Feeding Fat on the Economy

Recently, President Umaru Yar’Adua was taught a lesson in the art of compromise, in a hard way though. The event was the signing into law of the 2009 budget, as passed by both chambers of the National Assembly. Coming after the executive and the legislature had lost precious time to unnecessary bickering over the passage of the budget, many observers had expected the ceremony to be a smooth-sailing one. But all hopes soon turned awry as Yar’Adua almost walked out of the ceremony in protest, irked that the document before him was a radical departure from his original proposal. He grudgingly signed the appropriation bill after he had extracted word from the lawmakers allowing him to introduce a supplementary budget.

Besides several bogus insertions into the budget, which had massively hiked the revenue and expenditure projections of government from N3 trillion initially proposed by the executive to an unprecedented N5 trillion, Yar’Adua was deeply hurt. The nation’s lawmakers had abused their powers by further enriching themselves at the expense of the nation. And at a time the economy is gasping for breath.  Though the crisis was managed, the sore point was a provision that upped a special-but- undesignated-quarterly allowance of each of the nation’s 109 senators from N45 million to N65 million. Every legislator in the 360-member House of Representatives too had cause to beam with easy smiles having been voted to enjoy an increment in this enrichment allowance from N27 million to N45 million per quarter. With this allowance alone, which is just one of several variants each lawmaker enjoys, a gaping hole has been dug into the treasury in the current fiscal year, running up to a whopping N93.140 billion. This amount, to Yar’Adua, contravenes the national economic mood, which is now one of gloom and uncertainty, increasingly spewed by the grinding fallout of the global economic meltdown.

Prior to the budget-passage ritual, the President, after much dithering, had led calls for a reduction in the salaries and emoluments of public functionaries, from the federal level down to the third tier of government. Perhaps, buoyed by the example of Governor Gbenga Daniel who had earlier called for a 12.5 per cent pay cut for public officials in Ogun State, Yar’Adua recommended to the Revenue Mobilisation Allocation and Fiscal Commission, RMAFC, that the remunerations of all public officials be drastically slashed in deference to the bleeding economic realities. The president cited as reasons the plummeting revenue accruing from crude oil export and the mini civil war in the Niger Delta, which had crippled oil exploration activities in the creeks. As at that time, a staggering N1.13 trillion, being the annual wage bill incurred on public officials, amounted to 37 per cent---slightly more than one third of the N3.1 trillion the executive initially proposed for the current fiscal year. Should this figure be computed with the bourgeoning salaries and allowances of civil servants, experts concluded that a whopping 88 per cent of the nation’s annual revenue would be needed as recurrent expenditure to oil the machinery of government, leaving a paltry 12 per cent to spend on capital projects required to catapult the nation’s economy from the doldrums to prosperity.

 

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