At the 2017 graduation of the Nigerian Institute of Policy and Strategic Studies, in Kuru, Jos, on Saturday, Vice President Yemi Osinbajo reeled out the various achievements of the Buhari administration, despite scarce financial resources, made more difficult by the squandermania of the Jonathan era.
He noted among other things, that despite the fall of revenue by 60 per cent, the Buhari administration started a series of bailouts for the States, to enable them pay salaries and pensions. The government was also able to provide about N1.3trillion for capital expenditure, the largest amount for capital in our nation’s history.
“For the first time in five years we saved $500million, and invested another $500million in the Sovereign Wealth Fund. Today our external reserves stands at $35billion the highest in the past four years.
“We must pay attention to what we are seeing today, and some of the shameless noises of those who brought our nation to its knees, many of whom still have looted funds in their possession, trying to rewrite history and hoodwink the populace again. We say never again.
I am going to focus on the economy, where we are, and where we are heading in the next 12 months. What are the policy choices we have made? Why have we made those choices? Are those policy choices working?
From the very beginning of our administration when Mr. President asked me to head the economic management team, he made it clear that in his view, the major reason for the slow development of our nation and the poverty of millions of our people, was corruption and mismanagement of public funds & resources. And that fighting corruption and mismanagement of public resources was as much an economic imperative, as it was a law and order issue. I agreed.
We, from that point, put in place structures that would ensure prudent and transparent management of resources. In July 2015, the President ordered that all MDAs funds should be paid into the Treasury Single Account. This ended years of MDAs keeping secret bank accounts, in some cases putting public funds in fixed deposit for interest far below market rates. Banks would then lend money back to government by buying treasury bills at substantially higher interest. Today, government knows exactly how much we have, and we are saving significantly.
Early in 2016, an Efficiency Unit was set up under the Federal Ministry of Finance to reduce wastage, plug leakages and foster greater fiscal transparency. The Efficiency Unit has enforced several deliberate cost-cutting measures including the removal or reduction of sitting allowances for civil servants in many cases, and saved over 1 billion a year, stopping the procurement of souvenirs, and printing for government programmes, we saved another N1billion.
By reviewing travel expenditures, and negotiating procurement discounts, we saved N15billion. We have also removed or reduced meals and refreshments for meetings, and saved another N1billion annually.
We stopped the siphoning of funds through ghost workers by insisting that all MDAs must be on the Integrated Payroll and Personnel Information System (IPPIS) across government, and also mandated the use of BVN. Over 461 Federal MDAs have been captured on the system thus far, with the objective being able to enrol all of them. We are now saving N25billion a month, from cleaning up the payroll in this way. The President has also ordered all Armed Forces personnel to be captured on IPPIS.
It is important to understand, what these measures to block leakages and stealing of public resources mean for economic performance. I will demonstrate that impact.
When we came into office, over 22 States were owing salaries. They were owing despite the fact that between 2011 and 2015, Nigeria earned its highest ever revenues from oil. Oil was selling at between $100 and $115 a barrel. Yet reserves between 2014 and 2015 fell from $35billion to $28billion in April 2015. When we came into office, oil prices fell as low as $28 a barrel, the unrest in the Niger Delta, especially the vandalization of pipelines and oil and gas assets reduced the production at some point by over a million barrels a day. Revenues dropped by as much as 60%.
But with 60% less revenue, we started a series of bailouts for the States, to enable them pay salaries and pensions. With 60% less revenue, we were able to provide about N1.3trillion for capital expenditure, the largest amount for capital in our nation’s history.
For the first time in five years we saved $500million, and invested another $500million in the Sovereign Wealth Fund. Today our external reserves stands at $35billion the highest in the past four years.
We have made the point, that Nigeria is not poor because it has no resources, it is poor because a lot its resources are stolen or mismanaged. We can do a lot more with far less, if we don’t allow stealing.”