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Budget 2012 – Transformation or Retrogression?
2011 December 15 by Nasir El-Rufai
[pic][pic][pic]Let me start by apologizing for the inevitable absence of this column in the past two weeks; just as I would also like to express sincere gratitude to all those that visited, called or sent condolence messages to my family for our bereavement.
Moving on to the subject of this discourse, in the light of the passionate debate on the removal of fuel subsidy with which the country has been bedeviled in previous couple of months; the issue of whether the 2012 Appropriation Bill is a budget of fiscal consolidation or retrogression is as timely as it is topical. Transformation is a huge word that the Jonathan administration thoughtlessly uses to describe its aspirations. Is there anything transformational about the 2012 Budget proposals?
In the course of presenting the Draft Budget, President Jonathan in paragraph 1 of 81 of his address states “this budget is a stepping stone to the transformation of our economy and country in our walk to economic freedom” and concludes in paragraph 76 thereof that “Mr. Senate President……the Proposal I lay before you this day seeks to sustain sound micro-economic growth that will translate to achieving socio-economic transformation, and gainful employment for our people”.
Meanwhile, and perhaps by divine providence, in the afternoon of the same Tuesday, 13th of December; the News Agency of Nigeria (NAN) reported that Nigeria’s biggest power generating plant, Egbin thermal station, with an available capacity of some 1,080MW out of the nation’s meagre total of about 4000MW has been shut down on account of poor maintenance!
Thus, whilst the President was preaching a sermon of transformation in the National Assembly, Nigerians were simultaneously experiencing practical retrogression. Worse still, the raging debate on the removal of fuel subsidy to which the President was reported last weekend to have said he would “rather confront mass revolt than keep the subsidy” raised its ugly head by way of deaf silence with which the issue was foreclosed as not a single kobo was provided for subsidy in the so-called budget of transformation; just as not a single word on the subject was included in the 81-paragraph Proposal. Is this transformation or retrogression?
In order to fully answer the question, we shall focus for now on just four elements of the budget – Recurrent Expenditure, Power Supply, Security and Job Creation. This will enable us to have a meaningful dialogue on whether the country is making progress (let alone transformation) from the advent of the YarAdua/Jonathan administration in 2007 up to the 2012 Budget Proposal.
RECURRENT EXPENDITURE:
In the 2007 budget, spending on capital investments was dramatically increased from N567 billion in 2006 to N830billion, representing a year-on-year increase of 46%; whilst total recurrent expenditure accounted for 64% of the total budget. Since then, the annual budget has made a quantum leap of 107% from N2.3 trillion to N4.75 trillion. Concurrently, the capital element grew from by slightly less than 60 percent to N1.3 trillion, whilst recurrent expenditure has ballooned by over 133% from N1.47 trillion to N3.4 trillion, thereby outgrowing the pace of the total budget by over 25%.
Although President Jonathan understands the critical importance of putting a cap on government spending when he states in his 2012 Budget address that “this underscores the need to intensify our efforts to curtail recurrent expenditure, which we have already embarked upon under the policy of fiscal consolidation as evident from the Medium Term Fiscal Framework. The share of recurrent expenditure in the 2012 Budget proposal is 72% down from 74.4% in 2011, and we intend to continue in this downward trend”; the statement is at best a half-truth if only because recurrent expenditure nonetheless went up by a staggering sum of N91 billion between 2011 and 2012.
In the circumstance, Nigerians are still saddled with a bloated administration where over 70k out of every Naira of the near N5 trillion revenue is spent on running the government; consumed by about 1 million people that work for the Federal Government, whilst the same administration is imposing a punitive tax of N8,00 on every man, woman and child by unilaterally ‘withdrawing fuel subsidy’ The government has dared the people to put up or shut up. Would it not have been transformational for the size of the government and the waste and corruption of its officials to have been reduced as opposed to eliminating any subsidy?
POWER SUPPLY:
As alluded to previously, Egbin power plant has been shut down, meaning we now generate less than 3,000MW for a population in excess of 160 million. This means that power generation for each Nigerian is less than 20 watts of electricity whilst a Ghanaian enjoys about 4 times at 88 watts; a Brazilian enjoys almost 25 times at over 500 watts; a South African enjoys over 50 times at about 1,093 watts not to talk of an American at about 150 times at 3,252 watts of power generation!
In the “Road Map for Power Sector Reform” that was launched in August 2010 by President Jonathan, it was started that “the medium-term expectation is that 14,000MW of Power generation capacity would be available by December 2013″. The additional 10,000MW Power that must be generated for this target to be accomplished would cost about $10 billion. Even if we assume that the Independent Power Plants (IPPs) and other power plants under construction would add about 5,000MW to the existing pool, there exist nonetheless a shortfall of 5,000MW that will cost $5 billion, whilst only N161billion – a little over $1 billion is the total earmarked for recurrent and capital spending of the power sector in the 2012 budget. Where is the transformation?
Clearly, in the unlikely event that we are able to appropriate $4billion in the 2013 budget for Power sector; we will still not be able to meet the said target if only on account of the gestation period of a couple of years that is required for power plants to be built. Here again, the concept of transformation is more of a wishful thinking rather than a realistic prospect.
SECURITY:
Security has become our primary challenge as a nation, and the budget proposal loudly earmarked N922 billion for the sector. Compared to infrastructure (N774 billion)and Human Capital (N714 billion), it looks sizeable. What is not apparent to many people is that the amount proposed is about N250 billion LOWER than the N1,174 billion budgeted to cater for the capital and recurrent needs of our for armed forces, police, the NSA, amnesty programme and the para-military agencies that make up our security sector. Today, our civil intelligence and security system has collapsed with the administration having to deploy the Nigerian Army in active, but totally inappropriate combat duties in 34 out of 36 states and the FCT. Our Army has never been so deployed in as many states even during the civil war!
And the spending of over N1.1 trillion on “security”, about 26% of the 2011 budget has brought nothing but greater insecurity, needless deaths and destruction of property of Nigerians. What has happened to our internal security is certainly retrogression, not transformation, and proof of a totally inept and dysfunctional governance!
JOB CREATION:
The only tangible element of direct intervention by the Federal Government to create jobs was the N50billion that was set aside in the 2011 Appropriation Act for the Youth Enterprise With Innovation in Nigeria (YOUWIN) program. The program was to provide a one-time equity grant for 1,200 selected aspiring entrepreneurs to start or expand their business initiatives and generate about 100,000 new jobs over a 3 year cycle.
Although the program was launched with a lot of fanfare by the President in October of this year, every available information so far reveals that not a single job has been created even though the year 2011 is coming to an end. This issue of non-implementation typifies the majority of the new initiatives and capital projects that were contained in the 2011 Appropriation Act. Worse still, the YOUWin program, as designed, is flawed with many defects as it is in totality a drop in the ocean, given that in the most optimistic scenario, only 100,000 jobs will be generated in 3 years for the teeming unemployed Nigerian youths of at least 25 million.
One of the major flaws of YouWin is that the so-called 1,200 young entrepreneurs will receive “an equity grant” that is tantamount to a government largesse or gift without any pre-identified objective criteria for selecting the winners and sustaining the program without new capital contribution by the government. Thus, far from transforming the previous PDP government-led largesse known as National Poverty Eradication Programme (NAPEP); the Jonathan administration has simply replaced one dubious scheme with another; with some arguing that the YOUWin programme is worse than the NAPEP because some of the projects under NAPEP such as the Keke NAPEP are visible for all to see whereas beneficiaries of the YOUWin programme will have limited identity, with little or nothing to show for their jackpot.
In closing, the four areas of Recurrent Expenditure, Power Supply, Security and Job Creation elements of the 2012 Appropriation Bill analyzed above provide answer to the question as to whether the 2012 Budget is that of Transformation or Retrogression. You be the Judge!
FIXiNG THE 2011 BUDGET:
Can this retrogressive budget be fixed? Of course.
It is a proposal which only becomes law when enacted by the National Assembly. As suggested on Twitter by my brother Bashir Yusuf Ibrahim, we must all rise up and call our representatives and senators to transform the proposal into a sensible, fiscally-sustainable budget by effecting the following amendments: (1) reduce the oil production assumptions to a more achievable 2.35 million bpd, and transferring all excess earnings to the sovereign wealth fund (2) raise the benchmark oil price to $75 per barrel, and include the increased revenue as a line item to subsidize the selling prices of kerosine and petrol in 2012(3) reduce recurrent budget proposals of all MDAs including the Presidency, the National Assembly and INEC by at least 30% and transfer the savings to the capital components of infrastructure, civil security and human capital sectors, 4) raise import duties of agricultural commodities that we can produce domestically to levels that existed in 2007 to encourage our farmers, and (5) include a line item in the budget for a national price support system in lieu of fertilizer and other dodgy subsidies in agriculture.
The ball is now in the court of our legislators to be on the side of the ordinary Nigerian, and save President Jonathan from the anti-democratic path he has chosen to tread. He may be prepared to face a popular revolt, but only God knows how that will end. Avoiding it by doing what is fair, just and reasonable in the circumstances is what pragmatic leadership is about. We are waiting and watching. from → Economy
22 Responsesleave one → 1. [pic] harold olamilokun permalink December 16, 2011 Very well analyzed, there wouldn’t be much need for me to tear up the budget any further. However, in as much as i really appreciate your efforts to be objective and less judgemental, i still feel the truth stares at us right in the face. 1. Though the 2011 polls produced new diverse faces in the National Assembly, it is still safe to say that it is business as usual, as the newbies have either been indoctrinated or have started to exhibit their “Nigerian: Me, Myself and I” characteristics. this makes it nearly impossible for them to care about anything in the budget (that is if they heard or read anything when 60% must have been sleeping and waiting for “I and NE”) 2. The budget as you rightly pointed out sir, typifies the ineptitude of these men, so i am not surprised. It clearly exhibits true purposeless agendas of this administration further reveals itself as a LOUD MOUTHED but MUTED CEREBRAL government. At this point i must also point out that i am still expecting a “budget-annex” to identify the 36 new Airports and 36 new Federal institutions.. someone thoughtlessly boasted about…. 3. Security???? i laugh! For someone who comes from a sound military background. All i can say is “Clueless Mortals”. If not that the military is less concerned about what democrats do with “their country” or that most of them have also rained in the relaxed and “me, myself and i” mentality, i would have boldly said that the budget and other related security actions just set us up NICELY for A Military C*** Oh are you guessing ? its COUP (yes i said it) We are fighting wars against ourselves? When Some people are preparing for WW3. 4. Power? oh you mean the stuff that comes on and cant turn on my florescent or my fridge oh… Nice! 4000mw .. interesting Now i believed that Governance is synonymous to Lies. The truth is the we could always have gotten to 4000 from our 2500+ but it was safer to remain there cause of the Nigerian Cancerworm of corruption, the event at Egbin would always be inevitable. 5. Mindless youths! just cajole them some more with N50b, do some more facebook and twitter stunt, sponsors more purposeless “talent or handout” shows… so they dont Wake up from their slumber… while u allocate the funds to the names i will you and then EAT the rest. Sir, you are being very generous when you stated 100,000 jobs. for where???!!! There are alot of things better left unsaid about the Ruling party and its Pilot. Like i always said GEJ would have been a man of Honor if he didn’t contest in April. He would have been so respected by all as a “Great” man, as we would not have been privileged to see his exhibition of ineptitude and tactless leadership. twitter @hardrold 2. [pic] G. Stanley Okoye, M.D., Ph.D. permalink December 17, 2011 Mallam Nasir El-Rufai, my sincere condolence for the lost of your daughter, Yasmin. I enjoy your objective and brilliant socio-economic and political analysis. You’re a special Nigerian. The eye glasses is save and still looks brand new – my apologizes, I had no way of contacting you. 3. [pic] Aliyu Yunusa permalink December 18, 2011 Sir i really educate about budget that propose by GEJ goverment. But your solution to contact the legislation is almost mission impossible because most of them are not coming home. Even if they arrive ,they just encircle themselve with yes sir people . And any jack and harry want to get a kitchen change from them. 4. [pic] James J. Kolo permalink December 18, 2011 Corruption is killing the country and its worst now. With amnesty oil boom we should be better but worst 5. [pic] Auwal Anwar permalink December 18, 2011 This is a brilliant, informative contribution. What is more remarkable is your ability to rise above the personal grief that must have enveloped you and to contribute to National Discourse, with clarity and purpose, at an obviously difficult time. I remember when for military president’s wife passed away, he (conveniently?) avoided some pressing national issues that required his intervention. May Allah continue to help and support you and your likes. And please accept our condolence once again. 6. [pic] Auwal Anwar permalink December 18, 2011 … when a former military president’s… 7. [pic] Gbenga fakoya permalink December 18, 2011 Very retrogressive budget! Time will tell Sir. 8. [pic] dubem permalink December 19, 2011 Mallam,whats the purpose of ur ill-intend analysis? To cause disaffection among the people and their leaders. Every discerning Nigerian knows what you are out to achieve but the almighty God will not allow you and ur likes to have ur way. Critizing every act of the Govt is not a patriotic act considering your history. Get used to a Niger Deltan being the president of Nigeria. 9. [pic] uju permalink December 19, 2011 Good analysis sir but don’t forget to also inform us when government is getting it right. 10. [pic] Kelvin Ebiri permalink December 19, 2011 Sir, do accept my heartfelt condolence. I pray God to continually grant you the fortitude to bear the exit of your beloved daughter. I earnestly pray that the National Assembly should drastically readjust the 2012 budget. 11. [pic] Alia permalink December 19, 2011 Mallam, walahi we’re waiting. Nigerians should know by now that what we have is worst than a military regime, our democracy as run by Jonathan and his cohorts in pdp and their private sector collaborators are not the messiahs that we’ve been waiting for. Nigerians are in trouble because this group will stop at nothing to appropriate more money for stealing, even at the cost of a revolt. We’re waiting ………… 12. [pic] fareed permalink December 19, 2011 kudos el rufa’i..to conclude, GEJ is not just competant enough to rule this nation. 13. [pic] labubu permalink December 19, 2011 Don’t you think the 1.1trillion voted for security is part of the budget for quelling the pro subsidy riots, It shall be well with Nigeria. 14. [pic] Muhd sani permalink December 20, 2011 Good analysis. But i wonder y CBN boss and finance minister, support oil subsidy removal? Pls sir, we need more analysis on this issue because its really complicate many nigerians. 15. [pic] Siyaka Ogido Bashiru permalink December 21, 2011 Bashir Ogido Accept my condolence sir. The problem we have in this country is that people like you are very few in the country at the moment.May you live long. 16. [pic] Basheer Gololo permalink December 22, 2011 Business as usual, the breakdown of 2012 budget is more disturbing than anything i have seen so far…….Carry on Elrufai, we stand by you 17. [pic] Barr. Ismail Ahmed Kano permalink December 24, 2011 As a bonafide member of the CPC and also a member of the renewal committee under your able chairmanship, I am exceptionally proud of your constant contribution to our national discourse and your valuable insight in dissecting our artificially grown national complications. However from this write-up of yours sir, I can see you also support the creation of the Sovereign Wealth Fund (which I am yet to fully grasp) as one of the depositories of government for future uses right? Pls sir, I want to understand what is the clear difference both in operational mechanisms and framework, between an SWF and foreign reserves which is still mismanaged at will by the federal government? What is the guarantee that it will not be depleted by either corruption, mismanagement or a global financial melt down? Thank you sir 18. [pic] Ahmed permalink January 5, 2012 Salam, Am one of those who have been blindfolded before now that you are only proclaiming “a holier than thou attitude” adjudging from the demolishion/sales of land in FCT & BPE. Moreso, that you decided to pitch tent with my mentor(Gen. Buhari) because you have been scheme out in the power equation of PDP. Please do pardon me for my sense of judgement cos recent events have vindicated you. Permitt me to use this opportunity to condole you, your well-wishers & relatives over the Demise of your Daughter. May Allah (SWT) forgive her shortcomings & grant her Aljanat-firdaus. Please don’t relent in your struggle cos we the younger generation are looking up to people like you. Maasalam 19. [pic] Chika permalink January 6, 2012 Sir, I do really appreciate you, and your concernfor this nation. I have always supported you, even when you were modernising FCT and even demolished my brother’s house. People like you are supposed to pilot the affairs of this nation. I even appreciated you more when you aligned with my mentor, Buhari to save this nation from collapse. Unfortunately, people were too short-sighted not to see where GEJ may likely lead us to. I strongly analysed his one year leadership before the election, and concluded that he has no clue. let us keep praying for this nation, and also be prepared for an inevitable revolution. It MUST surely come, especially now that subsidy is removed. Please keep educating the populace and keep the fight on. I am strongly by your side. We shall deliver this nation from the hands of these blood sucking demons. Remain blessed. Yesmine, your daughter is surely in God’s paradise, asking God to give you the strength to fight on. I sincerely condole you for the earthly loss. Remain strong. 20. [pic] Adam idris permalink January 14, 2012 @dubem you are the sort of folks who opt for parochialism, ethnicity e.t.c to the detriment of the objective and biase free truth. everyone in nigeria today knows the kind of (seemingly, and unavoidable to say) rudderless, inept, insensitive, and tactless helmsmanship that we have at the top. it would be only honourable for, GEJ to step aside and allow more qualified personce the chance come 2011. otherwise… GOD HELP US. 21. [pic] emmanuel theo permalink January 16, 2012 What baffles me is why so many Nigerians are allergic to the truth, we must not forget that it’s only this truth that can set us free. Thanks Mr. El-rufai for this new part u have chosen, we pray for your likes to be touched by God to help us in the struggle for true Democracy. @Dubem, wake up from your slumber or maybe u are not even in/a Nigerian, ok……….. A parasite of the worthless govt in question. God has already blessed us with all we need to be USA, whatever is left in definitely in our own hands… God protect Nigeria! 22. [pic] Holubukola Omooba permalink January 17, 2012 Mallam,whats the purpose of ur ill-intend analysis? To cause disaffection among the people and their leaders. Every discerning Nigerian knows what you are out to achieve but the almighty God will not allow you and ur likes to have ur way. Critizing every act of the Govt is not a patriotic act considering your history. Get used to a Niger Deltan being the president of Nigeria. @Dubem, U warm my heart with this. God bless u cos it is well said. I can’t add more. U said it all.
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...A compound word is made when two words are joined to form a new word. Definition In English, words, particularly adjectives and nouns, are combined into compound structures in a variety of ways. And once they are formed, they sometimes metamorphose over time. A common pattern is that two words — fire fly, say — will be joined by a hyphen for a time — fire-fly — and then be joined into one word — firefly. In this respect, a language like German, in which words are happily and immediately linked one to the other, might seem to have an advantage. There is only one sure way to know how to spell compounds in English: use an authoritative dictionary. There are three forms of compound words: the closed form, in which the words are melded together, such as firefly, secondhand, softball, childlike, crosstown, redhead, keyboard, makeup, notebook; the hyphenated form, such as daughter-in-law, master-at-arms, over-the-counter, six-pack, six-year-old, mass-produced; and the open form, such as post office, real estate, middle class, full moon, half sister, attorney general. How a word modified by an adjective — "a little school," "the yellow butter" — is different from a compound word — " a high school," "thepeanut butter" — is a nice and philosophical question. It clearly has something to do with the degree to which the preceding word changes the essential character of the noun, the degree to which the modifier and the noun are inseparable. If you were diagramming a sentence with a...

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Transitions: Words & Phrases

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Journey to the World of Words

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The Word Children Research Paper

...There are a lot of words that come to mind when someone says the word “children”. Some people can narrow it down to a few words and some people could fill up a whole paper with words. The reason is this is because of the different views that people have on children or their past experiences. The first word that comes to mind when I think of the word “children” is the word innocent. The reason why I think of the word “innocent” is because when someone is innocent they are without corruptness of the world and they don’t have any impurities. They are simply someone who hasn’t been influenced by anyone or anything in a negative way. The next word that comes to mind is fun. Most of my experiences when I am around children are fun and exciting. For...

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Parallel Words In American Culture

...The root of why the slang words are created and seem to grow in popularity instantly and, sometimes, die off just as quickly is something that has been studied but a complete explanation for the process is yet to exist. There are many reasons, such as music, politics, and technology that create new slang terms and explain their growth. To analyze some of the reasons why and how specific slang words have appeared and disappeared in American culture throughout the last sixty years, I will interview a person from another generation about their experiences with slang in their time and compare it to my own experience of slang in today’s society. To understand the evolution of slang I interviewed my boyfriend’s dad, Bruce. I interviewed Bruce over...

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Words Mean What They Mean

...Kacie Kondrotis Professor Goodwin 9/15/14 Words Don’t Mean What They Mean Steven Pinker, a psychology professor at Harvard University, is the author of “Words Don’t Mean What They Mean”. He argues that there are many categories in which people transfer information and progress to settle that relation. He expresses that phrases convey meanings in the context being used and how this can help or decrease communication between humans. Pinker declares that our language is used through many different variations. From “sexual come-ons”(p.113), which note the phrase “would you like to come up and see my etchings?”(p.113) to the veiled threat that is told within a certain set of words. Pinker declares a veiled threat as if a “Mafia”(p.113) guy wants to offer protection and says, “nice store you got there. Would be a real shame if something happened to it.”(p.113) Which then leads Pinker to discuss the reality of “why don’t people just say what they mean?”(p.113) His discussions sum up to the fact that when humans speak to each other it’s because we have some sort of familiarity with them and each sentence you speak “conveys a message and continues to negotiate that relationship”(p.113). Pinker describes it most similar to “ordinary politeness”(p.113) or more clearly written as when we want the salt at dinner. If you want to seem rational and polite you would say “gimme the salt”(p.113), humans change the language to, as Pinker calls it, a “wimperative”(p.113) that creates...

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