How bad politics puts economy in distress

The Nigerian economy, certainly, has become a weeping child and an endangered species bayed about ferociously and gnawed deeply not only by a monstrous recession but also by a mindless and bad politics. The style of politics being played in the current dispensation may have put the economy in jeopardy. The politics of hate, even among politicians of the same party, as exemplified by the impasse between the Executive arm of government and the Legislature, seriously constitutes a clog in the wheel of progress of the country. Although internal wrangling has been part and parcel of many administrations since 1999, at no time has it been as suffocating as it is now.

Analysts have said that with the lingering squabbles between the Presidency and the leadership of the National Assembly, the politics of pull-him-down-syndrome, lack of interest by government in pursuing and completing projects started by previous administrations, and the politics of settlement and of “robbing Peter to pay Paul” as it were, the economy cannot do better than its current state, unless the ills are addressed.

 

 

Executive-Legislature faceoff

 

As the face-off between the Executive arm of government and the Senate deteriorates, delay in the passage of the 2017 budget will hinder Nigeria’s chances of getting out of economic recession, analysts have warned. The inability of the Senate to pass 11 economic recovery reform bills would further hinder Nigeria’s chances of exiting the current economic woes.

President Muhammadu Buhari had presented N7.298trillion 2017 budget estimate to a joint session of the National Assembly on December 14, 2016. Recall that the 2016 budget, which was passed by the National Assembly on March 23, 2016 and signed into law by President Muhammadu Buhari on May 6, was plagued by being declared ‘missing’ and padding.

However, while many experts had hoped that the 2017 appropriation bill would be passed on time by the legislative body, the face-off between the two arms of government saw the relegation of governance to the backstage even as politics occupied centre stage.

Danjuma Goje, chairman, Senate Committee on Appropriations, says that the budget will be passed before May, almost two months later than the March 30 deadline given by Senate President, Bukola Saraki. Speaking to National Assembly correspondents, Goje said parliament may be compelled to extend the validity period of the budget, in the event that it is unable to pass the 2017 Appropriation Bill on or before the midnight of May 5, 2017.

He explained: “Last year, when we were producing this 2016 Appropriation Bill, we realised that at the end of each year, there were usually requests for an extension of the budget from the executive. To avoid that, we decided to incorporate this new thing.”

According to Goje, “In the 2016 Appropriation Act, which President Muhammadu Buhari signed into law, clause 11 of it says that ‘in line with the provisions of Section 318 of the Constitution of the Federal Republic of Nigeria 1999, as amended, this bill will run for a period of 12 months, starting from the day it is assented into law’.

“President Buhari signed this bill into law on the 6th of May, 2016. This means this budget will run from that date up to the midnight of 5th of May, 2017. Unless of course if the Act is amended or altered as deemed fit by the National Assembly.

“As far as the law is concerned, there is no need for any extension or mop up by Ministries, Departments and Agencies (MDAs). The mop they usually do will now be illegal. Except the National Assembly, in conjunction with the executive, amend this law, this is the position of the 2016 budget.

“We do not have to extend the 2016 budget. If May comes and there is need to extend, then we can do otherwise. I believe before that date, the 2017 budget will be passed. For now, this is the position of the law.”

This implies that Nigeria’s Economic Growth and Recovery Plan, which has several critical implementation components, contained in the 2017 budget will be delayed. The National Collateral Registry Bill and the Credit Bureau Services Bill which the National Assembly had promised will be passed by the end of April to ease access to credit. It is part of 60-day ease of doing business initiative of the Federal Government.

The Federal Government has also expressed concern that delays in the passage of the 2017 Appropriation Bill by the National Assembly may stall the implementation of its Economic Recovery Growth Plan (ERGP), even as it attempts to tie exiting country recession by end of the year to early passage of the budget as well as the full implementation of the ERGP.

Minister of Budget and National Planning, Udoma Udo Udoma, said: “The 2017 budget is structured to get the economy out of the recession before the end of this year‎. So that is why we are anxious to get the budget passed so that we can begin the implementation and begin to take all the steps we need to get the economy out of recession”.

Delayed passage of the budget means that businesses waiting on the 2017 budget to rev up their operations for the year would now have to wait much longer. Another casualty from the delayed passage of the budget is the 11 economic reform bills, which Saraki had promised would be passed alongside the 2017 budget.

The economic recovery bills include: the Petroleum Industry Governance Bill, National Development Bank of Nigeria Bill, National Road Fund Act (Amendment) bill, Federal Roads Authority Act (Amendment) bill and National Transport Commission (Establishment) Bill.

Others are: Nigerian Ports and Harbours Authority Act (Amendment) Bill; National Transport Commission Act, 2001 (Amendment) Bill; Warehouse Receipts Act (Amendment) Bill; Companies and Allied Matters Act (CAMA) (Amendment) Bill; Investment and Securities Act (ISA); Customs and Excise Management Act; Federal Competition Bill.

Experts say the 11 priority economic reform bills, if passed into law, will help create 7.5million jobs and reduce poverty by 16.4 percent.

In a chat with BDSUNDAY, Senate Spokesperson, Aliyu Sabi Abdullahi, explained that the National Assembly Business Environment Round table recommended 54 economic bills for either amendment or repeal as well as 50 other bills for passage.

He said of the 54 bills, 11 of them were categorised as ‘high priority’ admitting that other bills not considered as high priority have been passed by parliament.

“Some of the bills have already been passed because they have to do with credit, electronic payment system. Already we are taking some of the economic bills concurrently. At the end of the day, perhaps, what we will do is after we pass the bill, we will take stock and see out of the economic bills which one has been passed and which is still outstanding,” he said.

Also speaking with BDSUNDAY, an economic expert, Odewale Adisa, said: “Our elected leaders promised to uphold the tenets of the constitution but it is unfortunate that rather than do so, they are putting personal interest above national interest.

“Like the saying goes: ‘When two elephants fight, it is the grass that suffers’. Two years into this administration, the government is yet to find its bearing and the masses are suffering from the face-off between the two arms of government. The earlier they realise this and make amends, the better, otherwise they might be putting the nation’s democracy at great risk”.

Although the Federal Government expressed optimism that the 2017 budget would get Nigeria out of recession, most Nigerians think otherwise. An online poll by the Policy and Legal Advocacy Centre (PLAC) reveals that 55 percent of Nigerians do not believe the 2017 budget proposal will steer the country out of recession.

 

 

Discordant tunes by Buhari’s men

 

Unfortunately, in spite of the All Progressives Congress (APC) being in control of the Senate, it is yet to take advantage of its numerical strength of 66 senators as against PDP’s 42.

The increasing conflict between the Presidency and the Senate is seen as a reflection of the strangers that came together to form the All Progressives Congress (APC) and are now finding it difficult to work together. This is further complicated by the President’s inaction and unnecessary quietness in the midst of the crisis.

Top government functionaries and party leaders are now rising up against the APC-led Federal Government, in what is a clear indication of a divided house. Only last week, Minister of Women Affairs and Social Development Aisha Alhasan, led some members of the APC from Taraba State to the national secretariat of the party in Abuja over neglect of party members in the state by the APC-led government. In the same token, the Adamawa State Governor, Jibrilla Bindow, warned that he and his officials may be forced to dump the ruling party if federal appointments and projects were not addressed.

Many political observers say the discordant tunes and inter-agency rivalry within the Presidency are indicative of the fact that the President is not in charge.

They cite the face-off between the Economic and Financial Crimes Commission (EFCC) and the Department of State Services (DSS). Both agencies are under the purview of the President, this giving the impression that all is not well in the Presidency.

Recall that the Senate declined to confirm the nomination of Ibrahim Magu as substantive chairman of the EFCC for a record second time based on DSS report, which claimed Magu lacks the integrity to lead the nation’s anti-graft crusade. There have been rumours of a powerful cabal around the president, said to be in charge and always have their way, even when it is against national interest.

The Convener, Coalition of Democrats for Electoral Reform, Ayo Opadokun agrees with the school-of-thought that President Buhari is no longer in charge of the country. He therefore, called on the President to be on his toes, adding that people voted for him because of his anti-corruption stance.

He said: “Our national crisis of identity is being further damaged by the conduct of the Nigerian state. President Muhammadu Buhari by conduct and behaviour over Magu’s confirmation is indicating to his admirers and those who voted for him that he is no longer in control of his government.

“There are two or three major unfortunate developments that are showing a divided presidency, clearly telling Nigerians, perhaps, that the Buhari we thought we knew in the 80s is totally a different personality now.

“The fact that the so-called DSS will now be writing a spurious and pedestrian report on Magu is an unfortunate dimension. I see this as humiliation of what Magu stands for and it is an unfortunate dimension to our so-called anti-corruption determination of President Buhari.

“Let me say clearly, President Buhari needs to be on his guard. The only reason that people voted for him was because of his promise to fight corruption because if we do not fight corruption, corruption will fight us and it fought us too badly.”

 

 

 

Non-sustainability of previous government’s projects

One of the economic drawbacks in Nigeria has been the inability of governments to sustain projects started by their predecessors. In Nigeria, particularly, when a new government formed by a different party comes on board, all the projects no matter how good, started by previous administration are usually discontinued, even though such projects may have gulped a lot of money. Although government is a said to be a continuum, it is more on paper than in practical.

Recall that the National Conference of 2014 convened by President Goodluck Jonathan, which drew some 500 delegates and lasted for five months, cost Nigeria some billions of Naira. Today, the huge books containing the recommendations are gathering dust in the seat of power, Abuja. The current government says it is not under any obligation to implement the recommendations.

“I think all the political parties in the country are guilty of this kind of thing. I bet you, if it were PDP, it would still not have implemented the recommendations so that the government that initiated it would not take glory,” a prominent member of the ruling party said, seeking anonymity.

According to the politician, “Even in states where the governor that is in charge at the moment is of the same party with his predecessor, there is that unwillingness to continue with some of the noble ideas and projects of the past government. Unfortunately, unnecessary ego is causing a lot of problem in the country and the economy is terribly impacted in all these.”

 

Allocation of forex to party men contrary to policy on ground

Despite the good policy by the Central Bank of Nigeria (CBN) to reduce the pressure parents and guardians go through in the payment of school fees of their children and wards abroad, and also ameliorate the trouble of  Nigerians critically needing foreign exchange for medical trips abroad, there are unconfirmed allegations that forex meant for PTA, BTA, tuition and medical fees are now being given to some cronies, who are close to some powerful elements with tentacles in the corridors of power. Such alleged illicit deals put the economy in distress.

 

APC: A kingdom divides against self

 

With majority of those at the Senate and House of Representatives, being members of the All Progressives Congress (APC), one would think that the ruling party would be working in harmony to deliver its campaign policies.

But, almost two years after taking office, the ruling party is still immersed in internal bickering. The poor masses are at the receiving end as the prolonged political imbroglio now takes a further toll on the already recessed economy, especially with the drama in the passage of the budget. Many companies have continued to downsize, investors are withdrawing and little cash is out there to stimulate the system, yet government claims to have interest of the masses at heart.

While many await the report of the National Bureau of Statistics on the performance of the Nigerian economy in the first quarter of 2017, the economy which contracted about 1.5 percent in the last quarter of 2016, still does not show sign of improvement as critical issues such as passage of the budget are now used as politicking tools. 

We had expected that the Senate would fast track that passage of the budget in 2017 because the inability to pass the 2016 appropriation bill on time created fiscal uncertainties in the economy last year, and private sector operators, who are still groaning under huge losses due to the delay, are afraid of suffering again this year,” Julius Madumere, director, Small and Medium Scale Enterprises (SMEs) in an equity firm, says.

 

 

Bitter politics with President’s health?

 

When the President was abroad on a medical sojourn, many Nigerians believed that the country was vibrant on account of the then acting president Yemi Osinbajo’s determination to do things differently. But unconfirmed reports said that Osinbajo’s vibrancy did not go down well with certain elements who feared that the soaring influence of the cleric-turned politician was detrimental to their meal ticket. Analysts wondered why the President, who is still recuperating, could not just allow Osinbajo to continue with his acclaimed good job.

“As you can see, in the last one month, the country has returned to its usual slow mode. This state of inactivity is causing Nigeria billions of Naira on a daily basis and we, like the Ostrich are burying our heads in the sand and thinking that we are safe from danger. We are just deceiving ourselves,” said an Abuja-based quantity surveyor, who asked not to be named.   

Uguru Owanta, a political science lecturer at Ebonyi State University, said: “The leadership of the ruling party and the Senate are aware of the health status of the president, so many are becoming more ambitious anytime the president travels on health vacation. And those who see EFCC, DSS, the judiciary and others as tools to checkmate their ambitions, are the ones fighting back for tomorrow’s survival. The fight will continue and even get more fierce as 2019 approaches.”

Dimeji Adisa, a political analyst, thinks the political imbroglio is riding on the back of the seeming passiveness of the president, especially since the return from the longest sick leave ever by any Nigerian president. “For the once vociferous and active president to seem quiet something is wrong. The Senate knows this and is capitalising on it to hold sway and gather more influence. More drama awaits Nigerians, already some legislatures are calling for the president to resign on health ground, that is the biggest tool to fight with now and the president and his men know this. It is a matter of self survival. No one is thinking about the interest of the country. So, compromise is the game now and it is hurting the country even beyond recession,” Adisa says.

Umenna Olugu, an African political observer with a foreign agency says government is the largest spender in Nigeria, and the moment there is no official spending on project implementation, it results in cash squeeze which will affect different components of the economy. He urges for the passage of the budget, noting further that the executive, legislature, judiciary arms of government should forget their differences and selfish interests and give the Nigerian electorate hope to live because they promised to do that during their campaign in 2015.