Tuesday, July 16, 2013

AL-MUSTAPHA: FG URGED TO PAY BENEFITS

Former lawmaker in the Imo State House of Assembly, Steve Orji, has urged the Federal Government to restore all the entitlements due Major Hamza Al-Mustapha, having been discharged and acquitted by the Court of Appeal.

Briefing newsmen in Owerri yesterday, the national coordinator Voice of the People, also called for upgrade in his military rank, while all his property earlier seized be released to him.
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2015: S-West PDP to mobilize traditional rulers for Jonathan

ABUJA -THE leadership of the Peoples Democratic Party, PDP, in the South West has promised to enlist the services of the traditional rulers in the zone to ensure that President Goodluck Jonathan is re-elected in the 2015 Presidential election.

National Secretary of the party, Prof. Wale Oladipo who disclosed this while reaffirming his support for President Jonathan`s second term endorsement said, “I stand by the endorsement of the president by South West chapter of the party.”

Prof. Oladipo further stated that as a prince of Ife, he would mobilize royal fathers and the intellectual community from the South West zone for the realization of the second term ambition of President Jonathan.

Apart from his endorsement of the president’s re-election, he also promised to be loyal to and work with the party’s national chairman, Alhaji Bamanga Tukur in a bid to make members of the PDP to see themselves as members of a political family.

The nuclear physicist who said that he remained resolutely committed to the president`s second term re-election in 2015, described Jonathan as a democrat who deserved the support of all well-meaning Nigerians.

He said, “I stand by the endorsement of the president by South West chapter of the party and as a prince of Ife,I will mobilize royal fathers and the intellectual community for the second term election of the president.”

While commending the president for the enabling environment given to the South West to anoint a new national secretary, prof Oladipo also restated his loyalty to Alhaji Tukur who he said was a father figure in the administration of the party.

“Aside my unflinching loyalty to President Jonathan, I also pledge to work harmoniously with the party chairman without rancor or disharmony. I will act like the administrative head implementing decisions of the party leaders and that of the leader of the party, President Jonathan,” he declared.

The PDP national scribe promised to abide by court ruling on party issues and also commended contestants who either stepped down for him or had extended their support, assuring that he would not disappoint them.

He said, “Our appreciation goes to the national leaders of the party who allowed the position to remain in Osun. I will do my best to ensure the repositioning of the party for victory in all elections.”

Meanwhile, the poster of President Goodluck Jonathan and that of the former Head of State and Chieftain of the Congress for Progressive Change, CPC, General Muhammadu Buhari have resurfaced in Abuja, the Federal Capital Territory.

Vanguard investigations revealed that the posters which are pasted in some sensitive areas in Abuja were struggling for space as some of them were pasted side-by-side, but no group had openly claimed to be behind the re-appearance of the posters.

As Jonathan’s posters in a Yoruba traditional attire has the logo of the Peoples Democratic Party, Gen. Buhari appeared on the background of the All Progressives Congress, APC, the merging party that is begging for registration by the Independent National Electoral Commission, INEC.

Al-Mustapha: Rights group calls for probe of prosecutors

The Human Rights Writers Association of Nigeria (HURIWA), has called on the National Judicial Council (NJC) to probe the prosecutors who handled Maj. Hamza Al-Mustapha’s case.

The call is contained in a statement issued on Monday in Abuja and jointly signed by the National Coordinator of the association, Mr Emmanuel Onwubiko, and the National Media Affairs Director, Miss Zainab Yusuf.

Al-Mustapha, a former Chief Security Officer to the late Head of State, Gen. Sani Abacha, was sentenced to death on Jan. 30 last year over the murder of Kudirat Abiola on June 4, 1996 in Lagos.

Kudirat was the wife of the presumed winner of the 1993 presidential election, Chief MKO Abiola, who died on July 7, 1998.

Al-Mustapha was on Friday released from the Kirikiri Maximum Prisons, Lagos, following his discharge and acquittal of a murder charge by the Court of Appeal in Lagos.

He was set free along with Mr Lateef Shofolahan, an aide to Kudirat.

The statement said the investigation should determine whether the prosecution team compromised the trial of Al-Mustapha and Sofolahan.

“The earlier judgment may have resulted in the eventual alleged miscarriage of justice by the appellate court in Lagos.

“It is the belief of the rights group that government and the hierarchy of the nation’s judiciary cannot afford to overlook the ground swell of allegations of professional misconduct,” the group said.

The statement urged the Lagos State Judiciary to consider the overall public interest before deciding whether or not to institute an appeal before the Supreme Court to challenge the outcome of the appellate court.

It, however, stressed the need for the State Government to collaborate with the Federal Government to work out and implement “transparent civil financial compensation package for the family of the late Kudirat.

HURIWA said that the fact that the Appeal Court had freed Al-Mustapha, did not mean that Kudirat was not killed by “alleged state -sponsored killer squad.

“We in the human rights community have the greatest respect for the integrity of the nation’s judiciary.

“We are also very conscious of the fact that as an institution run by human beings who are imperfect, there are possibilities of compromise and other attributes of corruption and bribery.“ (NAN)

Nigerian jet for Malawian President

Malawi’s President, Joyce Banda

WHEN Nigeria dispatched a jet from its Presidential Air Fleet late last month to fetch Malawi’s President, Joyce Banda, to Abuja, it unwittingly drew attention to our government’s fiscal recklessness. It was lost on President Goodluck Jonathan that while Banda had sold her cash-strapped country’s only presidential jet to save costs, he has, in three years in office, expanded Nigeria’s executive fleet to 10 aircraft.

Neither the reality of over 60 per cent of the population living in poverty, nor the recent alarming revelation by the Finance Minister, Ngozi Okonjo-Iweala, that government’s revenue inflow had dwindled to a dangerous level, has persuaded Jonathan to pare down the size of the Presidential Air Fleet. Instead, it is projected to rise as provision has reportedly been made to purchase two additional helicopters to ensure the President, Vice-President, their families, and other top functionaries travel in luxury at public expense.

Banda was in Nigeria to deliver the keynote address at the Global Power Women Network Africa summit in Abuja at the invitation of Nigeria’s First Lady. To ease her trip to Nigeria’s capital, our generous government dispatched a jet to pick her from Lilongwe, Malawi’s capital, and return her home after the event. That is to be expected since Malawi lacks a presidential aircraft.

Shortly after assuming the presidency in 2012, Banda had taken a critical look at her country’s economy. Almost 40 per cent of the national budget came from aid donors, while revenues from its major exports – tobacco, tea, coffee and sugar – were falling due to lower global demand and prices. Moreover, the International Monetary Fund and the World Bank had withdrawn most aid in response to the purchase in 2009 of a presidential jet by Banda’s predecessor, Bingu wa Mutharika, and his abandonment of an IMF-dictated adjustment programme. Other donors followed the World Bank/IMF lead.

Besides selling the presidential plane for $15 million, Banda also sold off a fleet of 35 Mercedes Benz limousines reserved for the president and the cabinet. She cut her own salary by 30 per cent, among other austerity measures. Her actions won praise around the world and convinced the IMF and other aid donors to return with credit and handouts to back the government’s ongoing painful structural adjustment programme.

But Nigerian leaders will not sacrifice their own comfort for anything. Even in a rich country like Britain, Prime Minister David Cameron and cabinet members took pay cuts in response to the global recession and the spending cuts that the government introduced. Here, our leaders are obsessed with living in luxury, regardless of the mass of people who are poor, the lack of infrastructure, mass unemployment and dwindling revenues. Okonjo-Iweala’s warning that the government may run out of money to pay salaries by October in the face of massive oil theft and vandalism of pipelines that have sharply reduced oil production and revenues has not jolted officials. Neither the wasteful Executive nor the overpaid legislators are ready to give up their luxurious lifestyles.

But British leaders often take commercial flights and, occasionally, trains when travelling for state functions. Japan, with its Gross Domestic Product of $4.52 trillion and per capita income of $36,200, (at Purchasing Power Parity), has only two aircraft – Boeing 747 – 400 – for use of the prime minister and the emperor; the Netherlands, with GDP of $770.2 billion and PCI of $42,300, has two; the British Queen, Elizabeth II, and Cameron travel on chartered British Airways flights, despite their country’s $2.32 trillion GDP and PCI of $38,700; South Africa has just one presidential aircraft with its GDP of $678.6 billion and PCI of $11,300, though it expects another soon, while Malaysia has one, but has also ordered a second; but with its GDP of $492 billion and PCI of $16,900, like others cited, Malaysia is ahead of Nigeria with a GDP of $450.5 billion and PCI of $2,700.

Given these scenarios, it is high time we ended this absurdity. Today, the aviation sector is in dire straits. How does one explain that only two domestic airlines – Arik, with 23 planes, and Aero Contractors with 14 – have larger fleets than this one kept for a few at public expense? Over N9 billion is believed to be spent on the maintenance of the presidential fleet each year, while the PAF required 47 Nigerian Air Force officers, 173 airmen/airwomen and 96 civilian employees on full time call in 2012.

Nigerians, however, desperately need a government that exists to serve the people, not a few. Successive governments have demonstrated incompetence and abused and misused public funds. There should be minimum ethical standards and decorum in public office. Other developing nations like Ghana where a former president, John Kufuor, once disposed of a spare presidential aircraft, retaining only one, should shame us into prudent conduct.

Jonathan has no excuse to continue keeping 10 aircraft and our under-performing legislators have no reason to keep approving new purchases or the billions of naira they appropriate for their maintenance each year. But, ultimately, it is only when the electorate shakes off its lethargy and demands accountability and responsibility from public officials that things will change for the better.

Strike: ASUU insists FG implements 2009 agreements

The Academic Staff Union of Universities (ASUU) on Monday insisted that the Federal Government should implement the agreements reached in 2009 before it would call off its strike.

ASUU made its position known in Abuja when it appeared before the joint National Assembly Committees on Education.

The News Agency of Nigeria (NAN) reports that some of the issues in the agreement include: funding, university autonomy, academic freedom, earned academic allowance and registration of Universities Pension Management Company.

protest: students protesting against ongoing nationwide strike, on Ikorodu Road, Lagos, yesterday.

Other are: amendment of pension retirement age of academics at the professional cadre, federal assistance to state universities and transfer of Federal Government landed property to universities.

Chairman of ASUU, Dr Nasir Fagge, told the committee that only two out of the nine agreements had been met.

“We cannot renegotiate what was already agreed in 2009, so the best thing is, let government go and implement the aspects of the agreement as they have proposed to us themselves.

“Once that is done, I am confident that it will engender confidence among our members and our members nationwide will be able to review the situation at any moment and take appropriate decision.’’

Fagge expressed worry that the Federal Government was not fair in its dealing with the association.

He decried the situation whereby funds were being pumped into other sectors such as banking, aviation and textile industry that had challenges, yet education was continuously being neglected.

“If we really want to turn around the country, we must address the issue of education because it is the bedrock of development.

“I believe that one of the ways of addressing some of these issues is for government to implement the 2009 agreement as this will place education on a sound footing.’’

He noted that Nigerian students and lecturers were continuously leaving the country to neighbouring countries in search of better education and teaching conditions.

Speaking on the issue, Minister of Education, Prof. Ruqayyatu Rufai, told the committee that the Federal Government was working tirelessly to ensure that it met its own side of the agreement.

Rufai said the implementation of the agreement was not something that could be completed within a short period as it required a very long and tedious process.

“Two of the issues have been implemented up to 100 per cent and the other issues too, progress has been made as there has been an increase in funding.’’

Also speaking, Prof. Julius Okogie, Executive Secretary, National Universities Commission (NUC), told the committee that the tuition paid in universities in Nigeria was very low compared to other countries.

Okogie appealed to ASUU to call off the strike since negotiations were already on.

Some members of the committee including Sen. Oluremi Tinubu (ACN-Lagos) and Rep. Farouk Lawan (PDP-Kano), also appealed to ASUU to soften its stand and call off the strike in the interest of the students.

NAN reports that the committee later went into a closed session with the stakeholders. (NAN).

PDP crisis festers as Tukur stops Gana panel

PDP National Chairman, Dr. Bamanga Tukur
| credits: File copy

The crisis rocking the Peoples Democratic Party took a new turn on Monday with the party’s National Chairman, Dr. Bamanga Tukur, asking members of the National Convention Committee headed by Prof. Jerry Gana to stay action on the plan.

The decision to suspend the action of the committee, which had earlier fixed the national convention for August 31, was taken at an emergency meeting of the National Working Committee of the PDP in Abuja.

A statement by the Acting National Publicity Secretary of the party, Mr. Tony Okeke, said the NWC took the decision to avert a constitutional crisis.

Okeke also said the South-West congress scheduled for August 24, would also not hold.

Gana, in company with the Secretary of the committee and the Deputy Senate President, Ike Ekweremadu, had said on Friday that the two dates(August 24 and 31) were sacrosanct.

But Okeke, in his statement, said some of the committee’s actions were in breach of the PDP constitution.

The statement reads in part, “The NWC, at its meeting on Monday, July 1, 2013 thoroughly considered issues surrounding recent developments in the party and resolved as follows:

“In view of the anomalies and breaches of the constitution of the PDP observed in the actions so far taken by the Special National Convention Planning Committee, the NWC has directed the committee to put on hold all activities relating to the Special South-West Zonal Congresses and the Special National Convention pending the regularisation of the anomalies and breaches so as to forestall a repeat of the events that affected the party’s convention in 2012.

“Consequently, the dates recently announced by the planning committee are in the circumstances untenable.”

Tukur has not hidden his disapproval of the activities of the committee since its inception.

For example, he refused to receive Gana and Ekweremadu when they attempted to see him (Tukur) in his house on Wednesday because of the way the committee was handling its assignment.

Our correspondent gathered that Tukur did not want majority of the former members of the NWC of the party, who resigned recently, to return.

Gana and Ekweremadu were said to have begun moves to return the formal NWC to the PDP using the convention of the party where new members of the NWC are to be elected.

Twenty officers of the party, some of whom were members of the NWC, resigned from their offices during the meeting of the National Executive Committee of the party on June 26 in Abuja.

Their resignation was as a result of a report by the Independent National Electoral Commission, which faulted the way the affected officers emerged at the May 24, 2012 national convention.

Tukur was said to have been happy with the resignation and had made up his mind that none of the affected officers would return as NWC members.

Apart from querying their loyalty, Tukur was said to have confided in his close associates that the former NWC members betrayed him because they did not share his vision in the running of the party.

For example, he was said to have expressed anger at the way all the NWC members, including the former National Secretary, Prince Olagunsoye Oyinlola, met and reversed a decision they jointly took on the state executive committee of the party in Adamawa State.

A close aide of Tukur said he was angry that some of the NWC members had penetrated the convention committee, thereby making it impossible for him (Tukur) to have his way in his determination to block their return.

The aide said, “The chairman wants a new NWC, because he has this notion that the last NWC members were not loyal to him and President Goodluck Jonathan.

“He, therefore, wants the committee to rezone the offices, which will make it impossible for the former occupiers of the offices to return. But rather than work in tandem with this arrangement, Ekweremadu and Gana went to the media, saying the former zoning formula would remain. That is the bone of contention.”

On Friday, Ekweremadu said that the zoning formula used during the “March 24, 2012 convention subsists,” but added that it would only be changed if it became absolutely necessary.

Apart from taking a decision on the convention, Okeke said the NWC at its meeting on Monday, also discussed the crisis rocking the party in Anambra State.

He said the PDP “has resolved to invite major stakeholders in the state to an enlarged stakeholders’ meeting on July 18 to commence consultations towards finding a lasting solution to the problems of the party in the state which will lead the party to a successful governorship primary election.”

Our correspondent gathered that the stakeholders, who are to be led by a former Vice-President, Dr. Alex Ekweme, would also meet with Jonathan a day before the meeting with the NWC members.

On the Rivers State crisis, Okeke said the NWC “also resolved to invite the National Vice-Chairman, South-South of the party, to brief it before it can take a decision that will lead to a prompt resolution of the crisis in the state.”

How to resolve the ASUU/Government conflict-

Like an anniversary celebration, this year’s edition of the annual closure of Nigerian Universities began on Tuesday July 01, 2013. As usual, no one knows when it will end. Indeed, the National President of the Academic Staff Union of Universities (ASUU) Dr Nasir Fagge says members of the Union are resolute that, only a complete resolution of the issues at stake would bring the current strike action to an end.

A sign that ASUU means business was shown last week in Abuja, when the Union walked out on the joint National Assembly Committee on Education at a meeting called by the lawmakers to intervene in the crisis. So, is ASUU rejecting dialogue? If so, is the Union not being insensitive to the plight of ordinary Nigerians who are adversely affected by the strike?

To answer any of these questions in the affirmative would be essentially simplistic. Because that ASUU is the aggrieved party that needs to be assuaged is not in doubt. Unfortunately, government posture does not sufficiently convey a conciliatory mood. In fact, government officials who have a mandate to resolve the crisis are yet to embrace the uncontroverted theory of old that the main aim of political communication is persuasion.

While the Education Ministry says an offer was made to the teachers to which they were yet to respond, the National Universities Commission (NUC) said it was unaware that the teachers were on strike. According to the NUC, “If they are on strike we don’t know. They should write to us”. These unconvincing statements cannot resolve the conflict because they are not credible-even the authors do not believe them.

A comparison of government position with that of parents is instructive here. The Minister of Interior, Abba Moro revealed last week that the Federal Executive Council examined the crisis and “expressed the concerns of the average Nigerians, stakeholders, parents and students and came to the conclusion that passionate appeal be made to ASUU to consider the overall interest of Nigerians in terms of the education of our children”.

He added that ASUU should “see the possibility of using a strike, which has become too incessant in recent times, as a last resort” Speaking on behalf of the National Parent Teacher Association of Nigeria (NAPTAN), its National Publicity Secretary, Chief Deolu Ogunbajo said that it was unfortunate that the government was reneging on an agreement it willingly entered into with the Union.

Ogunbajo insisted that what the lecturers were asking for was not “new and out of place’’. It therefore appears that to condemn ASUU for seemingly rejecting dialogue misses the point because its case is not a claim/request/ demand requiring dialogue but an agreement which requires implementation

Every intervention at this point should thus be well meaning and objective. In this regard, the National Assembly should not relent in its commendable efforts at resolving the crisis notwithstanding that ASUU worked out on its committee last week. First, our legislators should bear in mind that ASUU is aggrieved. Second, it should not see the decision of the teachers to walk out on it as a slight but a refusal of an aggrieved to be kept waiting.

Third, our legislators should remember that during the last strike, their own efforts were virtually thwarted by the halfhearted official handling of the matter. That only two issues — the review of the retirement age of professors from 65 to 70 and the reinstatement of prematurely dissolved governing councils — were the only ones implemented in a list of items of a four-year-old agreement suggests that we need to work towards a more sincere approach by all concerned.

Considering that President Jonathan is himself an academic, it seems strange that his team of Education Minister and NUC’s Executive Secretary who are also from that constituency are unable to win the confidence of their former colleagues. Could it be that the agreement with ASUU to which government initially committed itself in 2009 was later found to be unworkable like the famous ‘Aburi agreement’? If so, it is the body language of government that should change. One good way of doing this is to shun blackmail and explore the persuasive mobilization expertise of people like the legendary Jerry Gana who himself is now Chairman of a University Council.

Their work would be to let ASUU into the costs of unexpected emergencies like our unprecedented security challenges and the ravages of flooding. They should then seek to convert ASUU members to partners in progress by evolving a road map based on an agreed and sincere instalmental implementation of the other items in the 2009 agreement.

This would obviously be more persuasive than the present trend whereby some privileged persons in the corridors of power are as usual busy convincing government that ASUU members are charlatans as well as tools being used by the opposition to destabilize government.

University management teams must also change their approach to the crisis at hand. Many of them appear too comfortable to be bothered about ASUU feelings. At the Nnamdi Azikiwe University (UNIZIK), Awka, for instance, the authorities allegedly locked ASUU members out of the multi-purpose hall where they were to hold a scheduled meeting.

Some examinations were reportedly held in the School during the strike in line with what is called the Vice Chancellor’s ‘students first’ philosophy and policy. Who will mark, collate and grade those examinations? Such an approach which can antagonize ASUU is similar to that by which honorary degrees are often given to government officials known to be ‘unhelpful’ to the cause of ASUU

University managers can in earnest reduce the frustrations in their campuses. For example, every session, some universities admit over 200 students for courses for which available classrooms can hardly accommodate 50 students.

Painfully, what is collected yearly as internally generated revenue (IGR) makes little or no impact on the overcrowded facilities in our universities thus stamping into the sub-consciousness of a pressure group like ASUU, the inadequacies of the environment. It is submitted that a more judicious use of IGR is capable of putting some smiles on the faces of teachers and students in our universities.

CONSTITUTION: INEC TO GET POWERS TO CONDUCT REFERENDUM

Prof. Attahiru Jega

The Independent National Electoral Commission (INEC) might get powers to conduct national referendum in future constitutional amendments as the Senate prepares to vote on the report of its ad hoc committee on the review of the 1999 constitution today, Daily Trust can reveal.

The committee led by deputy senate president Ike Ekweremadu, had on June 5 submitted its report to the senate. Senators dedicated the whole of last week debating the proposed amendments and are billed to carry out clause by clause voting.
According to the 36 page recommendation made by the panel, clause 2 seeking to alter sections 8 and 9 of the extant Constitution provides that INEC shall be empowered to conduct national referendum on any future alterations of the constitution.
Item 3M, under clause 2 seeking to alter section 9 states that, “The Independent National Electoral Commission shall within 6 months of the receipt of the draft constitution, cause a referendum to be conducted to approve the draft constitution.”
Subsection 3N provides that: “If the draft constitution receives a simple majority of votes cast in two-thirds of all states of the Federation, it shall come into force as a Constitution of the Federal Republic of Nigeria.”
In the same vein, the Senators are also seeking to scrap both the Senate and House of Representatives ad hoc committees on constitution review in subsection 3D of section 9 by providing for a joint National Assembly constitution drafting committee which will comprise of two members from each of the 36 states of the Federation and the FCT, one Senator and one House member and will be set up by Senate President in consultation with Speaker of the House.
The joint committee according to the new proposal within three months of its constitution “shall produce a draft constitution which shall be submitted to the president of the senate and speaker of the House of Representatives.”
After the draft is submitted by the Commitee, members in each of the Houses will vote by two-thirds before it is transmitted to the 36 states Houses of Assembly who in turn will also vote by simple majority of two-thirds of their members on each item slated for alteration before returning it to the National Assembly after which it will then be forwarded to INEC for referendum.
INEC is asking the National Assembly to consider and give speedy effect to the proposals for Amendments to the 1999 Constitution (as amended) and the Electoral Act, 2010 (as amended) and is demanding far-reaching powers to be the sole authority on the disqualification of candidates as well as determine the political parties that would have their names and logos on the ballot papers as against the provisions of the Electoral Act, where INEC can only disqualify a candidate based on judicial orders
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N1.5TR DEBTS WEIGH DOWN STATES

Debt service gulps mouh of their monthly allocations

Despite assurances that the public debt stock is within manageable level, official data analysed by Daily Trust shows that many states lose large chunk of their statutory monthly allocations to debt service deductions, leaving small amounts for fresh projects.

Documents from the Debt Management Office and the Federal Ministry of Finance show that most of the 36 states are paying heavily for domestic and foreign debts that piled up over time, with some of them collecting just half of their monthly statutory allocations while the rest of it is held at source to settle debts.
For instance, Bayelsa State, which is the second biggest debtor with N167 billion, foregoes nearly all of its monthly statutory allocations, retaining only its own share of the 13 per cent derivation funds.cent derivation funds.
For the month of April, N2.37 billion was deducted from Bayelsa’s N2.54 billion statutory allocation. But for the N12 billion derivation funds it collected, the state would have left the Federation Account Allocation Committee (FAAC) meeting almost empty-handed.
Edo State’s debt service deduction for the month of March was N697 million out of its N2.9 billion statutory allocation. But it had N1.7 billion derivation fund to fall back on to.
Non-oil states are less fortunate in this regard, as after the debt deductions they have no plum derivation funds to augment their takings. Like the case of Lagos whose at-source deduction for the month of April was N1.5 billion, leaving it with N3 billion statutory allocation.
Based on the latest debt figures published by the DMO in December, the biggest debtors (domestic and external) are Lagos (N234 billion), Bayelsa (N167 billion), Cross River (N107 billion), Delta (N93 billion), FCT (N91 billion) and Rivers (N89 billion).
The biggest debtor states in the North is Kaduna (N63 billion), followed by Kogi (N39 billion), Kwara (N32 billion), Adamawa (N30.5 billion), Bauchi (N28 billion) and Plateau (N24 billion).
On the other hand, the three least indebted states in the country are Borno (N3.7 billion), Jigawa (N5.9 billion) and Yobe (N6.9 billion).
The domestic debts comprise commercial bank loans, state bonds, contractors’ arrears, arrears on pensions and gratuities, salary arrears, other staff claims and other liabilities including judgment debts.
A former presidential economic adviser Professor Osita Ogbu said Nigeria’s debt profile is becoming “odious”.
“Many of us are concerned about domestic borrowing and the rising stock. But we should worry about rising external borrowing too despite our current low foreign debt service to export or debt to GDP,” he said in a recent article published in Daily Trust.
“We should still worry for two reasons: our vulnerability due to over dependence on oil exports; and the policy dependence that ensues once you need external assistance to deal with your external debt obligations.”
A DMO document shows that the 36 states and FCT’s domestic and foreign debts are N1.572 trillion as of December 31, 2011, with the domestic component being N1.233 trillion (about 78.42 percent of the total) while foreign debt stock stood at N339 billion.
The DMO report, titled “Report on the Programme for the Establishment of Debt Management Departments and Domestic Debt Data Reconstruction in the 36 States of the Federation and the FCT,” was dated December 2012 and is the last such report published by the DMO.
Though the DMO said the states’ debts are still within the World Bank debts threshold sustainability ratio of 250 percent, the debts are apparently taking a toll on the states.
Even after this document was published, many states have taken additional loans, particularly external ones, further shaving off their net collectible monthly statutory allocations.
For instance, Kaduna State’s 12-month average debt service deduction from FAAC in 2011 was N469 billion. The most recent FAAC figures show that in April 2013, Niger State’s deduction was N353 million, Osun N637 million and Bauchi N257 million.
For the month of March 2013, N580 million was deducted from Kaduna’s N4 billion allocation to service debts, Gombe paid N785 million out of its N2.8 billion allocation, Benue N486 million out of N3.4 billion and Edo N697 million out of N2.9 billion.
Prof. Ogbu said “the huge domestic borrowing has not translated into an expanded productive capacity: neither our physical nor human infrastructure has appreciated in both quantity and quality.”
He said official data shows that domestic borrowing is rising and that the trend is worrisome.
“If we are devoting 20 percent of our revenue to debt servicing with huge infrastructural deficit both human and physical, we should worry. We should worry because the revenue required for the investment in the technology necessary for resolving manufacturing difficulties in the country, for the diversification of the economy and for social inclusion is going into debt service obligations,” he said.
“Is Nigerian debt becoming odious? Are we witnessing rising debt with rising affluence of a few and rising inequality? Is public sector borrowing indirectly fueling the bank accounts of public and private sector individuals? Recent statistics reveal that a few Nigerians have gotten richer while the majority is stock in poverty,” Professor Osita said.
Finance Minister Ngozi Okonjo-Iweala, in a statement sent to Daily Trust recently titled “Clarifying Nigeria’s debts position” said the Federal Government was putting measures to control borrowing.
She said the Jonathan administration has “put in place several measures to limit and manage the national debt. There are a number of specific policies we have introduced in the current administration to slow down the increase in our overall debt stock. Our current approach balances Nigeria’s needs for investment in physical and human infrastructure with a strong policy to limit overall indebtedness in relation to our ability to pay. Above all, any debts incurred must go for directly productive purposes which yield results that Nigerians can see.”
The minister said “borrowing for recurrent expenditure or consumption, as was the case here is a practice that is less than ideal and one that we should endeavour not to repeat. We must learn that domestic debt should be incurred sparingly at modest and manageable rates so that government is able to service it and pay back domestic creditors. Failure to do so would severely undermine the finances of our private and institutional creditors to the detriment of the economy.
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