We’ve tackled two monsters that impair governance, says Lai Mohammed
• Thanks Nigerians for their patience, understanding
• Re-assures of delivery of change promised by APC
As the assessment of government under President Muhammadu Buhari in the past one year continues to draw mixed reactions, the Minister of Information and Culture, Alhaji Lai Mohammed identified “two major handicaps” that slowed down governance, but which have been effectively tackled “through discipline, commitment and exemplary leadership personified by the President.” In an exclusive interview with The Guardian preparatory to the one year anniversary of the All Progressives Party (APC)-led government, the Minister said, “It will be unfair to start talking about when Nigerians will start feeling that change without really reminding ourselves of what was the situation when we came in,” in response to the question that “after one year, the change promised by the APC has still not manifest.” The Minister spoke elaborately on this issue; painted the graphic picture of the evils of corruption on Nigerians while itemizing the unique features of 2016 Budget designed to turn around lives of Nigerians and many other issues. Kabir Alabi Garba reports.
One year under APC government and the promise of change is yet to be felt by Nigerians?
It will be unfair to start talking about when Nigerians will start feeling that change without really reminding ourselves of what was the situation when we came in. What efforts have we put in to ensure that the situation does not degenerate? It is only then you can now say, oh! In the next few weeks or in the next few months, people will start getting the benefits. But if I now say oh in two or three months time, we will now start seeing the benefits or the dividends of democracy as if we have done nothing so far. Therefore, let us start from the beginning. When you come into government, you are supposed to inherit the assets and liabilities of that government, therefore, no excuse to say we inherited very bad government! We inherited deeper level of corruption and impunity! But what is important is that, yes Nigerians must know what we inherited and more importantly what we have done so far.
We inherited two major handicaps. The first was the massive drop in price of crude oil. The second was the level of corruption and impunity that characterized the last administration. And the two of them are important. Why?
With regards to the first handicap, for almost ten years, Nigeria under the PDP was selling crude at an average of 100 dollars per a barrel and producing almost 2.2 million barrels a day. We came in, the price of crude went down as low as 30 dollars. What that means is that we lost over 60 per cent of our total earnings in the last one year. And it takes a discipline, committed and determined government to manage that kind of shock. So what did we do? We immediately set to work: to put in place measures that will make it impossible… that even the little revenue that is coming in, is not filtered away. That is why TSA was introduced. Also, we introduced a rigorous, transparent system into the payment system, in the process we are able to identify, in the first instance, 23000 ghost workers; another 11000 workers who are now being investigated…. And another 15000 workers in the security areas. It is clear now that we have about 50000 ghost workers in the system. We also introduced efficiency unit, in other words, it is not going to be business as usual. The 2016 budget has been passed now, this efficiency unit will vigorously monitor the way the budget is being implemented. We have also looked at the challenges of what could have been a tragic situation with the massive drop in the price of oil, we took it as a blessing because we are now concentrating on diversification of the economy as the answer rather than mourning on the reduced earnings.
From our 2016 budget, it is clear that we are dedicating 30 per cent of the entire budget for capital project alone. These are roads, railways and power. For people to get a better comparison of what we are doing, in the year 2015, the last administration spent only N18 billion on roads all over Nigeria. This year, we are going to spend N250 billion on roads alone. The major advantage of investing in infrastructure is that it strengthens the non-oil sector of the economy such as Agriculture, Mining, Culture and Tourism. This is because it provides infrastructure such as feeder roads, and acts as a catalyst for the real industry such as manufacturing. And once you provide the enabling environment such as power, roads and railways, then you are building a sustainable economic route.
Another thing we did is in the area of what we call social safety net. This is first time in the history of Nigeria, government will, on its own, think about the interest of the poorest of the poor. This is to be found in our social intervention programmes in the 2016 budget which include: employment of 500 000 graduates; employment of 100000 artisans and technicians; the enterprise scheme of giving revolving loans to one million market men and women, 60000 artisans and 200000 agricultural workers. It also includes one meal a day targeting 5.5 million pupils all over Nigeria. It also includes conditional transfer of N5000 every month to one million must vulnerable Nigerians. Of course, the educational sector is not left out, by giving scholarship and bursary to 100000 students in our tertiary institutions who are studying science, technology and mathematics. So, we spent times planning and laying the foundation for a sustainable growth of the economy. But what people must appreciate is that it is not easy to struggle and maintain balance when you are suddenly faced with loss of over 60 per cent of your total earnings. Our case is like a person who had been earning N100000 a month, all of a sudden, he started earning N30000 a month, he would need to make serious adjustment. And it takes a discipline, dedicated and visionary leadership to really manage this kind of situation.
That is what we are managing today.
How soon should Nigerians expect the economic turnaround?
We thank Nigerians for their understanding. But the true of the matter is that the reason why we had to increase the price of petrol was simply because it is the only way the economy can survive.
Clarification number one: it is not about subsidy removal. We removed subsidy a long time ago. In the 2016 Budget there was no provision for subsidy, so you can’t remove what was never there in the first instance. And this is because in 2015 alone, the government paid about one trillion Naira in subsidy alone of which this administration paid N526 billion of it. Now, One Trillion Naira is one-sixth of the 2016 Budget! This is not just viable! Despite paying one trillion naira on subsidy in 2015, we spent most part of 2015 unable to provide fuel for many parts of the country. And unless we are living in denial, outside Lagos, how many villages and cities could anybody buy petrol at N86.5 in Nigeria? Throughout the south in the last two years, they had been buying fuel N150, N200 a litre. I travelled sometime in December, outside Lagos, we bought fuel at N130, N140, N150 a litre. And why did this happen? It is as a result of the massive drop in the price of the crude oil. Nigeria, like I said, lost 60 per cent of its total earnings. The independent marketers who normally imported fuel into Nigeria were unable to do so, because they had no access to foreign exchange; and they could not open new letters of credit, so, they simply folded their arms! The burden was now left to the NNPC to importing petrol and since October last year till today, NNPC has been responsible for 90 per cent of all the petrol we’ve been using.
How did they do it?
Not that they had any foreign exchange, but they were exchanging the 445000 barrels of crude which ought to have been meant for our local refineries, they were exchanging this to bring in petrol. However, the snag there is that, even if that 445000 barrels were exchanged for refined products, it accounted for only 48 per cent of our local consumption, so, CBN had been deepen its hands into the crude meant for the federation account to supplement.
Last month, the total amount of foreign exchange that was available to Nigeria was 550 million dollars, and the NNPC would have needed 500 million dollars of it to bring in petrol, so, the government said no, this can’t continue! If we had not done what we did, we would have been left with only 50 million dollars to be shared between the Federal, state and local governments. That is what informed our decision. That look! Oil marketers, go and source your foreign exchange from the secondary market. Henceforth, nobody needs any licence to bring in petrol, but you must inform DPR so that quality control is ensured. What is going to happen now is that everybody who has the resources can now go to the inter banks, buy dollars, open letter of credit and bring in petrol. So, in a very short time, the price will come down. We’ve seen it before, when GSM first came, only the rich could afford GSM, because the SIM card alone was costing between N28000, N38000. Today, they almost give you free. There was no per second billing until Glo came with competition, and today, if you go to my village, even grandmothers also have GSM. Or take the issue of diesel (AGO). At time, the AGO while it was not deregulated, was more difficult to find than petrol. And despite the fact that it was the by-product of petrol, it was costing much more. Today, the cost of diesel has come down from N170, N180 …. despite the weakening of the Naira. We do not have any doubt in our mind that this is the best thing to do. Oh yes! It is going to be painful to Nigerians, but only for a short term.