When the ‘talk’ is hard (I)

Chinyere: The challenges are real and analysts expect further devaluation of the naira exchange between now and the next six months. The exchange rate will be 205naira to one US dollar! It has never been this bad. The Central Bank Governor, Godwin Emefiele, said the factors causing the continued fall in the value of the […]

Chinyere: The challenges are real and analysts expect further devaluation of the naira exchange between now and the next six months. The exchange rate will be 205naira to one US dollar! It has never been this bad. The Central Bank Governor, Godwin Emefiele, said the factors causing the continued fall in the value of the naira are beyond the control of the CBN and the Federal Government. He made it clear that the apex bank could not continue to prop up the nation’s currency from our external reserves so it had to devalue the naira.
Ayo: The government is already struggling to raise money to cushion the impact of the crashing oil price. In the midst of all this, a government report says Arunma Oteh’s Security and Exchange Commission SEC and the Nigerian National Petroleum Company (NNPC), top list of agencies stealing billions of federal revenues.
Isa: It is amazing.  I read about that disturbing report where a federal regulator from the Fiscal Responsibility Commission said billions of naira that should have been paid to state coffers as internally generated revenues were hidden or diverted by government agencies such as the state-run oil company NNPC and capital market regulator, Securities and Exchange Commission (SEC).
Lucy: It is all about shared guilt because the regulatory agencies too, do not to cooperate with each other to combat the violations, effectively helping the defaulting revenue generating agencies to defraud the government for years. The Fiscal Responsibility Commission told Premium Times that the biggest culprit has been the Ministry of Finance which has refused to provide financial details requested by the fiscal commission concerning offices such as the Securities and Exchange Commission. The Fiscal Responsibility Commission said the finance ministry and the Budget Office of the Federation have frustrated efforts to ensure that respective revenue generating agencies remit to government the revenues they generate.
Isa: The forecast is bleak with increase in political activities, politicians are releasing money to win elections, political tension and speculation about violence during elections are all combining to erode the value of the naira.
Chinyere: Declining oil earnings are beyond the government but corruption is at the root of our economic problems. The Ribadu report revealed that the NNPC had failed to report N86.6 billion to the government in 10 years by simple manipulation of exchange rates by officials of the corporation. The report further showed that about 150,000 barrels of crude oil are stolen each day in Nigeria. So Nigeria loses about $13.5 million per day (at $100 per barrel). In a year, that stands at $5 billion (N750 billion)
 Ayo:  We should not forget socio-economic challenges like insurgency and frivolous spending by politicians which all work against naira value.
With such pressure on the currency analysts are predicting a double digit inflation which will undo the stabilized rate in single digits we have had for the first time in more than five years.
Habiba: Am more concerned about our inability to end this insurgency that is ravaging our country, with bombs exploding almost on a daily basis, so many innocent lives are being lost, communities uprooted and the rising number of internally displaced persons IDPs. Without peace, politics and any economic discourse will be meaningless and there can be no development. The insecurity we live with is depressing.
Isa: Corruption is also affecting our ability to squarely address the insurgency and it is time to revisit the pilferage and waste of public resources.
Habiba: Yes. A presidential committee on public service reform discovered that top government officials in Nigeria take home N1.126 trillion a year in salaries and allowances – out of a national budget of N4.9 trillion. These public officers constitute just 0.013 per cent of Nigeria’s population!!!
Lucy: What of our legislators who pay themselves mind boggling salaries? Nigeria’s 108 senators each make over $1.7m a year when US President Barrak Obama only makes $400,000 a year. That alone is $183.4 million (N28 billion). Then the 360 members of the House of Representatives each takes home over $1.2 million, which amounts to $432 million (N65bn).
Habiba: Let’s go to the states where each state governor collects an average of N200 million a month just as security vote. In a year, they each get N2.4 billion. So our 36 governors take home N87 billion on security votes alone every year.
Isa: The next drain pipe are our 38 ministers and ministers of state, 100 plus heads of federal and state agencies, over 432 state commissioners, 774 local government area chairmen or caretakers, almost 10,000 councillors and you will understand where the N1.126 trillion goes.
Ayo: Depressing. In April 2013, the Centre for Social Justice (CSJ) shared with Nigerians its views on making economic and social rights justiciable. We need to discuss and demand that.