By Dele Sobowale
“Tis is not the eating, tis not the drinking that is blamed; but, the excess.” John Selden, VANGUARD BOOK OF QUOTATIONS, VBQ p 52.
President Buhari’s government as well as those depending on it for their monthly stipend are in for difficult times in the last five months of this administration. For a government led by individuals hanging on to one idea of how to fund government operations, and that a wrong one, it is not easy to develop plan B in a short time to avert disaster.
Budgets, since 2016, had been predicated on the assumption that the Federal Government will generate less revenue than the proposed expenditure. The difference will be covered by borrowing. And, when other sources are not forthcoming, the Central Bank of Nigeria, CBN, as the lender of last resort, would cough up the needed amount. Buhari could go to bed each month end without losing a minute of sleep on account of a “job well done”.
Ignorance always brings peaceful repose – until reality disturbs the peace of mind. Right now, the ignored facts of the operations of Ways and Means facility since 2015 are sending shock waves through the entire FG structure. The FG, like an addict, denied his narcotic, is suffering from a violent withdrawal syndrome. The drug, borrowed funds, is urgently needed; but, is not now available from the formerly reliable supplier – the CBN.
Furthermore, there will be no new loans from the CBN until further notice until the gluttonous FG repays N23.7 trillion former loans which were swallowed by a government lacking in self-control; one which, like a child, took the easy way out of public expenditure financing.
OSINBAJO STARTED IT ALL IN 2015.
“It aint the things that you don’t know that cause the problem; it’s things you think you know that ain’t so’ Ralph W Emerson, 1803-1882, p 117.
Incidentally, the formerly outspoken and erudite Vice President, Professor Osinbajo, appears to have been silenced. The magnitude of the economic catastrophe the All Progressives Congress, APC, had unleashed on the nation might have hit him like a ton of bricks. He, unlike Buhari, knows that none of the top members of this government will ever be remembered with fondness by posterity. This failure will cling to him and the rest for as long as men exist in this country.
Appointed the Chairman of the Economic Management Team, CEMT – a position he should have wisely rejected – he was proud to announce to Nigerians the “biggest budget in Nigeria’s history for 2016”; with scant regard for how to fund it other than borrowing. That economic absurdity was unfolding as several economists were predicting a recession in 2016 on account of sharp drop in crude oil prices and exports.
The largest annual deficit was projected, based on borrowing without a credible repayment plan. Worst of all, the biggest allocation went to the Social Investment Programme – tucked under Osinbajo. Borrowing to fund a give-away programme was the equivalent of a jobless drunkard, owing the bar man lots of money, and still asking the bar man to “serve round”. It was totally irresponsible; and the VP was unaware of the economic lunacy because he was suitable for the role assigned to him. But, he did more.
Osinbajo recruited the Governor of the CBN, Emefiele, into the CEMT. It was an invitation the Governor should have declined. It opened the way for the accumulation of debts now totalling N23.7 trillion – which cannot now be repaid legally by the FG. That financial and legal road block is now what threatens to make the lives of Civil servants miserable for the four months left for Buhari to go.
SPIRAL OF ECONOMIC WOES
“One bad leader in a nation can cause more destruction than several invading armies.” Anon.
Granted, British Prime Minister, Harold Wilson, 1916-1995, had told us that “a week is a long time in politics”. Never in Nigerian politics have four months seem like eternity. Most Nigerians cannot wait to see Buhari’s back. But, before he departs, permit me to inform Nigerians about the spiral of economic calamities which will be unleashed. Nearly 90 per cent of Nigerians depend on monthly wages/salaries or daily take homes.
A few, like landlords live on rents paid occasionally – depending on the arrangements. Additionally, in most states, public servants constitute the back bone of expenditure for aggregate personal consumption. FG’s inability to pay full salaries and entitlements will be felt at every level of society and in every community. As purchasing power plummets, recession will creep in gradually and aggravate the economic hardship.
If workers are not paid, contractors, which are well below in line for monthly payments, will also face difficulties getting paid. At any rate, they are in the same boat with public servants. The FG had been borrowing to repay old loans. If one major source of loans dries up, rationing will necessarily occur. If that happens, only those highly-connected will get paid during the period until the government can re-establish its credit lines.
RESPECT YOUR FATHER AND YOUR MOTHER – PENSIONERS
“What does corrupting time not diminish? Our grandparents brought forth feebler heirs; we are further degenerate; and soon will beget progeny more wicked. Horace, 65-8 BC, VBQ, p 247.
If you want to know how good or bad a society is, watch how it treats its children and old people. Nigeria’s pensioners have been treated like horse manure since the 1980s; and their plight got worse with each government. Buhari is set to leave them in the worst peril ever – as he goes to Daura to enjoy his own huge benefits which will be paid unfailingly. Selfishness cannot be better defined.
I grew up helping one of my uncles to deliver his pension cheques to the Bank of British West Africa, BBWA, now First Bank, after the cheque was brought to his house by the postman. He was not alone. That was under the “wicked” British colonial rule. No pensioner had to leave his/her house to ask for their entitlements. Today, 63 years after independence, and with our brothers and sisters in government, pensioners now die in queues. Unfortunately, the current crop of public servants will deal pensioners the harshest blows. Life under Buhari has turned out to be the worst ever in Nigerian history. You were warned.
BORROWING TO CREATE MORE REASONS FOR BORROWING
“Subsidy: FG borrowing to import fuel, says Minister.” Report January 18, 2023
It is just as well that this is the last year of the Buhari administration. Otherwise, Nigeria would have been ruined beyond redemption. Even now, the next three governments will be working over-time just to repay the debts accumulated by the so called economist who governed us from 2015 to 2023. Granted, even Jonathan, with Dr Ngozi Okonjo-Iweala as the Chairman of the Economic Management Team CEMT, lacked the courage to stop fuel subsidy, Buhari who campaigned on removal of subsidy, and failed, had seized on the precedents established by his predecessors to continue with the ruinous policy of borrowing to subsidise fuel imports without restraints. The crunch has come in 2023. It will be interesting to observe how the government wriggles out of its own self-created tight corner.
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Last modified: January 23, 2023
