Get Guardian on GoogleFor a country that has struggled to reconcile rapidly rising expenditure with slow-growing revenue, Seyi Makinde’s 2027 blueprint under The Reset Agenda appears to offer an alternative to present economic discourse, ISAAC CHIBUIFE reports.
Nigeria’s fiscal crisis has reached a point where the sustainability of governance itself is becoming a serious economic concern. With debt servicing consuming an overwhelming proportion of public revenue, governance is almost sustained by debt. The previous administration went as far as turning the Central Bank of Nigeria’s (CBN) temporary relief into a major source of budget financing.
It is against this background that the presidential candidate of the Allied Peoples’ Movement (APM), Seyi Makinde, presented what he described as an alternative economic direction for Nigeria ahead of the 2027 general election.
In his 74-page policy document, The Reset Agenda, Makinde promised to reduce the debt-service-to-revenue ratio, which stood at about 67 per cent as of September last year, to no more than 50 per cent within three years, bring the fiscal deficit within the statutory limit of three per cent of gross domestic product (GDP), end excessive reliance on government-owned refineries and overhaul their management.
Like other politicians who have led the country in recent years, Makinde has set tough targets. For over 10 years, fiscal deficit targets have remained above the three per cent threshold set by the Fiscal Responsibility Act (FRA), while actual deficits have, in most cases, surpassed five per cent. Public refineries had remained largely non-functional for decades despite gulping billions of dollars in turnaround maintenance (TAM), until last year’s revival, which was short-lived.
Makinde proposed ending government funding of facilities that cannot operate reliably. If elected, he said his administration, within six months of taking office, will undertake independent technical, financial and asset assessments of each state-owned refinery, according to the document.
Also, within 12 months, each facility would be assigned one of three options: a competitively selected private operating partner, conversion to another petroleum or logistics use through commercial financing, or orderly decommissioning. Viable transactions, it noted, would be concluded within 18 months, with performance milestones enforced by the end of the third year.
The document proposes a reconfiguration of public borrowing, monetary policy, petroleum revenue management, electricity market regulation, business taxation, infrastructure financing and agricultural production. The proposals are significant because they attempt to address some of the structural weaknesses that have made Nigeria’s economic management inefficient, expensive and less productive.
But questions remain about whether the proposed alternative can deliver the promised fiscal discipline without confronting the political interests that have sustained the prevailing rot in the public sector.
The proposed reduction of the debt-service-to-revenue ratio to 50 per cent within three years is perhaps the most consequential promise in the agenda. A high debt-service-to-revenue ratio speaks to a fundamental weakness inherent in the country’s public finances – its inability to generate sufficient revenue to support expenditure.
Hence, the problem is not just the debt stock but also the relationship between the debt burden and earned income. In effect, Makinde would need to increase revenue significantly, reduce the debt burden or achieve both. Neither option, however, is an easy undertaking.
With continued resistance to tax increases, the government needs more than mere political will to expand revenue. Rising social and economic demands could also complicate efforts to reduce debt-service costs. Still, lower debt-service costs would free up more resources for allocation to critical infrastructure that could serve as catalysts for economic growth.
When debt servicing consumes about two-thirds of revenue, the government has limited room to finance development without additional borrowing. Many economists say the challenge has created a vicious cycle in which borrowing becomes necessary to finance obligations created by previous borrowing. More painfully, current debt tends to increase the future tax burden on citizens.
The document also proposes introducing a Domestic Energy Value Credit (DEVC) to give Nigerians a share of the value generated from crude oil refined and consumed locally.
Under the arrangement, a specified percentage of the budget benchmark crude price would be used to reduce the effective cost of eligible fuel. Where the realised crude price exceeds the benchmark, an agreed share of the additional revenue would increase the credit.
The proposed scheme would operate within defined fiscal limits and would not involve fixing pump prices or introducing an open-ended fuel subsidy. Only independently verified volumes supplied for domestic consumption would qualify, with a digital system deployed to track eligible supplies.
According to him, crude supplied to domestic refineries would also be priced using a published netback formula.
On electricity, the agenda proposes retaining federal control of interstate transmission, wholesale electricity trading and system operations, while allowing qualifying states to regulate distribution and local supply.
Tariff adjustments would be tied to verified electricity supply and metering, with distribution companies required to publish supply hours and outage records by location.
It also promises a protected tariff for the first 50 kilowatt-hours consumed monthly by verified low-income households. Electricity suppliers would be paid only for power actually delivered.
To reduce the cost of doing business, Makinde proposes a ‘Tell Government Once’ system under which businesses would submit verified core information to one federal institution without repeatedly providing the same details to other agencies.
The system would cover 20 high-volume business processes across at least 10 federal institutions in its first year.
The agenda also proposes establishing a public register of all federal taxes, levies, licences, permits, inspections and fees, while prohibiting government agencies from collecting charges that are not legally authorised and published.
Major tax, trade and regulatory changes affecting investments would require published evidence, stakeholder consultation and clear implementation timelines, except in emergencies.
The government would also identify up to five priority value chains, including agro-processing, textiles, pharmaceuticals and construction materials linked to locally sourced minerals.
Existing federal enterprise funds with overlapping mandates would be consolidated into fewer financing windows.
On infrastructure, the agenda promises to identify priority federal freight corridors within six months, based on published technical and economic assessments. It also proposes a Federal-State Road Compact to establish funding responsibilities, reimbursement arrangements and maintenance obligations before construction begins.
For agriculture, rice, maize, cassava, beans and tomatoes have been identified as the first national food value chains, subject to confirmation through current data.
The document says the proposed reforms would be funded mainly by redirecting existing government spending away from duplication, persistent losses and abandoned projects.
Any cost arising from the DEVC would be capped in the annual budget and funded only from petroleum revenue above the budget reference price. The scheme would not rely on Ways and Means financing or additional borrowing.
The agenda promises quarterly progress reports, where data are available, against published baselines. It also says performance would be assessed by actual outcomes rather than funds released, people trained or contracts awarded.
