• Sunday, December 10, 2023
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Oronsaye Report lists cost cuts to raise quick cash


To fund its programmes, the Bola Tinubu government is inflicting new taxes on struggling Nigerians but merging government agencies and parastatals with duplicating and overlapping functions, presents easier options to raise sustainable revenue, BusinessDay analysis show.

For example, the functions of the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices and Other Related Offences Commission (ICPC) are the traditional functions of the Nigeria Police.

Though these two Commissions were established separately to address corruption, which the Police appeared to have failed to do, successive administrations have ironically continued to appoint the Chairman of the EFCC from the Police Force, while the methodology adopted by the ICPC in conducting investigations as well as the training of its personnel in investigation procedure are carried out by the Police.

These three organisations have a combined budgetary allocation of N926.8 billion in the 2023 budget with the police having the lion’s share at N871bn, the EFCC at N41.1bn, and the ICPC N14.7billion.

“One wonders if it was really expedient to dismember the Nigeria Police rather than allow it to evolve as a vibrant and effective agency,” members of the Oronsoye panel in 2012.

Therefore allowing the police to carry out its functions would have saved the country N55.8 billion which is five times the expected revenue Tinubu’s government is hoping to realise by the N1,000 tax, the government is imposing on car owners yearly to renew the proof of ownership on their car, a concept many have lampooned as being utterly ridiculous.

The Oronsoye Report contains numerous proposals that a government that is sincere about economic reforms would start implementing immediately which will save billions previously wasted in recurrent spending.

Officially known as the Report on the Restructuring and Rationalization of Federal Government Parastatals, Commissions and Agencies, submitted to the Nigerian government in 2012, the Oronsoye report was commissioned by the Goodluck Jonathan administration in response to concerns about the size and cost of the Nigerian public sector.

The committee headed by Stephen Oronsoye, made far-reaching recommendations. It found that the arbitrary increase in the number of parastatals and agencies is the main cause of identified overlaps and duplication of functions.

The Committee observed that the splitting of the parastatals has not necessarily improved their performance and service delivery, but rather exacerbated their inefficiency and ineffectiveness, as well as the cost of doing Government business.

A case study is the Nigerian Communications Satellite (NigComSat) Limited, which was established as the commercial arm of the Nigerian Space Research Development Agency (NASRDA), with a sunset clause, has expanded its scope and is in rivalry with its parent body.

The Nigerian Communications Satellite Corporation Bill was passed by the House of Representatives. Besides duplicating the satellite development functions of NASRDA, the Bill has created further needless duplications as it veers into the statutory functions of the National Broadcasting Commission (NBC) and the Nigeria Communications Commission (NCC) in the area of frequency allocation.

It called for pruning down the number of personnel on governing boards of the parastatals, agencies, and commissions which the committee found to be too large and unwieldy with some of them having as many as 37 members or more. It recommended seven with each representing different geopolitical zones.

While the report notes the importance of research agencies to development, the problem with those in Nigeria is that they not only perform overlapping functions, there is no synergy and the bulk of their funding goes to paying salaries.

“Consequently, there is a duplication of effort, energy, and resources as well as overlapping of functions with very little result to show for the investments made. For example, some research institutes have been in existence for as long as 30 years, while the country still relies heavily on foreign import in key areas of national development,” the report said.

It also found that a common feature of virtually all the parastatals is the prevalence of high Personnel Costs. Many of them receive more budgetary allocations for personnel than they actually require because that component of their budget is usually inflated.

The federal civil service employs nearly 90,000 people, most of whom are under-utilised, and the government will spend N7.108 trillion on recurrent expenditure this year, with personnel costs, overheads, pensions, gratuities, and retirees benefits for public servants amounting to a whopping N5.740 trillion.

The amount available for the capital expenditure of ministries, departments, and agencies stands at a mere N3.536 trillion for 2023.

The Oronsoye Committee said implementing the law required the buy-in of the legislature as some of the reforms proposed include amending provisions of the constitution that sets up agencies with overlapping functions. It also cautions lawmakers to stop adding new agencies with every new law.

Since the Oronsoye report was submitted in 2012, over 100 new agencies and parastatals have been formed according to BusinessDay calculations.

The Buhari government failed to implement the report due to a lack of political will. Tinubu’s policies indicate an abundance of political will to take difficult decisions, Nigerians wonder what he would do if they are at the cost of his convenience.

“I have argued that this (implementing the Oronsoye Report) is how to deal with the cost of governance- from a structural and strategic point of view instead of endless firefighting on cost control and management,” one expert told said.

Sources close to the government say practically all Federal Government ministries and departments are scared of the Oronsonye report and its contents. It ends a culture of impunity and entitlement and sets up rules that will deter mediocrity.

A former government official told BusinessDay that implementing the report will require someone of Ministerial rank, a strong personality, and lots of courage but wise to the ways of the Federal civil and public services. This person must be a member of the Federal Executive Council, with a small dedicated team but without the ministry administrative structure to hold the team back.

“In addition, the report must be updated to account for the additional MDAs created in the last 12 years,” he said.

The report itself is due for review since new agencies and laws including the Petroleum Industry Act has been passed. Experts are calling for the same diagnostics as was done by Oronsonye’s team to develop a new white paper. This will involve the lawyers drafting bills to implement the report, de-establish MDAs, merge others, and create new ones to replace them.

To achieve this, the implementer needs probably the biggest stick in the Federal Government, a team of highly capable people, a budget, a reporting line directly to the president, and for Tinubu to invest a huge amount of his goodwill with the National Assembly to persuade them in effect, to massively reduce the size of their feeding trough, said one expert.