President Muhammadu Buhari yesterday defended the handout by the Federal Government to states to cushion the financial crisis that prevented them from paying workers’ salaries. He said the beneficiaries needed help to overcome the cash crisis arising from a plunge in their revenue owing to the reduction in the amount of money they were getting from the Federation Account because of the sharp drop in oil price at the international market that reduced the net receivables to the federal purse.
Buhari, represented by Vice-President Yemi Osinbajo at the 21st Nigerian Economic Summit in Abuja, said the Federal Government’s decision was in order even though some of the states indulged in financial recklessness. He added that his explanation was important to understand the background of the bailout. He said: “We must accept that it wasn’t just a matter of state governors not behaving well, using money and then we needed to bail them out.
Everyone recognises that the states were getting far less than they got even within the same period. “For example, a state that was getting N4.6 billion a month from federal allocation was down to N2.1 billion because of the drop in oil revenues, which of course you know is the main source of revenue.
So, when you have that kind of drop in oil revenue, it means that the states will be in trouble, especially many of the states that have very little internally generated revenue.” He said the Federal Government responded to circumstances, which in the first place were beyond the control of the states.
“So it wasn’t really a situation where we were responding to this in the sense that this state has done very badly, they just misspent money. I am not necessarily absolving anyone from any kind of fiscal indiscipline or anything like that, but I am just saying that the reality was that the states were earning so little,” he added.
The summit, with the theme: “Tough Choices: Achieving competitiveness, inclusive growth and sustainability,” provided an opportunity for the panelists to tackle the vice-president on some issues in the polity. Speaking on the current drive by the government to tackle corruption, Osinbajo said the most potent weapon of dealing with corruption was for people in positions of authority to demonstrate a lifestyle worthy of emulation. He acknowledged that the fight against corruption would be difficult to win if the government lacked transparency and accountability in its dealings. He said: “What Nigerians want to see is serious performance and actions. They want to see those who will be held responsible for anything.
“The question of corruption is one that is a systematic one. It is one that has eaten deep into all sectors of public and private life. But I think the most important thing here is that there is a determination and a focused administration committed to fighting corruption with sincerity.
“If you are looking for a quick solution or some kind of agenda that very quickly defines what is possible, then I can just offer one and that is that. First, we think that leadership that exemplifies what you want to see is what the country has lacked for a long time. But I think that what people want to see is leadership itself exemplifying that conduct before you are able to say it to others.
“So for us, the starting point is by leadership and that is government exemplifying the conduct that they expect from the people. He reaffirmed the need for an open and transparent government, saying that the president, the vicepresident and ministers must demonstrate what the government wants to achieve as regards accountability.
On insecurity, especially in the North-East, he said beyond the military onslaught, the government would evolve an action plan to engage the youth by providing them with jobs. He added that the current administration’s economic model would include substantial social investment over the next three years as the present development leaves government with tough choices. He said: “As we take the tough macro and micro decisions for accelerated growth, we are compelled to redress the paradox of high growth figures and widening inequality, rising unemployment and poverty. “It is evident that any economic model that leaves nearly half of the citizenry behind requires rethinking.
This is why our economic model will involve substantial social investments over the next three years. “The tragedy of thousands of orphaned children poses huge social challenge. The cost of rehabilitating destroyed infrastructure and homes is huge. To effectively compete for international and even local investment, we need to improve our position on the ease of doing business indexes. This calls for both radical improvements in bureaucratic delays in obtaining investment processes and also substantial investment in infrastructure, especially power, roads and technology.”
The meeting, which was at the instance of Buhari, was held under the auspices of the Nigerian Governors’ Forum (NGF) to interact with the international partners. Chairman of the NGF and Zamfara State Governor, Alhaji Abdulaziz Yari, told State House correspondents at the end of the meeting that they were also briefed by the Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC), Dr. Ibe Kachukwu, among others.
Yari said: “There are funds from the World Bank which states cannot access because we don’t know how to move it forward as a result of lack of expertise. The permanent secretary, Ministry of Health, briefed us on how we can access the $500 million in that area. “Secondly, we used to complain on the NNPC, but with the fact we have got today, it is different in the sense that the NNPC is going to be a different organisation.
“It is going to fund the economy fully in the sense that there won’t be any question of pipeline breaking or the stealing of oil. We have taken care of that, especially we are looking at instead of using the military only, why don’t we use technology to safeguard our pipelines?”
