDERAL REPUBLIC OF NIGERIA, AT THE 40TH ANNIVERSARY CELEBRATIONS OF THE ASSOCIATION OF FRIENDS CLUB, ON MONDAY, 12TH NOVEMBER, 2018
I am deeply honoured to have been invited to speak at this start off of the 40th-anniversary celebrations of this great club, the Association of Friends. I have a lot of “egbons” who are members of this club, but in particular, I am here at the express command of my uncle, Otunba Festus Adeleke Adesina, pioneer president of the club.
This club is a great gathering of some of the best minds in Yoruba land and indeed, this nation. The club recognizes that it is the duty of the elite in any society, to think for the society, to plan for the development of the society and to set the standards of integrity, morality and high values for the society.
I commend the Asso club for the excellent manner in which it has discharged its responsibilities to our race and nation. I want to say specifically, that every elite club such as yours, has an important duty, and that duty does not end at any point in time. As a matter of fact, that duty is handed down from one generation to the other.
Watching the documentary earlier makes it obvious that the Asso club has a plan, to hand over illustrious legacies and values to forthcoming generations. I commend you again, for thinking through these issues and for ensuring that the issues that concern our society, remain at the front burner of your thinking.
The next two decades will be decisive for Nigeria. We would either become the pre-eminent nation in Africa and one of the world’s leading economies, or we could be one of the greatest socio-economic disasters in history, if we are not careful. Why? With our population growing at almost 3% a year, we will by 2050, become the world’s third most populous country. Almost 70% of that number will be young people under the age of 25. There will be implications of that for education, healthcare and jobs.
Secondly, with climate change leading to desertification at a frightening rate, fertile land is shrinking and the struggle for pasture and water is getting more desperate and deadly.
Today we talk about farmers/herders clashes, especially in the North-central region, this is essentially a struggle for pasture and water and it is becoming increasingly desperate because of the desertification. Lake Chad, which used to be over 35,000square meters in the 1960s, is now 1,350 square meters. It has shrunk and shrinking everyday. It used to be a place where so many communities got their resources. They were able to feed their cattle and animals; they used the water for irrigation and the fish in the water for feeding.
Today, all those communities around the Lake Chad, are in desperate need of resources, and this continues with climate change.
Thirdly, there is rise in terrorism and terrorists’ activities especially along our Northern borders. When I speak of our Northern borders, it is between Nigeria and other countries in the sub-region in the northern part of the country, especially with the emergence of ISIS West Africa, giving rise to dislocation of whole communities in the sub-region, many of them coming into Nigeria. Our peculiar problem is the infiltration of many of the terrorists who came out of ISIS who are now functioning out of West Africa.
Even worse is Libya, after the collapse of Gaddafi and his government; there is release of huge amounts of sophisticated weapons which arms terrorism across Africa.
The fourth is the problem of mass poverty. Let me give you some figures, according to the National Bureau of Statistics, the number of extremely poor people (those who find it difficult to find food, shelter and clothing) are:
So, in 1996, there were an estimated 67.1million Nigerians living in absolute poverty. In 2004, the number moved up to 68.7million. By 2010, a most shocking thing had happened, that number had almost doubled, to 112.47million. What happened between 2004 and 2010? What is astonishing about the poverty situation is that it persisted even when the nation earned its highest revenues.
Let me give you the figures from our oil earnings:
2010-2014….$381billion, more money than we had earned before within a short period.
2015…2017 Dec $94billion
Up until the first quarter of 2018, we have earned$112billion.
Now take the period between 2010 and 2015, for most of that period, Nigeria enjoyed an oil boom, with oil prices hovering around $100 $-114per barrel on the average. This is the period when we have earned the highest amount from oil in any four-year period. Our external reserves fell to 30 billion by the end of 2014. The number of out-of-school children as of 2015 was 10.3 million. And in that period we piled up the highest debt in our nation’s history.
Let me give you the figures of the total debts, local and foreign, for Federal Government and the States debt from 2010 to date:
2015…….$63,806.53 – total debt of federal, state and local governments
What do these figures show? They show that when oil prices were at the highest between 2010 and 2014, the government was borrowing heavily from 2010 to 2014, debts moved from $35 billion to $63 billion. When we assumed office in 2015, the debt that the previous government left was $63 billon. Today three and half years later, the debt is $73 billion.
Two reasons why despite high earnings we are poorer, and I am glad that I am here with the intellectual crème de la crème of our nation and we should be able to tell ourselves what is wrong, the first reason why despite high earnings, we are poorer is because of grand corruption and mismanagement of resources.
I will explain; grand corruption is direct stealing from the Central Bank, the treasury, without any contract and the money is spent and shared. Every time I talk about it, you hear the opposition shouting and yelling but that was what was going on. In one day, $292 million was signed out and disappeared. After that incident, for two weeks, the Central Bank did not have cash dollars. We later discovered what became of the money. Another N60 billion was moved out ostensibly for security purposes, but we know what also happened to the money.
It is possible that where you have a corrupt government, large sums of money, which can be used for development, is simply taken away, it is a different type of corruption from corruption that is related to contracts.
Today, our TraderMoni scheme (which gives traders a loan of N10000, when that is paid back, they get N15, 000, when that is paid back, they get N20, 000) is costing us N20 billion. But somebody withdrew $292 million, almost N70 billion. If you have N70 billion, you’d solve the problems of 7 million of those petty traders. Those are the sorts of contrasts we are trying to draw.
Did you ever hear anyone criticize the withdrawal of $292 million? But today, someone is saying it is political to give petty traders money, the bottom of the pyramid.
The second reason why despite high oil figures there is still poverty is that the exploitation of natural resources and sharing of the revenues is a failed approach. The oil industry by itself does not promote a good number of jobs; it produces very few jobs.
Oil revenues cannot solve the enormous problems we have. Productivity, creativity is the key; that is why many countries that don’t have natural resources are productive and wealthier than countries that have oil resources such as ours. The key is productivity.
Each state must be productive, generating revenues from agriculture, manufacturing, and the knowledge economy. And we must empower the bottom of the pyramid; the poorly resourced petty traders, because they are the largest working population that we have, those informal traders who are all over Nigeria. And nobody gives them credit or facilities because banks fear that they won’t be able to pay back. So, government must, as a matter of policy, ensure that they have access to credit so that they can do better in their businesses. These are they so-called maishai, maisuya etc.
How do we achieve this? How do we achieve a situation, where we are more productive, whether we have oil resources, or not, we are able to make the kind of money that benefits our people and they can be taxed and can develop roads and infrastructure and we can assure a future for our population? It is by restructuring. I have argued elsewhere that the commonly held notion of restructuring, meaning geographical restructuring, will not achieve much. By that, I mean that the suggestion that we should go back to the old regions or create more states will not solve the problem.
Most of the states won’t even agree to go back to the old regions or arrangements, fancy trying to get Ekiti and Ondo to merge, or Oyo and Osun states? Nobody would agree to that. Assuming we formed a region and got everyone to work together, the region would have its own governor, so you’d probably have a Governor-general, and then we would have a legislature, adding more to the burden of government.
Our problem isn’t in having more functionaries, one extra government, another house of assembly and judiciary, that’s is not our problem. In fact, one of our current problems is that the cost of government is too high, too many people in public positions being paid large sums of money.
In the National Conference held in 2014, one of the conclusions made, is the need for 18 more states. Can you imagine a situation where we have 18 more states to what we have at the moment?
When we got into office in 2015, 23 states had not paid salaries; they owed between 3months to 11months salaries. You then add 18 more states to the current number of states! You then have 18 more governors, more legislatures, more judiciaries, how does that solve our problems? As a matter of fact, it adds to the problem.
What we need is the restructuring that gives us stronger states. Stronger states within a Federation can, with the critical mass of resources they aggregate, solve the four problems I had highlighted above.
What does concept of a strong state mean? It means two things. The first is what states must do for themselves. By that I mean the three arms of government especially the Executive and the Legislature working proactively and creatively as independent administrative and wealth producing economic entities. Each state must be challenged to leverage on its strengths to generate revenues for development.
The second is the devolution of more power to the states, enabling the states to control more of their resources and make more of their own administrative decisions such as creation of Local Governments; the state and community police, including the state prisons; creation of special courts and tribunals of equivalent jurisdiction to high courts. The point I am making is that states must have more powers and more rights.
An example is the phenomenal achievements of the Western Regional Government of Chief Obafemi Awolowo in six years, illustrating how the convergence of the two imperatives I have mentioned earlier (what the states can do for themselves and greater power to the states) can be used to transform the socio-economic destinies of millions.
He was Premier of the Western Region of Nigeria from 1954 to 1960. The Western region is what today constitutes Oyo, Ogun, Ondo, Ekiti, Osun, parts of Kwara and Kogi, Edo and Delta, Lagos( as far as Jibowu/ Ikeja, Agege).
The six-year period of the Awolowo government is often cited as one of the most progressive of any government in the developing world. Some of the major accomplishments include a major agricultural revolution, government supporting and subsidizing cash crop production, using commodity exchanges to enhance agri-business, several farm settlements, several agro-allied and other industries including Oodua Textile Industries, Ado Ekiti Okitipupa Oil Palm Mills, Oluwa Glass Ifon Ceramics, and Ire Ekiti Brick Industry, as well as several industrial estates and parks, including the Ikeja industrial estate.
More accomplishments include a network of roads across the region, the University of Ife (now Obafemi Awolowo University), the 26 Storey Cocoa House, Ibadan, Airport Hotel, Ikeja, Western Nigeria Television Authority (first of its kind in Africa, even ahead of many European countries including Belgium and certainly ahead of South Africa).
But by far, the most significant of these achievements is the Free Universal Primary Education. In 1952, when the scheme was proposed, 381,000 children were enrolled in school. By 1955, when the scheme took off, 811,432 children were enrolled and the numbers continued to grow.
The government devoted as much as 41.2% of the 1958/59 recurrent budgets to education at that time, one of the highest in the world. At the same time, the region nurtured a vibrant civil service and judicial system, which is widely acknowledged as a model, even today.
So, how were Awo’s phenomenal achievements possible? There was no oil revenue and no Federal revenue. In fact, the Western region gave revenue to the Federal government. How did they do it? Mostly from taxes and revenues from agriculture, especially cocoa.
Free education, which was audaciously launched by the Awolowo government, was directly on the back of income taxes. The Western region government, mainly to fund free education, despite much opposition and protests, imposed a capitation or poll tax. For those who follow his political history, Awolowo of course, lost elections in the West on account of his insistence on free education. That kind of political courage is always difficult to find these days but that is the cost of leadership.
If you look at what was achieved at that time, and this is the point being made; the states as presently constituted today, same landmass, now with better-educated people, with more infrastructure, with more people working, do not generate enough taxes to even pay for education or pay salaries.
When we talk about restructuring, we must ask ourselves, what type of restructuring? The type of restructuring we need is one that enables us to develop our own states, the same way the Western; Eastern and Northern regions developed their territories without oil revenues.
Today, everybody depends on oil revenues. Every month, the state governors gather in Abuja and the Federal allocation is shared.
But the truth is that a combination of visionary leadership and strong autonomous states is the winning formula for economic development, and that is really as simple as it is.
Awolowo was also a visionary leader but he also had an autonomous region behind him. Today most States of Nigeria do not generate enough IGR in one year to pay salaries for a month. Lagos State earns more in IGR than 31 states put together. And talking about payment of taxes, our tax to GDP is still under 10%. Now it is closer to 8% now, it used to be 6%. From FIRS statistics, only 914 Nigerians pay self-assessed tax of over N10million. Of that 914, 912 are in Lagos, the other 2 are in Ogun state.
If you have that kind of tax deficiency, we all know that there are 100,000s of people who should be paying more than N10million in taxes per year.
But the process of creating stronger sub-nationals is possible even without making any major constitutional changes. We have said that we need to do two things; one is to ensure autonomous strong states, also we have said that we must devolve power to those states and also ensure that at state level, the states themselves must be productive, and generate income.
In the period from the civilian government from 1999, I was privileged to serve in the government of Ashiwaju Bola Tinubu, in which I worked as Attorney-general of Lagos state. I worked closely with the State House of Assembly, challenged the Federal Government and the National Assembly before the Supreme Court in several cases, designed to deepen the independence and the autonomy of states. In the period of 1999 – 2007, and even beyond that, what Lagos achieved was a restructuring by litigation.
The Supreme Court established the following principles in the cases:
The first is that states could by law of the State House of Assembly, create their own local governments. However, after the creation by law the state would have to go a step further by submitting returns to the National Assembly, which in turn would list the new local government areas to be in the Constitution.
It is because the state can create its own local governments that the Lagos state government at the time took the position that it could hold elections into the LCDAs that it created without any other law. But in consultation again with the State House of Assembly we agreed to create a special which is an LCDA law to empower the LCDAs not only to function administratively but to be capable of rendering the sort of services that local governments render.
The important point to be made is that after the Supreme Court had said that we had the right to create local governments we have not backtracked on that since then and even up till today, state governments have maintained that position.
The important point to be made is that after the Supreme Court had said that the state government can create local governments, we have not backtracked on that, and even up until today, state governments have maintained that position.
Just to reiterate the point, we went to the Supreme Court after we created 37 new local governments. The Federal Government agreed under (former) President Obasanjo that we had no right to create local governments, and President Obasanjo at the time stopped allocation to the state because we had created 37 local governments. We challenged him at the Supreme Court, and the Supreme Court agreed with us that we had every right to create local governments, but that after we have created local governments, our local governments had to be listed at the National Assembly. But, that by law, every state had the right to create local government. When the Supreme Court returned its verdict, we then, by law, created the LCDAs, just like we have today, and allowed the LCDAs to essentially perform its functions like local governments.
The second point, which we asserted at the Supreme Court, is that the Constitution intends that everything relating to local governments must be in the province of the State Government rather than in that of the Federal Government. The National Assembly has no power, under any provision of the Constitution, to increase or alter the tenure of the elected officers of the Local Government Councils. Only the House of Assembly of a state has such a power.
In other words, we said that if we want our local governments to have five-year terms, rather than three-year term, you can, by State law, do so. Federal Government cannot alter the tenure of Local Government or chairmen. We went to the Supreme Court and the Supreme Court agreed with us, that we had every right to determine the tenure of our local government chairmen. This is establishing the autonomy of the state, establishing the power of the state to at least control their own resources and control their administrative units.
The third point is that a state has exclusive legislative and executive authority over urban and regional planning functions. Even with respect to federal lands in states, the Federal Government must seek building or other development control permits from the state. It is to the effect that the state has exclusive authority to make laws on urban and regional planning. Even where federal land is concerned, the Federal Government must seek permission from the state. And I’ll explain that point so that we understand it very clearly.
Say this is Federal land, we can issue our permits for federal land. So even if they like, they should go and take the whole of Ikoyi, Victoria Island, let us issue permit, we took them to court and said, no. It is the state government that has the power to give construction permits, even over federal lands. So, we went to the Supreme Court to say that even when the Federal Government owns a piece of land, they cannot build on it unless the state government gives them permission to do so. And the Supreme Court agree with us. So, today, the law is that even over federal lands, it is only the state government that could give authority. So we deepened the autonomous power of the state to remain autonomous, even over the Federal Government in specific situations.
The fourth point is that the President of Nigeria has no power, however good his reasons may be, to seize or withhold the statutory allocation of a state or local government. No matter how good his reasons may be, the President cannot say that, “because I suspect that you people are going to waste the money, or you are stealing the money, I’m not going to give you your allocation.” He has no right to do so. The Federal Government of Nigeria stopped our own allocation when we created local governments, and we took them court, we went to the Supreme Court and said, no. The autonomy of the states guarantee that we are sharers, all of us – state, local governments – to come to the table with the Federal Government to share federal allocation. The Federal Government is not a father than can decide, “hey boys, I don’t like what you’re doing, I’ll hold your pocket money until next term.” We took the (former) president to court and challenged him, and the Supreme Court held that, indeed the Federal Government or the President had no such power whatsoever to withhold our allocation. Although we didn’t get that allocation back till the next office, but at least we firmly established the principle, and that principle endures until today.
Permit me to consider the next ruling of the Supreme Court in some detail just to demonstrate the extensive powers of State legislatures, especially over the supervision of statutory allocations. There was a case also that we took to the Supreme Court; it had to do with the monitoring of revenue allocated to Local Government Councils from the federation account.
In May 2005, the National Assembly passed a law titled the Monitoring of Revenue Allocation to Local Government Act 2005. The law established a monitoring committee for funds allocated to local governments and required each State to give an account of how it expended local government allocations to the Accountant General of the Federation. Lagos State challenged the law in court.
In the lead judgment of the Supreme Court, Honourable Justice Niki Tobi of blessed memory took time to explain the practical implications of the principle of federalism in our Constitution. And he said, “Federalism as a viable concept of organizing a pluralistic society, such as Nigeria, for governance, does not encourage so much concentration of power at the centre.” Each of the federating units must be independent and coordinate. Each of them exists, not as an appendage of the other, but as an autonomous entity in the sense of being able to exercise its own will in the conduct of its affairs, free from direction of another government.
Then his Lordship contrasted that with Unitarism. He said unitarism is an arrangement where the Constitution “concentrates power at the central or national level a very strong central command, making the regions or groups parasitic on the centre, in the sense that they do not enjoy any autonomy.”
The way the Supreme Court decided this is so important, because some people today who are talking of this topic do not understand the extent to which we have gone in the process. They do not even know where we are now. They just talk about it. They don’t even know what has taken place. The Supreme Court has clearly spoken about the extent of the powers of autonomy or the autonomous rights of states. The Supreme Court has already told them that we are not in a unitary state. As much as possible, we should be capable of functioning as independent and autonomous units.
We must understand where we are today so that this argument of restructuring takes on a much more intelligent process. In any event, restructuring is an evolutionary process, you cannot restructure in a whole day. We move from regions to 12 states, we restructured to 19, now we are 36. We are now talking of deepening the autonomy of states. We must understand where we are.
The Lagos State legislature has in this tradition of establishing and pushing the frontiers of federalism by legislation and litigation where necessary has done a lot and has made many strides.
In more recent times, Lagos State government passed something called the Hotel Occupancy and Restaurant Consumption Tax Law. In that law, Lagos State asserted its autonomy by saying that “we are in control of entertainment in our state”, hotels and restaurants are under our control. They imposed a 5% tax on sales in hotels and restaurants, which was passed by this House. The Federal Government challenged it, the federal government went to Court and said Lagos State government had no right as a state to pass a law. But the Supreme Court declared the law valid because matters of hotel and consumption tax generally are state affairs. So, the Lagos State government, by passing that law, clearly shows that the state has a right to manage its hotels and collect consumption and hotel tax.
Also, Lagos State, in 2006, passed the Lagos State Internal Revenue Administration Law, the LIRS law, for the first time. Aside from several structural changes brought about by the law, it granted the LIRS autonomy from the civil service such that its remuneration and disciplinary processes were more business-like.
One of the very important things that LIRS achieved, because all of that was passed when our (Lagos State) resources, money was seized by the Federal Government. When the money was seized, we realized that we either swim or sink. We had to find a way. So, we reformed our tax system ourselves. We had to think it through it, we couldn’t have a tax system that was just wasting resources, we couldn’t have a tax system that was corrupt. We had to reform our tax system. We passed a law, based on autonomy, giving those who are collecting taxes bonuses so that they would collect taxes more effectively. We reformed the entire process, and we saw the difference.
When we got into office in 1999, (monthly) IGR in Lagos was N600million for almost two years. Today, it’s in the order of about N33billion, this same state. The difference, first of all, is in realizing that your destiny is in your own hands. That’s the difference. That’s what made Awo (Obafemi Awolowo) different; that was why Awo was able to do the thing he did in the Western region, because he took the destiny of the Western region in his own hands. The people of the state and the elite decided, “we’re going to go forward and we are going to do the right thing,” and that made the difference.
The Lagos State government, also through its House of Assembly, passed the Lagos State Waterways Authority Act. In passing that Waterways Authority Act, it modified the National Inland Waterways Authority Act of 2004. The law established the Lagos State Waterways Authority and saddled the agency inter alia with the regulation and management of the internal waterways of Lagos State. And that is a very important legislation also. It is also one of those assertive positions that Lagos State government has taken. In fact, the Lagos State government decided that, “we are going to manage our own internal waterways.” To support, there was already a national inland waterways act, which is an Act of the Federal Government. But Lagos State said, “no, our internal waterways should be our concern.” Federal Government can regulate the internal waterways, they are supposed to regulate waterways between states, from one state to the other, but internally, we (Lagos) must regulate our lagoons. So, a law was passed. When that law was passed, the Federal Government challenged it.
The High Court upheld the position of the Federal Government, but the Court of Appeal has since reversed it and has upheld the position that the Lagos State Government has every right to pass a law to regulate its internal waterways. So, as of today, that law stands.
And this is the way by which very seriously and very progressively, the Lagos State government has achieved, not just for itself, by the way. Every one of the decisions that the Lagos State government has obtained from the Supreme Court applies to all states of the Federation. So, it’s not just Lagos State making the progress by ensuring that we put our resources where our mouth is, we have been able to do more for autonomy of states and restructuring than some who would just talk about it. Because at the same time, when we were pushing all these, there was a government in place between 1999 and 2007, and there were some gentlemen who were in that government who today are talking about restructuring, but were opposing us every step of the way then. I know you know some of those gentlemen.
On the security question, we must establish State Police, there is no question about that. No matter how we slice it, we cannot run away from state police. Today, the challenges that we are facing across the nation, especially many of security challenges, are challenges that can be addressed by the states.
Sometimes at 2am, 3am, I get a call from another state that there was this attack on their way, there is this happening and all of that. It is the federal police that you have to deploy to these men, to farthest portions of this country. That can’t work. You cannot have a Federation of 200 million people and the states would not control their own police. There must be state police, but that does not mean there won’t be federal police. The federal police would remain, especially for inter-border crimes, for things like elections, smuggling, and all of those kinds of things. But you must still have states who police themselves.
Today, many of the state governments pay for police operations any way. Lagos state police has its security trust fund. That just shows you that whether we like it or not, it is the states that are paying for most of the operations of the police.
So we must have community police, we must have state police. We must also have state prisons as well. You cannot say that a governor is the chief security officer of a state, when he has no control of the security in the state.
We require a constitutional amendment and there is already legislature at the National Assembly, these are the very important issues that need to be dealt with.
Restructuring is also very important on the issue of the eradication of poverty. There is no question that poverty remains one of the most critical contemporary challenges of our nation. It is both a cause and effect of the conditions of squalor, disease and misery that millions of our people live in. The good news is that it can be solved and eradicated.
Three issues are critical to resolving the poverty problem. The first is education, second is healthcare, and the third is the provision of jobs.
Education, especially relevant education, is the surest pathway out of poverty. The immediate challenge is to resolve some of the crisis in that sector. The outrageous number of out of school children, about 10 million, and these include, to quote Prof Iman, “the children of the pastoralist communities who are spread across the country, the Almajiri and girl-child, found predominantly in the North, the out of school boys in the South-west and South-east as well as children of migrant fishermen in the South-south. In addition, there is the growing number of migrant farmer children in parts of Ebonyi, Ekiti and Ondo states and more recently, children displaced by the Boko Haram insurgency in the North-east”.
There is also the problem of poorly trained and poorly remunerated teachers, and low investment in education, at both National and sub-national levels. There is a crucial need to address the issues by a mass youth and adult literacy programme leveraging radio and electronic and mobile platforms – comprehensive educational curriculum including Science, Technology, Engineering and Mathematics (STEM), and Technical, Vocational Education and Training (TVET) and Teacher Education, Capacity Building and Professional Development, these are issues that must be addressed.
At the last meeting of the National Economic Council; a council involving all of the state governments, we had a full discussion of this issue of education and how to deal with the educational challenge. One of the major problems we have is how to ensure that our adult population, that is even illiterate, is also made literate. And how to ensure that our growing youth population that is illiterate, is somehow, made literate. There is no way we can do it without technology. It is clear that we need to use technology and all the mobile and electronic platforms and some of those experiments going on. I know that at the Ministry of Education, there is a lot going on regarding using radios and mobile platforms for mass education.
There is a need to focus, spend time and put resources behind education, not just at the Federal level but in particular, at the State level. This is because the States have primarily, the duty to ensure that primary and secondary education is funded. It is within the province of the State government, Federal Government does not own primary and secondary schools, except the unity schools.
Most of the problems we have are solvable, but perhaps it is important for us to talk about the public health challenges that we have. The good news is that most of the problems in our healthcare system are also solvable. It is better funding and more deliberately targeted preventive healthcare.
Take two significant diseases, Malaria and Aids. Malaria is one of the most important public health problems in the world. As of 2014, Nigeria accounted for nearly 29% of the global malaria deaths. Malaria is responsible for approximately 60% of outpatient visits to our hospitals, and 30% of admissions.
It is also believed to contribute up to 11% of maternal mortality, 25% of infant mortality, and 30% of under 5 mortality. It is estimated that about 110 million clinically diagnosed cases of malaria and nearly 300,000 malaria-related childhood deaths, occur each year.
The disease overburdens the already-weakened health system, and exerts severe social and economic burden on the nation, retarding the Gross Domestic Product (GDP) by 40% annually and costing approximately N480billion in out-of-pocket treatments, prevention costs, and loss of man-hours (FMoH and National Malaria Elimination Programme [NMEP] 2014).
Nigeria has the second largest HIV epidemic in the world, although HIV prevalence among adults is much less (2.9%) than other sub-Saharan African countries, such as South Africa (18.9%) and Zambia (12.4%), in absolute numbers, because we have more people, Nigeria has more people with HIV, there is more prevalence in absolute numbers, but actual occurrence is much lower than other parts of Africa. So, the eradication of malaria and the prevention and containment of AIDs, will be major economic milestones.
The issue is that we must increase the aggregate National health expenditure. In 2017, the health budget of the 36 states was a little above N332.1billion, which was about 4.9% of total budget size. This year, only Bauchi has met the 15% target of the “Abuja Conference” target, where African Union countries pledged to set a target of allocating at least 15% of their annual budget to improve the health sector.
States must ramp up their spend, this year for the first time, with the active collaboration of the National Assembly, we met the 1% of our National budget prescribed by the Health Act for health care cost.
But perhaps more importantly, it is time for compulsory health insurance. The huge out of pocket expenses for malaria treatment make it clear that we need health insurance. Every State can have its own; this is an important conversation for the executive and legislature to have, in setting a legislative agenda. There is no question at all, that we must spend more on healthcare just as we must spend more on education.
So how do we deal with the job creation issue? One of the important problems we have is creating jobs for young people. Just as I said earlier, we are growing at a rate of 3% every year. We will be the 3rd most populous country in the world, after China and India in 2050.
As I mentioned earlier, our party, the APC, in drafting the manifesto, many arguments came up in dealing with job creation. We realized that we simply had to adopt a bottom-up economic model. One where the government directly intervenes in by a massive social investment programme.
This sort of programme addresses youth especially graduate employment and credit to small businesses but especially credit to the smallest businesses, the one table trader, the bread or plantain seller or the MaShai.
Let me explain quickly; when you look at the way our budgets are framed, they are done in a way that addresses only the elites in the society, we look at what to do for industries, manufacturing, those in the high levels. But we have a very large number of people who are in informal trading; the traders and market women. A lot of these people are not usually addressed in our budgets and they are the vast majority of our people.
The second point is that even with respect to manufacturing, industries and all that, we do not take a job creation approach, in other words, we are not supporting those industries that create jobs. It is important that we support the industries that create the most jobs, we must put money in agriculture, and we must invest in the knowledge economy, technology and others. We must fund those industries that produce the highest number of jobs, and also give credit.
One of the ways is the Federal Government ensured through its Government Enterprise and Entrepreneurship Programme, it started giving micro-credit, something called MarketMoni, between N50,000 – N350,000 to market women and artisans. We have given to about 400,000 and we are looking at giving to a million people.
We then started TraderMoni which is giving to the bottom of the pyramid money to add to their inventory, their inventory is no more than N3000 – N5,000. They are an important part of the value chain of most goods, they sell the single sachets of soap, sugar, and spices to the largest numbers of our people. But they are forgotten and ignored in economic plans and budgets, and considered too unwieldy and risky for micro credit loans. We decided that we must supplement what they have so that they can buy more and do more.
We looked at several other models like India, Brazil, of putting money in the hands of traders and ensuring that they are empowered. They get N10,000, and when they return it, they get N15,000, and after they return that, they get N20,000. We have seen that the return rate is high.
Some arguments have been raised by the Nigerian elite, that it is a waste of money, why should government give people N10,000. In 2009 – 2011, about 300 Nigerians owned the 5 major banks and the banks were about to collapse. The Federal Government then bailed out the individuals and banks, they spent N5.7trillion. Today, our budget is N8.3trillion, just to understand what we are talking about.
We have not spent N500billion on the entire social investment programmes, but we bailed out 300 of the Nigerian elite. That is the kind of distortion that makes it difficult for us to do well. We have to understand what we are dealing with; if we put N1trillion behind a social investment programme, put money and resources in the hands of traders, farmers, carpenters, and train them; also we have employed 500,000 graduates in our N-Power programme and we still haven’t spent N60billion. If we employ 500,000 more graduates, to make a million, we would still spend under N500billion.
We need to understand that we cannot allow people to steal our money, and secondly using the resources to support traders and artisans.
One of the ways by which we are empowering traders is by the energizing economies, putting powers in markets and economic clusters. We have put power in Sabon Gari market in Kano, Ariaria in Abia, Isikeun in Ondo state and recently, Sura market in Lagos. These are power projects that enable those markets to have power 24/7, they are more productive and pay more taxes. They pay for the power and happy to do so because it is cheaper than generators.
By supporting small businesses and providing micro-credit, we are able to do more and create a situation where even the states benefit more and they are able to put their resources to good use.
Just to say again, I am very grateful for the opportunity to come hear and speak to you.
“Each state must be productive, generating revenues from agriculture, manufacturing, and the knowledge economy. And we must empower the bottom of the pyramid; the poorly resourced petty traders, because they are the largest working population that we have.”