In view of the volatility in oil price and consequent heavy borrowing to finance budget, Nigeria should urgently address the perennial issue of high cost of governance through the opportunity offered by the present Constitution review by the National Assembly.
Cutting high cost of governance in Nigeria to allow the system allocate more funds to capital projects for development has been a demand by stakeholders over the years but this was brought to the fore by the President of Institute of Chartered Secretaries and Administration of Nigeria, ICSAN, Bode Ayeku while speaking to BusinessDay recently in Lagos.
For instance, in 2021 Federal Government budget, recurrent expenditure estimate of N5.65 trillion accounts for 43 percent of total expenditure for salaries and overhead cost in the ministries and department agencies of the public service.
But according to Ayeku, with the financial situation in Nigeria, occasioned by revenue shortfall which has necessitated heavy borrowing and the outlook that does not seem bright “there should be modifications in the Constitution to reduce cost of governance to allow the country to prosper”
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Nigeria, he said has a unique opportunity to shape the future through the amendment of the Constitution to reflect current realities. “We cannot continue with high cost of governance. It is not sustainable for a rich country much less a poor country like Nigeria”.
With over N33 trillion debt profile (foreign and domestic), ICSAN President wondered why the heavily indebted country is still going ahead with heavy structure that gulps almost half of its annual budget. “This is what cannot be found in the private sector. A private sector will carry out restructuring from time to time to reposition the organisation for survival”, Ayeku who is a lawyer said.
Towards reducing cost of governance, he supports the amendment of the constitution that will prune down the number of ministers and ministries. He believed that the nation will find it difficult, in the present circumstance, to afford 36 ministers as provided for in the Constitution. “May be as at the time the constitution was released in 1999, there was money and now there is no money, why should we not consider our present predicament and do things that will reflect it”
For Nigeria’s elections, he called for electronic voting as part of efforts to reduce wastages. He said the nation cannot afford huge cost that is avoidable.
“If we are in 2021, there is no reason we should not be preparing for electronic voting by 2023. We have sufficient time to do that. We cannot be borrowing to finance elections instead we should be borrowing for development”.
The lawyer who is an advocate of corporate governance called for devolution of powers so that the pressure on the central government will be minimal. In this regard, he said each state of the federation should be encouraged to be self-reliant and manage their resources. This will bring about creativity, development and job creation.
This idea of relying on oil to develop the economy, he said is not sustainable as the oil market is volatile. “We need to do something so that every sub national will be in a position to stand on its own”.
Citing some developed economies that do not have natural resource as they are able to use what they have which is human capital to manage their economies, Ayeku said Nigeria which is blessed with natural resources like many other African countries should allow states to manage those resources
Worried about the rising debt profile, the outgoing ICSAN president who was happy about the restoration of the institute as board member of Corporate Affairs Commission said, the institute is not against borrowing to finance infrastructural deficit but said such loans must be used for the purpose for which they were borrowed instead of using them for consumption purposes.
