For Nigerians, who voted en-mass for President
Muhammadu Buhari in the 2015 general elections, it is key to reflect on the
realities of the economy and focus on the policies and initiatives this administration
is implementing to reset the economy whilst investing to stimulate growth and
diversification of the economy.
In a year of Fiscal Housekeeping with a robust
plan for revenue generation and in an environment where people are used to a
culture of celebration, no epoch will go unnoticed.
In the usual practice on the occasion of an anniversary, it is not out of order
if Nigerians choose to roll out the drums and begin to count their blessings
one year after the new administration was inaugurated; as it ushers in critical
changes to fiscal discipline within all federal government ministries,
departments and agencies.
However, Nigeria has been hit by a combination of
very low oil prices, decreasing export volumes of crude oil and the effects of
a lack of critical investments in infrastructure over many years of neglect.
Unfortunately, the change in government has come
at a period when there is the will to forge ahead without commensurate money to
invest and as the Honourable Minister of Finance, Mrs Kemi Adeosun, put it, we
are in a period when the safety blanket of oil has been ripped away, laying the
poverty of Nigeria’s institutions bare. Today, the current administration is
faced with the stark reality of the volatility in the global oil market and the
attendant erosion of revenue accruable to the country.
That notwithstanding, this administration has
taken a positive approach of critical borrowing and targeted investment in
infrastructure to ensure that we start to build the required infrastructure to
stimulate growth in all sectors of the economy.
Nigerians, in their support for the new
administration would not accept any excuse for failure. There is the need to
refine how we collectively work towards ushering in a new era in Nigeria.
Framework for the future: With a
resolve to leave a good legacy, the administration came up with a framework for
the future of the country. It is tackling the inherited problems of governance
through three critical and inter-dependent aims; fiscal discipline; targeted
investment and economic diversification.
According to the Finance Minister, “This
administration is committed to disciplined expansion to catalyse economic
reform. We are implementing fiscal policies designed to achieve Nigeria’s growth
and development objectives while extracting efficiencies to ensure long-term
viability of public finances.”
Fiscal discipline: As we endure
a period of serious threats to the nation’s finances, it is necessary for this
administration to vigorously pursue a policy of fiscal discipline (plugging the
leakages) by waging war on corruption, inefficiency and negligence. It is
therefore not a coincidence that this administration has a strong focus on
transparency. In the last one year, the Buhari administration has declared its
commitment to guard against wastage and leakages within the system, strengthen
institutions weakened over the years through corruption, inefficiency and
negligence.
The Minister of Finance promised that along with
transformative capital investment being undertaken, government will
concurrently develop the much needed systems and controls for monitoring,
tracking and ultimately, optimising investments it intends to make.
Giving account of her stewardship in the office,
Adeosun disclosed that “As part of fiscal housekeeping, we have introduced
programmes designed to audit and rationalise personnel related expenditure,
which accounts for over 40 per cent of total government expenditure, reduce
overheads, increase expenditure efficiency, and consolidate extra-budgetary
revenues.” Indeed, the Federal Ministry of Finance, in the period under review,
embarked on a tailored MDA Revenue Strategy, which entails a detailed
identification and strategic mapping of revenue sources being undertaken by all
agencies. The Minister explained that independent revenue generation of
N1.5trillion in 2016 is being targeted, while incentive measures (e.g. cost of
collection) are to be implemented where appropriate.
Tackling corruption: The
administration’s message on war against corruption is not lip service. In the
last one year, government has been consistent in its offensive against the
cancer of corruption.
Recoveries: For the first time
in Nigeria’s recent history, the authorities have shown tremendous determination
in pursuing those who are thought to have misappropriated public funds. This
time, a pragmatic approach is being taken from an economic perspective, the
primary objective being to fully recover looted funds to be directed towards
productive use to benefit the economy. In addition to cash being
recovered, real estate and other physical assets are in custody.
Improving tax collection: At a
period when there is a 70 per cent drop in revenue (as a result of a
combination of falling oil prices and disruptions to production) it makes sense
that the administration has continued to focus on improving the efficiency of
tax collections and broadening the tax base. President Muhammadu Buhari has
sent a strong message to the Nigerian people with the appointment of a new FIRS
Chairman, who has a remarkable track record as the CEO of the Lagos State Board
of Internal Revenue.
The Finance Ministry is also deploying
appropriate technology to enhance collection. Such technology has enhanced our
capacity to link up databases from diverse government agencies; thereby
increasing efficiency.
Also in place, are the systems for auto debits of
VAT from corporate entities and government contractors and the rollout of
Biometric Verification Number (BVN) across all bank account holders.
Results to date include 363,000 new taxpayers
being added to the FIRS database, while FIRS staff has continued to receive
increased incentive pay for delivery on targets.
Nigeria Customs Service: In the
course of the year, the campaign for enhanced revenue generation has also been
applicable to the Nigerian Customs Service. The minister explained that in
order to increase revenue generation capacity of the Customs Service, the
Federal Government is investing over N20bn in equipment upgrades and capacity
enhancement across customs services.
This will boost the transparency and efficiency
of customs collections. The Federal Government is also implementing a
performance based staff incentive scheme, in line with what is in place within
the FIRS.
In addition to these, an electronic platform has
been developed to improve service delivery, efficiency of ports clearance and
collection of customs duties.
Payroll reforms: Another area of
focus is the government’s payroll reforms. The Integrated Personnel and Payroll
Information System (IPPIS) is a centralised payment and payroll system. So far,
enrolment of civil servants onto IPPIS has been accelerated with the use of the
Bank Verification Number scheme. At last count, 447 MDAs with a total staff
count of 309,472 are on the system, while full enrolment of remaining staff is
to be completed in 2016. In the course of the exercise in recent months, 43,122
fraudulent entries have been identified, representing an average of N4.2bn.
Akanbi is the Special Adviser on Media
to the Minister of Finance
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