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Tag: Alex Otti

  • Nigeria’s Budget 2020: Nice try but…, By Alex Otti

    Nigeria’s Budget 2020: Nice try but…, By Alex Otti

     

    “It is not enough to be up to date; you have to be up to tomorrow”

    David Ben-Gurion, Israeli Statesman

     

    On October 7, 2021, the President presented the 2022 budget, to the joint session of the National Assembly. It was christened “Budget of Economic Growth and Sustainability”. For the third year running,the Presidency has been able to present the national budget earlyenough to enable the statutory, full January to December implementation period. In compliment, this has been a departure from previous practice where budgets get approved, sometimes by the middle of the relevant year. In addition, it also gives clarity to policy makers and helps all stakeholders to effectively plan.

    The total proposed size for the 2022budget is N16.4 trillion as against current year’s budget of N14.6 trillion. In nominal terms, this represents a 12.5% increase. From the figures provided, total proposed revenue is N10.1 trillion as against the current year’s N8.1 trillion, representing a 25% increase. From the above figures, a deficit of N6.25 trillion, marginally lower than current year’s deficit of N6.45 trillion is envisaged. This deficit is expected to be financed by new borrowings, privatisation proceeds and drawdown on existing approved loans for specific projects. Recurrent expenditure,less debt service is budgeted at N6.83 trillion, 60% of which, or N4.11 trillion, is for personnel cost. Capital expenditure on the other hand, is budgeted at N4.89 trillion, representing 30% of total expenditure.

    The provisional 2022 budget stands on the following assumptions:

    1. Benchmark crude oil price of $57 per barrel as against that of the current budget set at $40 per barrel
    2. Oil production of 1.88 million barrels per day, which is almost the same with current year’s budget of 1.86 million barrels per day.
    3. Exchange rate of N410.15 as against current year’s rateof N379 per dollar
    4. Target inflation rate of 13%. Current year’sbudget rate is 11.95%
    5. GDP growth rate of 4.2% as against 3% rate of 2021.

    We shall return to these figuresshortly.

    In his presentation, the President explained the huge spending on the back of the current security challenge and thepost-recession economic recovery and growth. He went further to state that the country is facing a revenue challenge rather than a debt sustainability challenge. Clearly, this assertion isagainst what many analysts believe. The government, therefore, hopes to grow revenue as per the GDP ratio quite significantly during the period; from 8% to 15% by 2025. To achieve thisdaunting goal, the president unfolded a few strategieswhich include, enhancing tax and excise revenues; reviewing tax waivers and concessions policies; improving Customs revenues using technology, and preserving the revenues derived from the oil and gas sector. It is our contention that while every move to improve the revenue base of the country is welcome, until the diversification of the revenue sourcesbecomes effective, a lot of impact will not be made on the economy. Total revenue from oil and gas currently stands at about 80% of our foreign currency earningsputting the country at great risks of oil price and quantity shocks.The budget under review provides that out of the estimated total revenue of N10 trillion, oil and gas alone would account for over N3 trillion or 30% of the revenue.

    In terms of absolute numbers, the 2022 budget is the largest so far. Not too long ago, we saw budget figures of N6trillion in 2016 which went up to N8.9trillion in 2019and further rose to N10.6trillion in 2020 and later revised to N10.8trillionlargely due to the impact of Covid 19 pandemic and then N13.08trillion in 2021. So, the projection of N16.4trillion is large on the face of it.However, this same budget assumes an inflation rate of 13%, up from an inflation rate of almost 12% in the current year. Therefore, an increase in absolute figures of 12.5%, basically leaves the numbers unchanged.So, in real terms, the 2022 budget is not any different from the 2021 budget. Now applying this number to the population which is estimated to be growing at close to 3% leaves the expenditure per head dropping when applied on a yearly basis.

    On the assumptions made for the 2022 budget estimates, we consider that the benchmark price of $57 per barrel is very realistic. Giventhe current price regime of over $80, which from all indications will remain for a while, this benchmarkwould leave the economy with significant surplus, which would accrue to the Excess Crude Account (ECA). However, given the average production level in the current year, which stands at about 1.2m barrels per day, it may be difficult to expect that the projection of almost 1.9m barrels per day would be met.The benchmark exchange rate at N410.15 is only realistic to the extent that it is the official rate considering that the rate at the unofficial market is gone beyond N570 per dollar.Besides, if the report that some key members of government are calling for further devaluation of the Naira is anything to go by, then the benchmark rate may not hold for most of 2022.Target inflation and GDP growth rates also appear not to be realistic as we can see from average inflation rate of 17% this year and average GDP growth rate of about 2% at the moment.

    Drilling down further, 70% of the budget is expected to go into Recurrent expenditure while 30% would go into Capital expenditure. This allocation formula remains the albatross of the Nigerian economy. Recurrent expenditure basically has to do with payment of salaries and allowances of public workers and their dependants, whose number is no more than 1 million people, while the rest of the close to 200m people would be impacted by just 30% of the budget by way of Capital expenditure.This column maintains that there is a need for an urgent and serious conversation around this issue. Even if the revenue of the country miraculously doubles, and this matter is not addressed, the country will make little or no progress. Other than salaries and allowances, there are also humongous numbers that must beinterrogated. These include statutory transfers to the National Assembly, Judiciary and other agencies of government totalling N768b. N2.3b is to be set aside for the entitlement of former Presidents and military heads of state. Another N4.5b is for retired Heads of Service and Permanent Secretaries. There is also a N1b set aside for severance benefits for retired Heads of government agencies and parastatals. The defence budget of N2.4trillionis only defensible given the security situation in the country. However, it must be noted that some of the major causes of insecurity would include the rising level of poverty, the high rate of unemployment and the lack of economic opportunities experienced by a growing number of the youth population.Everyone agrees that it is better to repair a pothole than to spend money building a clinic that will treat the victims of the gaping pothole.

    There is still the big elephant in the room, which is the debt profile of the government. Like has been highlighted earlier, embedded in the budget is a deficit of N6.25trillion to be financed by debt. Also provided for, is a N3.6trillionbudget for debt service. This represents 22% of expenditure and 36% of total revenue! It is important to remember that as at June 30, 2021, Nigeria’s total debt stock stood at N35.5trillion or $86.6b. While these numbers are disconcerting on their own, there is a more fundamental issue of revenue shortfallswhich have been the experience of the country in the last few years. On the average, the country has only been able to deliver about 60% of its statutory revenue budget. What this automatically means is that the country has consistently busted its proposed deficit ceiling as its recurrent expenditure has always been met. Logically, the casualtiesof this short performance are capital expenditure and deficit financing. All these point to the fact that by the end of the budget period in 2022, the country may witness much more than the 36% of revenue going into debt servicing. The jury is still out as to the long-term sustainability of this practice. We leave that to the imagination of the perceptible public.

    Beyond infrastructure which got a proposed spend of N1.45trillion, the other areas that areof primary importance to the ordinary Nigerians are Education and Health. These two got N1.29b and N820b respectively. These numbers represent 0.8% and 5% of the budget respectively. In terms of the healthcare budget, it is important to remind us that in 2001, heads of government of the African Union, gathered in Abuja and committed to allocating a minimum of 15% of their annual budgets to healthcare.Some African countries have since complied. Ironically, the host countryof the meeting where that decision was taken has only complied in breach! If not for the pandemic, the likelihood of getting the allocation up to the present 5% would have been very bleak.

    There is no doubt that the country has a big problem. This problem is structural and must be resolved for the economy to start moving again in the right direction. The country has a problem with productivity. A situation where the country, for more than half a century, relies on a single product which the populace adds little or no value to for a large chunk of its foreign exchange earnings is not sustainable. No matter what it takes, the country needs to expandher productive base by getting more peopleto participate in economic activities. The poor participation in economic activities can be seen by a mere look at the GDP per Capita which was about $3000 in 2014 but has dropped to about $2000 today. The contradiction is that while the population is growing at about 3% per annum, GDP in some years have declined or at best remained flat for many years. The large population should ordinarily be a blessing in terms of labour force and larger demandmarket, but Nigeria’s has remained a burden as more people are thrown to the labour market with very little demand power.Theoretically, an expansionary budget should stimulate growth by way of creating jobs, increasing output, reducing poverty and even improving infrastructure for further growth. However, with increasing budgetary allocation on ayearly basis, poverty seems to be increasing with it.Presently, poverty rate stands at 44% as against 38% in 2015, and unemployment continues to soar at close to 35%.The major reason why increased spending doesn’t seem to stimulate the economy is that the spending is not on the right items. Increasing cost of governance and recurrent expenditure generally fuels inflation, impacting cost of living. So, it is recommended that the government must prune down its spending particularly in the recurrent space. Even with the little spending in Capital expenditure, the budget has always had many disparate and fragmented projects and spending on them, does not impact the economy positively.The spend in the transportation sector, particularly rail has started making impact on the economy. Government must spend on creating the enabling environment to spur the private sector to produce locally for consumption and export.

    The vexed issue about ‘under recovery’, a euphemism for subsidy by the NNPC, continues to gulp a major part of the budget. This column had called on the government to use the opportunity of the massive fall in oil prices in 2020 to finally draw the curtain on subsidies. This call was not heeded at that time and the country has once again experienced an increase in oil prices which is good on one hand but poses its own challenge as subsidies rise. According to estimates coming from the Ministry of Finance, the country would spend a whopping N1.8 trillion on subsidies by the end of this year. Consumption is another factor that is rising. There is no agreement on the total daily consumption of PMS by Nigerians but those who should know argue that genuine consumption is around 30 to 40 million litres per day. However, according to the NNPC, consumption increased to 103 million litres per day as at May this year. Meanwhile DPR has put the actual daily consumption at 38.2m litres per day as at last year. The only way to tame this monster is to do away with subsidy.

    We cannot conclude this discussion without acknowledging the state budgets. However, beyond the “Quabalistic”budget that runs into trillions of Naira, (despite how much of it is implemented), other states average about N100B and therefore are unable to significantly affect the outcome of this analysis.

  • Towards preserving value of Naira outside the box – Alex Otti

    Towards preserving value of Naira outside the box – Alex Otti

    BY ALEX OTTI, Email: alexottiofr@gmail.com

    “Without the opinion of an expert there’s no such thing as certainty.”
    ― Joanna Ruocco

    We opened a debate here on July 5, 2021, on the loss of value of the Naira. Subsequently on August 5, we published one of the feedbacks we got from Mr. Eustace Odunze an economist, banker and lawyer.

    Since then, we have continued to receive interesting reactions from readers from across the world and we feel highly honoured that this matter is generating a significant level of interest and we are gratified that the column enjoys very wide global readership.

    Today, we will publish another reaction this time around, from Prof. Ifeanyi Uzoka, who we can deduce from his name, is a Nigerian, and a Professor of Economics at the Pilon School of Business, Sheridan College, in Mississauga, Ontario, Canada. We thank Prof. Uzoka for writing in and enjoin others who have useful contributions on this important topic to follow suit.

    RE: THE DEPRECIATION OF THE NAIRA, BY PROF. IFEANYI UZOKA, PhD, CPA, CGA.
    The value of the Naira is just a manifestation/symptom of the deteriorating state of affairs in Nigeria. The current low international value of the Naira did not happen overnight (it started in the 1980s), and rectifying it will require sustained purposeful efforts that go beyond the obvious imbalance between the Demand and Supply to addressing the following:

    a. the drivers of the FOREX market forces (Demand and Supply),
    b. purposeful integration and coordination of Monetary, Foreign Exchange and Fiscal Policies and
    c. Political Will (to fight corruption and other societal ills).

    On the Demand side, we should deal with the Psychology (behavioural tendencies) driving our FOREX Demand. As long as most Nigerians continue to value foreign products more than local products (that address their needs better), forex demand will continue to exceed supply and Naira’s depreciation will not stop. How do you explain that most Nigerians prefer processed foreign food to their own natural/organic food? How do you explain that a Nigerian will prefer to send his child to a foreign University (that grants a next-to-worthless degree certificate without any employability skills) just to brag that his child is schooling abroad? A Nigerian parent terminated his child’s education in a Nigerian Federal University, only to send the child to a West African country where the child graduated with a ‘First Class’ Degree. When the child applied for a master’s degree and submitted transcripts for evaluation, the Degree was adjudged to be less than a Canadian Bachelor’s degree.

    We need to deal with the inferiority complex, that makes many Nigerians feel that everything foreign is better than what is obtainable locally, if we must curb this insatiable demand for FOREX.

    There is also a need to cease treating the different Macroeconomic policies as Silos (like it happened sometime ago when the Finance Minister was pleading with the CBN Governor to reduce interest rates in order to boost Aggregate Demand, and the CBN Governor, standing on the same podium, said that CBN will be raising interest rates to fight inflation). Nigeria’s Macroeconomic policies must be designed and coordinated to support one another to advance the economic wellbeing of Nigerians.

    In this regard, there is need to design and implement fiscal policies that will incentivise economic agents to make decisions that support the effectiveness of our Monetary and FOREX policies. For example, beside increasing IGR and boosting local production of cars, such policies like PROGRESSIVE ROAD TAX on (Private/Luxurious) vehicles will go a long way in curbing our inordinate desire to spend FOREX on imported Luxury cars and frivolities. If there is a quarterly Road Tax of N500,000 on private Luxury vehicles with Engine Capacity of 3.0 liters, manufactured in the last 5 years, how many of us will still be willing to have a fleet of luxury cars in Nigeria? Our expectations drive our choices!

    Rather than banning Foreign undergraduate studies from accessing FOREX, the Government can impose a graduated Foreign Education Tax, exempting some Medical Science courses. This can range from 5% to 20% – the higher range being for Secondary Schools. Failure to pay the tax when due will attract penalties. The income generated from this will be applied to public education in Nigeria. Similar treatment for medical tourism could be imposed.
    Beyond the introduction of Policies, there must be a Political Will to implement them and, a revitalised independent Judiciary to try alleged offenders. These kinds of Policies, addressing the psychology that drives FOREX Demand, will do more to curb our insatiable demand for FOREX than the current knee-jerk reaction called Monetary and FOREX Policies.
    On the Supply side, I agree that there is a need to increase supply of FOREX. Much of our supply is driven by Oil revenue and Remittances. In addition to increasing our FOREX earning potentials through exports of other commodities, we should also actively pursue the export of Services, especially, in the form of Human Capital. We have an abundance of it. All we need is to add more value to our Human Capital through re/training to enhance their employability skills.
    According to Philippine Statistics Authority, Philippines’ remittances in 2019 was $35.17bn from 2.2m migrant workers. About 40% of these migrant workers were in Elementary Occupations, while about 17% were Technicians and Professionals*.

    Imagine the upsurge we will have on remittances to Nigeria if we have a policy to re/train some of our youths and professionals to meet labour demand abroad? Recently the UK Govt came calling for 5,000 doctors from Nigeria because they know the high performance of Nigerian doctors. With the proper policies, the Government can earn FOREX through fees from foreign employers and taxes from the expatriate workers (which will be used to fund public education in Nigeria) apart from the remittances of these expatriates. Nigeria should leverage the potential of the Knowledge Economy to boost her FOREX earnings.

    As long as our government continues to import Fuel our FOREX Supply will always be less than the demand, and our Naira will continue to depreciate while investment will be drying up in the country due to rising inflation. The government has to stop this madness of fuel importation! The government should design and implement viable policies that will increase refinery capacity and make Nigeria self sufficient in refined petroleum products (even, an exporter of refined products as was envisaged in the 3rd or 4th National Development Plan).

    Even with the best of Political Will, coordinated macroeconomic policies, regular electricity supply, improved local production and infrastructure amongst others, a sustained reversal of Naira’s depreciating trend will still take some years of consistent and purposeful efforts, from the Nigerian authorities (and Nigerians).

    REACTION FROM ALEX OTTI
    I want to thank Prof. Uzoka once again, for his feedback which I must confess is very germane and helpful in the debate. Just like any other economic subject, addressing the matter of the depreciation of the currency does not have, nor require, any silver bullet. Just one month since we started this debate, the Naira has lost over N20 in the foreign exchange market. This situation is distortionary and makes planning virtually impossible. The Central Bank has so far responded by cutting out one set of middlemen, the Bureaux De Change operators, from the official market and asking their customers to henceforth approach the banks instead for their needs. The banks have also responded by restating their ability to meet demands. The truth, however, is that the banks can only handle documented transactions. There are many undocumented transactions which customers have inevitably resorted to the parallel market to fund. It is this pressure that has pushed the rate at that market beyond N520 per dollar, as at last Friday, August 27.
    Prof. Uzoka was spot on in his recommendation on the alignment of fiscal, monetary and foreign exchange policies. The risk with not doing this is that sometimes, an adjustment in one area could undo the gains or even stability of the other. For instance, monetary policy may dictate increasing interest rates to deal with speculative attack on the Naira while the same action would discourage borrowing leading to reduction in productivity, reduction in GDP and increase in unemployment. This is the challenge of economic policies, managing the interplay of the ‘unholy trinity’, namely free movement of capital, an independent monetary policy, and a fixed or managed exchange rate policy.
    On the issue of the penchant of Nigerians to patronise foreign goods, foreign education and medical tourism, I believe that these require further debate. While it is agreed that moral suasion is one of the instruments available to monetary authorities (central banks), I believe that being rational economic beings, desired results can be achieved if backed by sound economic policies. I have always held the view that once the forces of demand and supply are distorted through government action or inaction, rational reactions cannot be guaranteed. If exchange rates are subsidised one way or the other, it becomes cheaper to consume imported products and may actually lead to the unintended consequence of discouraging local production, since the market is driven by competition and profit. Therefore, the question to ask is whether the local currency is appropriately priced. On education, I am of the view that greater attention needs to be paid on the quality and quantity of education in our country. The educational standards in Nigeria have dropped quite badly and continue to drop on a daily basis. Recently, videos were circulated on the social media on the state of the facilities in some of our premier universities. Those videos were such a sorry sight, but not much action seems to back up the outrage that followed the viral circulation. The curricular and the quality of the teachers cannot meet up to what we expect in the 21st Century global environment. Most of our graduates are unable to compete in the emerging scenario of globalisation, robotics, artificial intelligence and 3D printing. In the light of all these, it will be difficult to sustain the argument of discouraging Nigerians who can afford it, from sending their children for education abroad. I believe the same argument goes for medical tourism. There are very few hospitals that can boast of state of the art medical and diagnostic equipment in the country today. Yes, our medical personnel remain well sought after and that is why England and very recently Saudi Arabia have been engaging in massive recruitment drive from Nigeria. It is also difficult to ask someone who is poorly (or even hardly), paid not to jump at the opportunity for greener pastures. Patriotism comes after the stomach is full.

    Just like Mr. Odunze, Prof. Uzoka believes that the supply of forex can be enhanced by remittances from Nigerians in the diaspora. While this is not debatable, we must also understand that many of our people may not fit into the jobs that are available abroad. Those who fit into the profile have either left or are in the process of leaving. These are the highly trained professionals and skilled workers who still have age on their side. The kind of skills and temperament Filipinos have is difficult to find in many of our people.

    I know some of us would feel upset and might want to debate this and they are welcome. Instead of exporting poorly skilled and trained people, can we not properly train them and productively engage them for the growth of our economy. It is agreed that our level of economic activity and therefore productivity is very low. Over 33% of our labour force are not contributing anything to our GDP. Over 60% are contributing less than their potential.

    I implore that we be deliberate for a change and sit down and say we want to get everybody doing something that will add to our productivity. That is where the political will comes into play. For starters, we can decide that no matter what it takes that we want to double our electricity generation capacity in one year and double that in another year. This is not rocket science! This singular action would make hitherto unprofitable economic activities become viable once again.

    The admonition about importation of refined petroleum products could not have been better put. Just like in the power sector, the neglect of this sector is not excusable. While it is laudable to refine our petroleum products locally as it will cut the logistics cost of exporting crude and reimporting the refined version of the same product and create employment, it must be noted that this will not necessarily improve the supply of foreign currency. This is because the share of the crude that would be refined locally would not be available to be sold offshore.

    Having said all these, this column still believes that less attention should be placed on the foreign exchange market. We should see forex as a product just like any other product. Forex should be sold and bought by the central bank and other participants just like any other product where demand and supply determine price. With more productivity and production, foreign exchange earnings would naturally improve and foreign exchange demand to fund imports would reduce. This interplay would determine price at the equilibrium level.

  • Who are you to ask me questions? – Alex Otti

     

    “The world will not be destroyed by those who do evil, but by those who watch them without doing anything” Albert Einstein

     

    One of the imperatives of democracy is that the citizens must always be able to engage their representatives in government, asking them questions and holding them to account at all times. In fact, leadership should report to its true employers, the people. Where this is the case, leadership is beholden to the people, knowing fully well that it can be ‘fired’ by its employers.

     

    Unfortunately, the scenario painted above is hardly the case in many African countries. What we find here is that in many cases, leadership turns itself into sit tight despots, threatening, insulting and bullying any one who dares to ask questions and wants to hold it to any form of accountability. In the course of doing so, it believes that it would silence the people and plunder the patrimony without responsibility and with no consequence. It is, however, instructive that once the people keep quiet, they wittingly or unwittingly consent to the plundering of its resources and therefore are vicariously culpable, like Albert Einstein aptly stated above.The reason why leadership seems not to care about the people is because it can perpetuate itself in power by hook or crook irrespective of what the people do. One of the ways to do this is through a compromised electoral process using compromised members of the society. But that is a story for another day.

     

    A few weeks ago, the immediate past Commissioner for Finance in Abia State, Mr. Obinna Oriaku, was invited and detained by the Economic and Financial Crimes Commission (EFCC) on the heels of a petition filed before the Commission by a Company called Ziplon Nigeria Ltd, over a contract entered by the State government in 2014, which the government apparently breached. Also invited was his predecessor, Mr. Phillip Nto. The details as released by Mr. Oriaku, is that the former Governor, T.A.Orji, had signed a consultancy contract with two companies, Ziplon Nigeria Ltd and Mauritz Walton Nigeria Ltd, to be paid 20% and 30% fees respectively, on Paris Club refunds received from the Federal Government. This means that for any money received under this heading, 50%, yes, half of the money refunded, would be paid out as fees to these consultants! He further revealed that before he was appointed a commissioner in 2015, some N8.2b was received as Paris Club refund by the previous government. Strangely, there was no record of what happened to the money or how it was disbursed. Under his watch, he went on, the government received N22b as Paris Club refund,out of which the consultants were asking for N11b as fees. According to his account, he refused to pay the said sum and for that reason, he was dragged before the EFCC.

     

    In my own capacity as a responsible citizen and key stakeholder in the state, when I waited for about ten days and there was no word from the Government of Okezie Ikpeazu on the matter, I issued a press release where I raised pertinent questions and made demands that I expected the government to address. In the release titled “Abia Paris Club Refund: Stealing At An Industrial Scale” I made some few points and posed a few questions as follows:

    1. What was the role of a consultant, and in this case, consultants, in the process of the Federal Government making refunds to State Governments?
    2. If there was any other place in the country where consultancy fees were more than 5% of refunds and wondered why anybody would ordinarily sign away 50% of their money as fees to consultants?

    3.That granted that the agreement was signed by the previous government, what effort the present government made to cancel the vexatious contract, since if that were done, the contractor would not have had the legal basis to institute an action in court nor petition the EFCC?

    1. What effort the government was making to confirm what the previous government did with the N8.2b refund which the former Finance Commissioner claimed he did not see any record of how it was used?
    2. That the government should take more than a passing interest in the matters before the EFCC and the High Court to ensure that the matter was not only muddled up but expanded to include recovery of looted funds from the treasury of the state.

     

    Upon the issue of my press statement, Governor Ikpeazu immediately let loose his attack dogs on me simply for daring to ask questions. His Chief Press Secretary went agog and took to the media, abusing me and calling me all sorts of names. A few hours later, his Commissioner of Information took over, lampooning and insulting me for daring to ask his boss questions about his stewardship and social contract with the people. Interestingly, they said practically everything except that they failed to answer the simple questions I posed. Since those questions remain unanswered till date, they will continue to be asked and the public will continue to wait for their answer.

     

    Abia is a state that has been very badly governed since the return of democracy in 1999. Matters have been made worse since this administration started in 2015. The tragedy is that Abia is also a state that receives so much in Federal allocation as an oil producing state. Despite its relatively huge earnings from oil proceeds every month, Abia’s debt profile, according to the Debt Management Office, has more than doubled from N33.53b in 2015 to N70.57b by March 31,2021.This has been under Ikpeazu’s notorious watch. Despite the bail out funds and Paris Club refunds from the Federal government all totaling over N36b, the state has taken its record of indebtedness to its workers to an unconscionable high. For instance, as at June 2021, the following Abia State government workers have outstanding salaries as follows:

    1. Abia State Polytechnic, Aba -27 months
    2. Abia State College of Education, Technical, Arochukwu- 31 months
    3. Abia State primary school Teachers- 28 months
    4. Abia State Secondary School teachers- 18 months
    5. Abia Health Management Board,13 months
    6. Abia Local Government Workers- Between 3-7 months
    7. Abia State University Teaching Hospital- 19 months
    8. Abia State Pensioners- 28 months

     

    With teachers’ salaries, both at the primary, secondary and tertiary levels outstanding for several months, one wonders what the government is expecting from the educational sector of the state. What kind of products are we expecting from schools whose teachers are not being paid? It is sad that this is happening in a State that owes its past glory to huge investments in education and manpower development.

     

    Another serious concern is the non-payment of salaries to medical workers in the state even during this period of medical emergency, where health workers elsewhere are paid extra allowances to keep them focused on saving lives. Just a few days ago, the Nigerian Association of Resident Doctors, NARD, threatened to terminate the training of medical students at the Abia State University Teaching Hospital, Aba, over protracted industrial action. According to the News Agency of Nigeria, NAN, the first Vice President of NARD, Dr. Aromo Adejo, in an interview disclosed that NARD would instruct all relevant government agencies to stop training medical doctors at Abia University Teaching Hospital and withdraw their accreditation forthwith.Dr. Adejo asked a very pertinent question thus“if Doctors are always on strike, who is training its medical students?”Again, in the tradition of the Ikpeazu government,one would not expect that the issues raised by Dr. Adejo would be addressed, but the vuvuzelas of the government will take to the media in their knee jerk fashion, to attack the gentleman and rain all sorts of abuses on him.

     

    Now, compare the case of Abia to that of Edo state under the urbane Gov. Godwin Obaseki. An Edo state citizen, one Mr. Laba Lawani did a video and posted same on social media with respect to a poor road construction going on in his community, Igarra, Akoko- Edo local government of the State. In the video, Mr. Lawani exposed the shoddy construction going on as he used his bare hands to remove the asphalt already poured on the road and also dismembered the drains just by a mere touch of the cement plastered on ordinary sand without rods nor concrete. While doing so, he appealed that if the government was not ready to buildquality roads, it should not bother at all. This was said to be just a 200-metre road attracted by the Member representing the Akoko-Edo constituency in the Federal House of Representatives, Peter Akpatason at the cost of N360m. The video naturally went viral. While attempts were made by Mr. Akpatason to defend himself, the governor of Edo State, Mr. Godwin Obaseki, stepped in quickly. He dispatched his deputy for an on-the-spot assessment of the road. He further directed that the State agency takes over the construction of the road as he agreed that the construction was indeed substandard. He did not stop there. He ordered the arrest of the contractor for frittering away public funds and asked that the EFCC and ICPC should investigate the scam. He also thanked Mr. Lawani for blowing the whistle on the contractor, without it, the government would not have known. He encouraged citizens to ask questions about and monitor the quality of service the government is giving them as it is their right to do so.

     

    From the foregoing, it is evident that Abia and Edo are two administrations in the same country approaching the issue of governance differently. One does not need a soothsayer or analyst to determine that they would achieve different results. The first point to note here is that leaders must realise that they are accountable to the people. Power, they say, belongs to the people. When you muzzle the people or intimidate them such that they cannot ask questions of the government, then the collapse of that Administration is near.

     

    Secondly, it is by asking questions that the attention of government is drawn to issues that it might not have paid attention to. It also encourages dialogue and communication. Except in a despotic government, people must be allowed to express their opinions. The saying that “when you drive people away from the arena where opinions are expressed, they only go to converge at the cellar where revolutions are born” cannot be more apt in the Abia situation. It is also in this light that one fails to see the reason behind all attempts being made by government to regulate the social media and all other forms of communication. Opinion must be free, and people should be allowed to express them. Again, throughout history, attempts to focus on the messenger and not the message have not worked and cannot work in this instance. The only thing is that those who attempt, temporarily take away attention from the subject while the subject refuses to go away.

     

    I must therefore commend Governor Godwin Obaseki for encouraging his citizens to participate in his government by asking questions and also for swiftly dealing with the subject matter. On the other hand, I am still asking Governor Okezie Ikpeazu to provide answers to my questions about the Abia Paris Club refunds as he immediately begins to pay workers who he is owing. I also will like to draw his attention to the unlikely event of a court pronouncement compelling the government to make those payments since there is an existing contract signed, despite its unreasonableness. This must not be allowed to happen. This is the reason why he must put up a serious appearance at the court and assure Abia Citizens that no such judgement would be procured by the so-called contractors.

    Permit me to use this opportunity to wish my Muslim readers a happy Eid El Kabir as they observe the Sallah Celebrations this week.

     

     

  • Ex-APGA guber candidate in Abia, Otti joins APC

    Ex-APGA guber candidate in Abia, Otti joins APC

    Dr Alex Otti, former governoship candidate of the All Progressives Grand Alliance (APGA) in Abia in 2015 and 2019 elections has declared for the All Progressives Congress (APC).

    Otti, who made his declaration on Friday at his Ehi na Uguru Ward 5, in Isialangwa South Local Government Area, promised to keep fighting to salvage the state from the grips of endless bad governance.

    Otti said he was joining APC for the good of his people, saying “we must always put the people first.”

    He said that his decision to leave his former party, APGA, was not an easy one, neither was it one that he made overnight.

    According to him, it was a decision made based on my unshakable belief that it is for the good of my beloved state and people of Abia.

    Otti said that he was joining APC alongside about 450,000 members of APGA, who were loyal to him.

    He decried the level of insecurity, decayed infrastructure, unemployment, unpaid salaries and pensions, endemic poverty among others as some of the challenges crippling the state.

    Otti expressed dismay that the state now occupied a very low position in the ranking of states in the Human Development Index because of bad leadership.

    He said, “I have, therefore, chosen to keep on fighting in order to liberate our people and make them achieve their full potential as human beings and rightful citizens of Nigeria and the World.

    “As our people say, if you embark on a journey, you must be walking until you get to your destination.

    “We have not arrived yet, so we keep walking. We are a great people and we know it. It is our destiny.

    “It is the great task of our lives.We must lead our people to the promised land.”

    Otti, a former Managing Director of the defunct Diamond Bank Plc, pledged to use his vast experience and contacts in the finance and management industry to attract massive investments to industrialise the state.

    Earlier, Mr Nnamdi Francis the Ward 5 Chairman of APC, while presenting Otti to the party, described him as a ‘big fish’, who would help to repostion the party in the state.

    The News Agency of Nigeria (NAN) reports that Otti was later welcomed at the party’s state secretariat in Umuahia, by the APC stakeholders.

    Chief Donatus Nwamkpa, the state Chairman of APC, while welcoming Otti said there was no discrimination in the party.

    “We have always longed to have you in our midst because our mission is to rescue Abia,” he said.

    Nwamkpa however, said that APC had no automatic ticket for anybody.

    He told Otti that every member of the party was important, while assuring him that he would not suffer any form of discrimination in the party.

  • Why I’m running against Ikpeazu again in 2019 – Otti

    Dr. Alex Otti, a former governorship candidate of the All Progressives Grand Alliance (APGA) in the 2015 general elections in Abia on Friday declared his interest to run again in 2019.

    Otti, a former banker and renowned financial expert, told a mammoth crowd of his supporters at the Ngwa High School, Aba, venue of the formal declaration, that he would seek election as governor in order to restore Abia to the path of growth and socio-economic development.

    “I have decided to contest again for the governor of the state because the Pharoahs of Abia must be forced to let Abians go free.”

    Otti debunked the rumour that APGA had two factions, saying that it was sponsored by the enemies of Abia and APGA.

    He gave a detailed narration of how the mandate given to him in 2015, was allegedly stolen but warned that such daylight robbery would never happen again.

    He appealed to the electorate, especially the youths, to rise to the challenge and defend their vote in 2019.

    “You all should rise to defend your vote. This is a collective responsibility. When you do your bit and we do our own bit, it will be impossible for anyone to rig the election.”

    Otti said that the outcome of the election in Ekiti last Saturday showed that it had become difficult for anybody to rig elections in Nigeria again.

    According to him, “the Independent National Electoral Commission ( INEC ) has improved on the electoral process and has made it difficult for anybody to rig elections again.”

    He decried the inability of the Gov. Okezie Ikpeazu-led administration to address the infrastructure deficit in the state and ensure regular payment of pensions and salaries.

    In his speech, the former National Chairman of APGA, Sen. Victor Umeh, said that it was obvious that Abia people gave their mandate to Otti and APGA in 2015.

    Umeh alleged that the mandate was stolen but assured the electorate that the 2015 experience would not happen again.

    He said that APGA was strategic for Ndigbo because it was the only party that would bring enduring development to the area.

    “Igbo land must be made better through the placement of respected and upright men and women in positions of political leadership in the zone.”

    He urged the Abia electorate to be vigilant in 2019 “so that you do not allow the electoral robbery of 2015 to repeat itself.”

    The Deputy Governor of Anambra state, Dr. Nkem Okezie, who represented Gov. Willie Obiano at the rally, thanked the Abia people for their relentless support to Otti and APGA.

    Okeke promised that the people and government of Anambra would rally support for the party in Abia in order to ensure its victory at the polls in 2019.

    The state Chairman of the party, Rev. Augustine Ehiemere, said that the party would leave no stone unturned in 2019 “to reclaim its stolen mandate.”

    He said that the party would put an end to godfatherism in Abia as it did in Anambra.

    “This is to ensure that the state moved forward like its sister-states in the South East.