Private sector-led involvement can curb graft in government
Senator representing Ogun West Senatorial District, Tolu Odebiyi, has observed that corruption is not even a cancer anymore, as it has become part of the country’s DNA. He also spoke on other issues in this interview with JOHN AKUBO. Excerpts:
What can be done to overcome the challenge of corruption and its effect on poor state of infrastructure?
We have to, first of all, agree that it is either we kill corruption or corruption kills us. We have to agree that corruption is not even cancer anymore; it has become part of our DNA, our make up. Before, we thought it was an ailment; now, it is an ingrained part of the system. Corruption accounts for so much of our deficits and some of the challenges that we are having in this country. What we have to look at is, if, for instance, government hands off capital project, we can curtail corruption significantly. You allow the private sector and pay people living wages. All that money that would have gone into capital projects would have been used to pay people living wages. The reason for corruption is because the government is the one doing the road; it is doing the rail; government is doing airport. It does this and that; that is why you having corruption. Everybody goes through the whole bureaucracy.
But come to think of it: if you have to make a bid as a company, you will see that the contract costs and corruption will go down. I’m not saying it is going to eradicate corruption entirely, because there is also corruption in the bidding process. But you can make it transparent, give everybody codes or bidding numbers. You don’t need to know the company. We have to start looking at all these things and then you realise corruption would be reduced to some extent. The little money you have you now put it in education and pay people living wages.
Why are some people into corruption? Some do it is out of greed; some do it out of fear of the unknown, because nobody is certain of tomorrow. To some people, it is poverty mentality. They need to have 50 houses for them to feel secure; yet they don’t feeling secure as they continue to amass. It is not fair.
With Nigeria Export Processing Zones Authority (NEPZA), do you see opportunity for increasing internally generated revenue for states? What are the chances for a vibrant economy?
My concerned is that we keep doing the same thing over and over again even when we are not getting results for our problems. One of my greatest worry is that our population is growing at a very fast rate. A population that is growing at 2.7 per cent annually, that is, at about five million, I mean, it is not sustainable. The population is growing and there are 90 million people living in poverty; unemployment is about 45 per cent right now. These statistics are very worrisome and one of the things that we should start looking at is to create economic zones that government would actually subsidize by providing infrastructure, creating the enabling environment and a way to protect these industries and encourage people to come and set up shops. Even if it is going to be at a really subsidized rate, because what we are trying to do is to bridge the unemployment gap; what we should know is that initially we may pay a price, as we might not be generating a lot of money, because the government is subsidizing it. Industries come there and they are able to bridge the unemployment gap. It is also an added benefit to the country. We need to start focusing on the productive benefits of these areas of the economy.
I look at the younger generation, and I’m wondering how we can invest in agriculture. I would also like us to invest in technology parks, fibre optics, with embedded power plants in the area, industries would just come and set up and start producing. These are the kinds of things that you would like to see. We need to have them around. It is obvious that we may not be able to take care of all our infrastructure deficits at once but if we have targeted productive areas and we are providing them with infrastructure to work, that can also help a great deal. I believe that establishing enterprise zones is the best way to go if it is well planned and implemented and if the objective is to manufacture, to produce and is to also create employment for our citizenry.
You talked about not getting the infrastructure at once and also how to leverage on private funding. But how possible is it to get government think in this direction?
If I had the opportunity, one of the things I would suggest is that really and truly, the government should start thinking of how to get out of capital projects and allow the private sector take charge. My thinking is, why is the government doing rail? Why not privatise the rail? If we don’t have the funds, why not allow the private sector do it? In America Rockefeller started the rail thing. A Dangote can do the rail. A private sector player, somebody can come in to do the rail and they will also make money out of it. The population is there. So the limited money that we have we put it into areas that would work for you like education, health. If China wants they should come and do rail for us and they run it. By so doing we lesson our involvement in doing capital projects and let the private sector handle them.
But there is the Ajaokuta case where some companies are willing to fix the dilapidated federal road but the government refused. Why is that?
That is why I said there is need for us to look at our own policies too and see whether we are self-inflicting. You are talking about Ajaokuta. Come to Agabara; I weep when I see the quality of companies there – Nestle, P&G, all the top companies in this country; about 60 of them that their global credit rating is even better than our country’s rating. Some of them are there, but come see the roads – trailers are failing down and containers are being thrown overboard. It is pathetic, and what I am also saying is that in Nigeria today most of our industries are working at 35 per cent efficiency; they are under-performing, because the infrastructure is not there for them.
They are working at 35 to 40 per cent of their production capacity. That in itself creates unemployment, because I cannot employ if infrastructure is not there because I cannot move my products. The companies are also going to limit employment, but if they were producing at 90 per cent with the roads, power and other infrastructure are there, they can hire more people because they would be producing 24 hours. But if they are not working to capacity because the enabling environment is not there, infrastructure is not there and they cannot run on diesel all the time, they will only do the little they can do to keep afloat. These are some of the challenges that I see. We need to look at our policies; we need to liberalism capital projects.
Looking at all the projects, I can’t see how government alone can undertake them. They are massive. The infrastructural deficit is too much. So, it is a problem. If a company wants to do a rail from Lagos to Ibadan, you give it the right of way. You let them do it. If you want to do a rail just like the Russians signed agreement with the president now, they are welcome. Let us showcase what we have. We have the human capital; we have the resources, the population, we have the minerals. If they want to come here and make money by building infrastructure, let them do it so we pool the little money available and focus on education, health, technology and other areas that can really help us move up.
In these free enterprise zones, power is a challenge and agriculture is an opportunity not fully tapped. Do you think the budget process offers the opportunity?
It is not what can be done at once. The budget process has started; we are in the middle of it. The president has presented the budget amidst some challenges, because you can see that even the issue of revenue challenge is there and the president wants to do much. He wants to tackle infrastructure; there is insecurity and he wants to do so much on education but the revenue is also a challenge. He has to realise we can’t do it alone. We can open up our markets to the private sector people, to industry. What I find ironic is I have a lot of friends in the private sector; they are looking for jobs; they are looking for things to do, too. They have access to money; they know where they can get resources. They are also going around looking for projects. Why don’t we create areas for them, let them just start cracking their heads and looking at how they can come with projects? We must have very strict guidelines and compliance that you have to meet. The power plants and power sector were given to people that really don’t have the capacity.
Many of them were looking at the money aspect of it than the capacity and the implementation and thinking maybe when they buy all the revenues would be coming in every month, but they have now realised they cannot meet up. They have realised that apart from that initial capital there are other investments they have to make.
They realised also that connection is another issue, especially the DISCOs. It is quite tasking. It is an area that can be profitable, but honestly the people that we have now seem to be struggling; they don’t have the capacity. At some point, we have to look at the power sector again. I just believe it hasn’t worked the way we had anticipated.
Now that you are in government, what are the major challenges in getting things done faster as it happens the private sector?
I think one of the things you first learn very fast when you come from the private sector like I did is that the public sector doesn’t work as expediently as you would want. Decision-making is very tough in the public sector; by the time you talk to one or two leaders there are procedures; there are paper works, there are policies. I think that is one of the things that the government is trying to look at in the Ease of Doing Business. How do you make it less cumbersome? I am the Chairman of Procurement Committee; when you are looking at procurement it takes you how many weeks to bid; another many months to do this and that. All these procedures just become so tasking, and time is money and all these things don’t get done, as you want. I think there is need for us to streamline the process, find a way to be more efficient in the way we do things to make our processes less cumbersome. When you talk about procurement, it takes you weeks. All these procedures just become so tasking and time-consuming. There should be some infusion of private sector mentality to come in to the public service.
One of the things I found when we were doing budget presentation is that a lot of the MDAs and everybody that came were preoccupied with just salaries. That to me was most shocking. You have a lot of these institutes and agencies while defending their budgets talked mostly only about their salary that is this, the overhead that is that. They don’t generate anything; what they do is just pay salaries. We are a very unproductive society. We are just paying wages and it shows. Are you saying if the country is sold to them today as a private business, in one or two years they would not make profit on it? But they have been there for over 15 years, salary is being paid monthly and promotion comes every two years yet there is no innovation. One of the things I was thinking is, how we can fuse the private sector spirit into these government agencies and see how they can help us rejig, maybe give them some kind of incentives like getting 25 per cent? It is something more creative. I can see that those that are there cannot go beyond what they have right now in terms of innovation, creativity and that kind of thing. I think there is need to look at that. How do we make these enterprises more productive? How do they increase their IGR, look at what they are doing and think on how to commercialise some of these innovations?
Don’t you think the issue of compromises, especially political patronage, make what you are talking about impossible?
I will be honest with you: it is either we turn this ship around fast or we are all going to sink. If people are bringing politics in they should know we are running against time. I keep saying it. The price of the commodity we are all relying on is going down by the day; the demand is going down; fossil fuel demand is going down. In the next 10 years, they would not be buying it as they are doing now. Our population is also increasing and unemployment is increasing. So, we don’t have time. People have to start getting serious to move this country forward for the sake of the population yet unborn.
Agriculture offers opportunity to reduce unemployment. Are we really tapping into it?
No; we are not, and it is also an area that offers us a lot of opportunity. There are two levels of agriculture; you have the large-scale agro-allied companies, but you have to be specific in the one that you want and create the enabling environment for it to work. They can quickly hire people and get them to work and then you have the medium and the small-scale agriculture. What I found when I was working in the state is that our approach to agriculture is a top-down approach. I think it should be a bottom-up approach. A lot of it is done by the ministry; the people on ground at the local government just know that the Ministry of Agriculture is the one doing a rice farm. They don’t have any connection with what is being done.
If you go to their neighborhood they don’t take ownership of it whereas it should be that every local government in this country must have an agriculture policy. Every local government must embark on an agriculture programme and the ministry now does oversight and support and then from there the value chain comes in. I think if you do a bottom-up approach and then the people take ownership, everybody can look at what is peculiar to their area, like if I want to do aqua culture because I am close to waterside then the ministry will give you the necessary knowhow and help you in that. In that way it is a local government thing and the people there would be involved.
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