For a country to achieve its objectives, it needs the buy-in of its citizens. That is the hallmark of democracy. Government of the people, for the people, by the people as Abraham Lincoln puts it.
Unfortunately, this is not the case in Nigeria today. And the disconnect between the Nigerian government and Nigerians has seen the country struggle to attain its goals.
The hypothesises today is that prudent governance would help a country blossom much more than the actual savings of the government could.
Cost of governance is a much-talked-about concept in the Nigerian political discourse – politicians are seen as flamboyant and earn some of the largest salaries compared to their counterparts in other parts of the world. There have been times when stakeholders have asked for a leaner presidency and National Assembly. But those discussions never pass the political commentary stage. There is never a political will to implement these changes.
Let us talk about the national budget. Everyone complains about how 40% of the national budget goes into recurrent expenditure. The budget expenditure of N20.51 trillion represents the highest in Nigeria’s history and is to be (partly) funded by expected revenue of N9.73 trillion. The country’s highest recorded deficit of N10.78 trillion (4.78% of estimated GDP) is to be financed by new borrowings, privatisation proceeds and drawdown on loans already secured for specific projects.
Put into perspective, Nigeria needs to generate an additional 111% of its current revenue (i.e. more than double its revenue), to be able to meet its expenditure needs without borrowing. This technically implies that some of Nigeria’s borrowings will fund consumption which isn’t healthy for the country in the long term. Loans should largely go into capital assets that bring returns on investments to pay back debt.
Apart from the quantifiable effects of reducing the cost of governance and recurrent expenditure, there are some intangible ripple effects it has. Over the years, Nigeria has been in long battles with the academic union and the labour union. When you hear their leaders speak or threaten imminent strikes, they point at several places the government can reduce costs and divert funds to address their issues.
They point at subsidy costs, they point at National Assembly salaries, they point at costs of white elephant projects, they look at the calibre of schools children of politicians study. These things make them ignore the government’s excuses for not meeting their demands even if their demands would jeopardise the fiscal health of the country. For example, government funding tertiary institutions have proven to not be a sustainable model but it is hard to explain that when they see politicians spending hundreds of millions on elections.
Additionally, Governments can generate more revenue if they can judiciously prove they can spend the country’s resources well. Expanding the tax net has been one of the most difficult things previous administrations have tried to achieve – but a lot of people do not feel they should pay taxes, especially as they do not trust their governments to judiciously use the tax resources.
Taxes are an important source of government revenue worldwide. In the UK and US – different forms of taxes constitute above 90% of government revenue. In Nigeria, only 40 million Nigerians are in the tax net and on a global scale, the West African country has one of the lowest tax-to-GDP ratios in the world.
If citizens believe the government spends proper use of their tax revenue, they will be compelled to understand increases in taxes as well and the government can depend on less borrowing.
The bridge between the Nigerian government and its people has broken to a point that people want the country to fail to justify their political points. A mere interest in running for political office is greeted with cynicism as people would view you as a potential “national cake” eater.
Conclusively, The ethos of public office should be sanctimonious and that can only be displayed in reducing the cost of governance by reducing salaries, merging agencies, and making public office unattractive as people will understand that only those who want to serve are in public office. Public office should be seen as a service and not as an occupation.
“Public office should be seen as a service and not as an occupation” This is the heartbeat of this article….