All is not well in Nigeria, says Oshiomhole

Governor

Oshiomhole made the observation in Abuja at the inauguration of the Employees Digital Welfare Scheme (NEDWS) project. He said that he agreed with Sanusi that the structure of public spending was not sustainable and the pattern of spending cannot deliver development.

The governor said it was an open secret that 80 per cent of the country’s budget at the federal level was on recurrent expenditure and that only 20 per cent was for capital expenditure.

“The fact that 80 per cent go to recurrent is not sustainable. We cannot continue and we now look at the fact that the other 20 per cent is borrowed from the domestic market.’’

He said what Sanusi should have called for was 50 per cent cut in overhead cost and not 50 per cent cut of labour which was a critical factor of production.

“Labour is a wealth creator, not just a cost factor, it is a productive factor as capital cannot turn itself around without labour input, even with a digital world; you need labour to press the button.’’

He argued that what constituted the recurrent expenditure was not wage bill of N18,000 being paid to workers but personnel cost which include cost of transportation, especially money being spent on air transportation.

“Who are the people who over-subscribe the British Airway Business Class? They are ministers, civil servants, executive directors, deputy directors and legislators. All of that is what is called personnel cost.

“If we all fly like that as we do, if you put all of that together, one trip is more than the annual salary of a public officer.

“Let us cut the frequency of travel. Other than the minister of Foreign Affairs, other ministers should minister here; the governors should stay here and govern here.

“When we stay here the personnel cost will drop. So, it is not a correct argument that the burden of the economy is the wage bill.

“Our wages are still low relative to the cost of living. We are not about the best pay on the continent, when you use dollar as a bench mark and you put other factors into consideration.’’

Oshiomhole said that part of the reasons why the recurrent expenditure of the country was high was the cost of servicing its debts.

He explained that Nigeria was the only country where “government borrows at 12 per cent through bonds.

“What that means is that Nigeria already owe at the federal level, about six to seven trillion naira. It requires 12 per cent of that to service domestic debt.

“All of that goes into recurrent, but should Sanusi drop the interest rate from 12 per cent to eight per cent, the cost of servicing debt will also drop and then the cost of recurrent expenditure will drop, lets engage him on that.

Oshiomhole disagreed with those who said Sanusi talks too much “because I think people in high places should talk so that they open the window for us to join the debate, either to generate more confusion or some clarity.

“We cannot continue to behave as if all is well, all is not well. So we cannot afford to have grave yard silence.’’

The governor, however, urged the Nigerian Labour Congress to engage Sanusi on what must be done to curb financial recklessness and issues that would better the country’s economy.

“We really need a healthy debate on how we can restructure our public financing and put more money where it will have benefits on the lives of the people.’’