HOUSE RENTS, TRANSPORT FARES & THE MEANING OF DESPAIR @elrufai October 25, 2012Posted by seunfakze in CHANGE, POLITICS.
Tags: Nasir Elrufai, Nigeria
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Just when you think President Goodluck Jonathan should have finished settling his political debts to enable him focus on easing the hardships that most Nigerians face simply to remain alive, the man decides that the welfare of Nigerians and job creation are not his priorities. How else can one explain his plan to spend a staggering N2.4 trillion to run government in 2013? Actually, the question should be: Which government?
Broadly speaking, the major functions of government include protecting the state from external aggression, provision of stable legal and social frameworks, delivery of public goods and services, redistributing incomes where needed and stabilizing the economy. Going by that definition, one can safely conclude that Nigeria has no government, despite planning to spend an outrageous N2.4 trillion – the equivalent of some $15bn on itself next year. This is against the backdrop that this year’s budget has barely achieved 30% implementation. In essence, Nigeria is spending 70% of its income on about one million government officials that can only achieve 30% of annually-set budgetary targets.
The absence of social infrastructure is particularly glaring, since this is an aspect that can help create part of the three million new jobs that Nigeria needs annually just to clear the backlog of the rising unemployment. And nowhere is the absence of government more manifest than in the provision of public goods and services, especially in housing and transportation. Thus, even with the new minimum wage, house rents and transportation costs consume about 80 per cent or more of average household incomes in Nigeria.
Across Nigeria, the massive shortage of housing and transport infrastructure mean that in addition to rising food costs (which our government has denied), many Nigerian families spend most of their income on accommodation and transportation. What would be left for other essentials of life? What about healthcare, education, clothing and other basic essentials? It is no wonder that Nigeria remains in the list of top 15 places with the highest incidence of poverty, with over 112 million out of our 162 million people living below the absolute poverty threshold in 2011. It is sad that one of the top crude oil and gas exporters is now ranked the 25th poorest country in the world.
Incidentally, there is nothing new about these figures. What is painfully obvious is that government does not have the right statistics of housing deficits in Nigeria, nor a workable transport sector development strategy under implementation. For example, the Federal Mortgage Bank of Nigeria, recently said the Federal Government would require more than N56 trillion to provide 16 million housing units to bridge the housing deficit in the country. However, assuming that each household has an average of 6 residents, it means that 96 million Nigerians are homeless. That does not sound intuitively accurate.
Another related agency, the Federal Housing Authority of Nigeria (FHA) which has the statutory responsibility of providing housing for Nigerians has only built about 40, 000 houses nationwide since its inception in 1973. This, according to the FHA, has resulted in a deficit of about 25 million houses in the national housing scheme, suggesting that about 150 million Nigerians out of about 162 million in 2011, are homeless – even more far-fetched!. Which figures do we work with, 16 or 25 million? The figures do not add up!
In order to facilitate the sales of federal government houses in Abuja, we initiated a pilot mortgage which enabled many public servants and other citizens to buy houses. Unfortunately, the plan to mainstream the system nationally was truncated by our successors-in-office. This is why today, the only hope honest Nigerians have of owning homes is through the traditional and tortuous method – self-purchase and direct labour from life savings which is herculean since only a few people can own houses through legitimate sources. Now that this year’s flooding has destroyed thousands of homes across Nigeria, more Nigerians have been made homeless.
Apart from the massive housing deficits and the exorbitant rents Nigerians are forced to pay, rising costs of transportation occasioned by abysmal infrastructure in the sector is also consuming significant portion of household and personal incomes in the country.
Transportation is critical for economic growth in every country, but due to our poor transportation infrastructure, logistic costs for our goods and services are now typically more than 20 per cent of sales from the global average of 2 per cent. In Nigeria, transport costs alone can be as high as 15 per cent of the costs of goods or services.
Statistics indicate that for many growing economies, the value added by transportation to the economy accounts for 3 to 8 per cent of GDP while employment in transport sector ranges between 2.5 and 11.5 per cent of total paid employment. But in this year’s budget, government earmarked only 6 per cent to the Works, Transport and Aviation ministries combined, without any clear policy to get the private sector incentivized to invest more in the sector. For a struggling economy like Nigeria, intensified investment in transport will not only increase disposable incomes for millions of Nigerians, but also create millions of jobs and stimulate critical sectors of the economy.
In addition, an effective transportation system can have direct and significant effect on the daily lives of our people. Properly targeted and managed investments in transport facilities will mean efficient travel that could save time, fuel and reduce pollution. Lives will be saved and there will be fewer delays and hassles for the average Nigerian.
Efficient highways, rail systems, airlines, airports, harbours, and waterways will not only provide the backbone to grow our economy by moving people and goods around seamlessly, cheaply and safely, it can also employ millions of workers to generate substantial share of economic output in the country. If well exploited, transportation can actually contribute in excess of 10 per cent of our total domestic product annually.
Most Nigerians travel by road because we do not have a functional railway system and air travel is beyond the reach of most (though the fear of our skies has also driven more people back to our death traps on the ground). This has further compounded an already appalling situation. The state of our roads is distressing because of the level of deterioration, volume of traffic and the countless number of fatalities every day. At the moment, only about 15% of our roads are paved and of this, only about 28% can be easily used by motorists.
The excessive number of federal roads which have overstretched available resources and project management capacity of the government are largely responsible for their long construction periods and poor maintenance of existing roads. Yet every Wednesday, the Federal Executive Council awards more roads contracts that cannot be completed, while the legislature introduces more and more federal roads as ‘constituency projects’.
There is certainly the compelling need to rehabilitate our road networks and invest in road widening schemes to increase capacity through increased total lane length. Compared to the Republic of South Africa which has a population density of about 40 persons per square kilometre, with a total road network of about 754,000 kilometres that are well maintained, Nigeria with a population density of about 150 per square kilometre has only 108,000 kilometres of poorly maintained roads, most of which are unpaved. This year’s flooding has washed away important roads, including major arteries, leaving tens of thousands of travellers stranded and communities disconnected.
Why is it that despite having about 8,600km of waterways, Nigeria has been unable to put them to meaningful use? It is worth stating that effective inland water transportation has the potential to make commerce more competitive and our economy more vibrant.
Well structured, the aviation sector can be a key growth engine for our economy. An efficient and modernized aviation sector, with regulations and incentives for the private sector to thrive can make air travel an essential form of transportation, create jobs and economic growth. Nigeria needs to leverage on transport infrastructure development urgently to eliminate the avoidable logistic costs that are up to 50 per cent higher than what is normal for operations in all spheres of our economy. Such a programme would create millions of jobs and open up the entire country to rapid economic and social development.
Government must live up to its responsibility of developing and implementing policies that would strengthen primary mortgage institutions while simultaneously embarking on social housing projects across the length and breadth of Nigeria. It must also invest heavily in public transportation systems like roads, railways, aviation and inland waterways systems. That way, apart from providing urgently needed social infrastructure, the processes involved would create millions of jobs in Nigeria, promote house ownership for families and facilitate the emergence of a middle class which would in turn form the basis of economic development, security and political stability.
Why is government yet to find creative solutions to develop this vital economic artery? Why can’t we find ways to innovatively leverage the three trillion naira pension funds sitting quietly in banks, the sovereign wealth fund and whatever is left of the depleted excess crude account to address these critical infrastructure deficits?.
For now, it remains a tale of despair for majority of Nigerians who go to bed thinking of landlords, estate agents and house rents, with the voice of rickety bus conductors still ringing in their ears, “no change!” Paradoxically, what most Nigerians want and deserve is just that: Change.
MANAGING THE IMPENDING HUNGER AND MALNUTRITION by Nasir @elrufai October 12, 2012Posted by seunfakze in CHANGE, POLITICS.
Tags: Elrufai, Hunger, Nigeria
The cost of a measure or ‘mudu’ of beans reached a never-before-seen price of N500 (five hundred naira) a week ago. For most Nigerians families, beans and its derivatives like ‘akara’ and ‘moi-moi’ are the richest source of nutrients and very often the only source of proteins – meat, fish, milk and eggs having disappeared from their menus long ago.
The new price of beans means that if a small family on minimum wage buys two ‘mudus’ or measures per week, they would spend N4,000 per month, or a staggering 20% of family income on a single food item.
Being locally grown and readily available, beans is known in virtually all Nigerian homes and is consumed by most. But with such a high price, this important staple may also vanish from the list of affordable food items for many families. What makes the situation doubly alarming is the fact that the beans stock currently in the market was harvested last year, when by most accounts, farmers had a comparatively rich harvest. This year, tens of thousands of Nigeria’s farmlands are under water, having been inundated by floods from heavy rainfall and releases of water from some dams.
Beans is only a metaphor for the impending food shortages across Nigeria, worsened by the floods which devastated large swathes of farmland from Adamawa to Jigawa, Bauchi, Plateau, Benue, Kaduna, Kogi to Cross Rivers, Imo, Akwa Ibom, Ebonyi, Edo, Delta and Taraba states. Apart from the loss of lives and disruptions of travel and commercial activity, thousands of Nigerians have suddenly become internally displaced and cut from their livelihoods. With little or nothing to harvest, the price of practically all food crops eaten by Nigerians would double or quadruple.
Another implication of the damaged infrastructure caused by the flooding is that what little produce and livestock that survived the flooding may not be able to reach their traditional markets, thus resulting in higher costs to the consumer. Reports indicate that one of Nigeria’s most important food producing areas – the Hadejia Basin has been substantially washed away by the floods. Large parts of Benue State, ‘the food basket of the nation’ also experienced flooding and loss of produce and farmlands. While we count the visible losses in terms of lives, property, farmlands, livestock and critical infrastructure, the worst effects of the flooding may only manifest next year and beyond because this year’s harvest is effectively lost, and the fact that flooded communities and farmlands take years and even longer to recover, if at all.
Prolonged rains have done a lot of damage to substitute crops that in lean periods might mitigate the situation. These are largely millets, sorghum and maize. All the three missed out sunlight at critical times as the rains kept pouring in high intensity and without respite. Again, the rains persisted when the crops needed to be dried for storage. Both incidences have upped post harvest losses, further reducing supply of carbohydrates to make up for the anticipatory shortage of beans. Worse still the poor would compete with the breweries, livestock feeds and food processing companies, as well as our neighboring countries, for the scarce supplies that would be released to the markets.
Another aspect that government seems unwilling to confront is the number of farmers that have abandoned their farms in the North East and parts of North West. The case is particularly desperate in Yobe and parts of Borno, Bauchi and Gombe States. It is also important to ask why government chose to ignore flood warnings issued by the Nigerian Meteorological Agency (NIMET) until the situation got out of hand. At the moment, NIMET has forecast another round of flooding in 16 states of the federation. What is the FG doing and how would all these factors impact on food security?
The agricultural sector had consistently been above 7% in terms of growth for the previous decade, but it collapsed in 2011 and is not forecasted to grow by more than 4% this year as a result of the floods and the failure of the Jonathan’s voucher system of fertilizer subsidization. Agricultural production is unfortunately but likely to suffer a double whammy this year and next for these reasons unless we get luckier.
A serious government should not only be concerned, but should by now be taking proactive measures to ameliorate the now inevitable food shortages, as well as help farmers to resettle, while seeking more lasting solutions to flooding. Already, the price of bread has gone up by about a quarter this year. With major cassava producing states under flood, even President Jonathan’s joke about cassava bread may turn out to be another bite of empty air for many Nigerians.
Before this year’s devastating floods, Nigeria’s agricultural value was worth about N15 trillion, as against its true potential of N40 trillion. There was already a gap of about N25 trillion. What makes the situation saddening is that we have about 50 million farmers and abundant land and water resources, but out of an estimated 3 million hectares of land that can be irrigated, only about 60,000 hectares is currently irrigated. Out of about 323 dams on the country, only a few are used for irrigation purposes. No figures exist yet for the true costs this year’s floods, but it would be in the trillions of naira.
Last year, Nigeria spent N635 billion to import wheat; N356 billion on rice, N217 billion on sugar and N97 billion on fish, but it may not be that easy to solve our food shortages by simply resorting to importing food; several parts of the world’s most fertile food producing regions’ have also been inundated, or in the case of the United States, suffering from the worst drought in decades. Niger Republic – from where Nigeria imports large amounts of the beans we consume has also suffered flooding; Russia had to suspend wheat exports for a while. Globally, the price of food has gone up by about 10%, with experts predicting more increases.
Niger Republic avoided hunger in the last two years through intensive use of irrigation. The strategy not only reduced the country’s reliance on imports but it also created a new industry as well as significantly raised income levels in the affected areas. Despite our country’s vast irrigation infrastructure and irrigable farmlands, the food imports mafia is likely going to coerce President Jonathan into expensive food imports that millions of Nigerians in both rural and urban areas will not be able to afford. This strategy, by refusing to put to work assets owned by the poor in form of irrigable farms and wetlands all over Nigeria would be the same strategy that while increasing poverty in rural Nigeria, would concurrently increase income levels of the few local moguls and their Asian collaborators in the rice, wheat, stock fish, and tomato paste import businesses.
For the over 112 million Nigerians living in poverty, what would the situation be like next year when rural residents and farmers would have eaten what little of their stored foods which were not destroyed by the flood? How many Nigerian families would face starvation simply because they cannot afford even the most basic food stuff? Currently, Nigeria is ranked a very poor 80 out of about 200 countries in terms of food security. Which government can talk of safety of lives and property when tens of millions of citizens are hungry?
Government should not wait until Nigerians start dropping dead from hunger before acting. Efforts must be made to avoid the chaos that would follow any government backed massive importation of food because the process will be abused like the fuel subsidy regime. Indeed, one cannot rule out the emergence of a food subsidy cabal that will replicate the corruption that still trails the fuel subsidy cabal. (Incidentally, everybody seems to have forgotten the 2.6 trillion that was stolen by that cabal).
Nigeria must take urgent action to manage the impending national food shortages, inflated food prices and possible malnutrition for millions of families. One would expect government to consider these critical posers: what is the extent of damage to farmlands and agriculture? What is the quantity of livestock lost? How many Nigerian families are at risk of hunger and malnutrition? What is the quantity of grains left in our Strategic Grain Reserve and functional silos nationwide? What quantity of food do we need to import, from where and at what cost?
A government with vision would take immediate measures to protect millions of vulnerable Nigerians from the effects of rising food costs, hunger and malnutrition, while considering long term measures to rebuild damage infrastructure, incentivize farmers and improve the agricultural sector. In the 2013 budget proposal, agriculture has been allocated only N80bn against the background of the challenges the sector faces. What is the thinking of government? Obviously, it is yet to appreciate the enormity of the looming food security problems. With a meager 35% for infrastructure and other capital investments, we have not even started.
If millions of Nigerian families are already facing hunger because of government inactivity and misplaced spending priorities, imagine what it would be like at the turn of this century – when all our oil would have dried up, or when technology would have made fossil fuels redundant? By that time, Nigeria would have a population of over 700 million. We hope that the governments of those days will be better and more proactive than the ones we see today.
#SaveNGFloods: WHAT CAN WE DO? October 9, 2012Posted by seunfakze in CHANGE.
Tags: committee, evaluation, flooding, funds, monitoring, Nigeria, transparency
Today, I met with a representative of the World Bank, Nigeria at the instance of the Country Director. My clear objectives were to discuss methods on how citizens can measure the impact of disbursed funds, and seek the collaborative effort of independent monitoring groups/individuals in monitoring and evaluating of the funds.
The representative explained the modalities of the World Bank on disaster assessment in great detail. Their PDNA, Post Disaster Needs Assessment, is a comprehensive and rigorous process of assessing damage done during disasters.
He cited instances of previous ones done in Benin Republic flood, the Horn of Africa, etc. and how their efforts have been effectively used to access funds to the areas of need. The World Bank, according to him, do not step in during the haphazard, sometimes unplanned, stage when relief materials are given and donated to IDPs since those are mostly done by government, philanthropists and other independent donors.
Their work comes in after the first stage and it is intended to weigh the impact of the disaster in health, economical dimension of affected IDPs, welfare, infrastructural challenges (of individual or govt/public assets affected,) amongst other areas. This is further broken down to involve Damages and losses which ultimately helps them plan the budget (so as to access funds from pool of donor bodies).
ON MONITORING GOVT RELEASED FUNDS
He said critically that the “world bank doesn’t come in unless they are invited”. That, according to him, is the only way they can get involved or monitor what has been released (the N17.6bn).
MY DEEP CONCERNS
1. CITIZENS WATCH
Pictorial and video data collation, evidence based recording of issues revolving and surrounding the flood is key. Clusters of citisens across and around the affected zones must help in this way. It is one of the easiest and most effective way. RECORDS!
Rigorous Monitoring and Evaluation process to monitor how the funds are disbursed from the agencies, and how they are effectively utilized. This would obviously require independent bodies (individuals, NGOs, CSOs, etc) to assist in the assessment to keep track of all public issue.
Remember the Ibadan and Northern Nigeria floods: what happened to the money disbursed? What happened in the community? How was the money spent? Was it effectively utilized? What has been the impact of the money spent? These are the critical areas where Clusters of decisive critical citizens can weigh in.
Now that the government has set up a committee comprising Alh Aliko Dangote, Mr Olisa Agbakogba; We should be interested in knowing what expertise they have to consult for the government on the flood (asides the funds they are saddled to raise). If not, are there plans to involve such people/organisations to effectively appraise the situation in the required phases? Or Why not lean on the expertise and experience of the World bank to do this?
Other questions: a top-down approach from the government will not suffice. Setting up a committee and meeting in Abuja is one thing, getting to know the real issues, the challenges, etc in the flooded areas requires thorough assessment of the communities.
3. MONITORING/EVALUATION — How do we keep track of funds disbursed? how can we Mobilize the private sector to support/fund the mobility of independent assessments for monitoring and evaluation? Or devote the attention of technological innovation to community mapping such that progress reports on situations of camps, IDPs, relief materials, post-disaster management can be monitored and evaluated in an effective and transparent way?
I have my deep concerns, they are not in any way disconnected from the “usual Nigerian syndrome” in which public funds are misappropriated and eventually do not reach the desire target. In this case, it is lives and properties involved.
Citizens impact in this flood can be huge but so far, responses to capture data to provide necessary has been slow. Their valuation/assessment of relief responses and monitoring of impact of the funds can go a long way. Data is king. Can our brothers and sisters across the nation ensure this documentation is done in the absence of required funds for an incisive citizens watch?
What can we do?