The Alternate Road to Vision 20-2020 – The Role of Legislators 2

A lot has been said about diversifying our economy and that is where the Nigerian economists lose me. Diversify what? The Nigerian economy is over diversified for all I know. But, if what they mean is to diversify the funding of the public treasury away from the proceeds of oil, they could be making sense. Lately, many Nigerians are becoming aware of the monster called the civil service that unproductively consumes over 80% of Nigeria's oil receipts. The key to this assertion is if our legislators too will start seeing that way. It is not much of how government spends its money, but how the public treasury is funded by naira, the local currency – if you get what I mean. Unfortunately, many Nigerians like I do are obstinate. This, we have displayed by our refusal to revisit the manner we fund the public treasury since 1986 - the argument for market forces, notwithstanding.

Twenty three years ago, we embarked on a journey to auction the oil receipt to the highest bidder. It was thought to be an equitable way to distribute the oil wealth and allocate resources. Its proceeds after conversion to naira thus fund the national public treasuries of the country. There have since been proven tales of economic decline, which if either by coincidences or hard facts of economics have led to brain drain; agricultural output decline; reduction of industrial installed capacity; decline in the quality of education; infrastructural decay and the emergence of subsidies in critical areas. All these have coincided with the introduction of the auctioning of the petrodollar to the highest bidder. There have also been massive joblessness and heightened corruption in the society which many Nigerians see as the main problem. It could just be a by-product of the economic system.

With due respect to the supporters of this unproductive method of funding the national treasury, a revisit I think, would not be out of place. What we seem to be doing, ever since, is to patch what is not patchable. The banking sector, which happens to be in the forefront of the conversion of the oil receipt to the naira, has witnessed the greatest fraudulent activities. For as long as the most vital component of our economy, the oil revenue, is converted to naira through the method of auctioning, there will always be imagined subsidy; depressed productive sector and unprecedented corruption in the society. What informs the auctioning of the petrodollar in the first instance was the inability of government to fund the public activities through the traditional taxation.

I reiterate, like I have done repeatedly, that unless the National Assembly wades in by passing a bill that sets a goal of zero-oil receipt to fund public recurrent expenditures in the next six years, the road to 20-2020 may be long and bumpy. In doing so, the executive arm of government would be made to fund the recurrent activities through the traditional tax system. With less desperation on the part government, it could lead to a formulation of allocation of the forex to the productive sectors. As it is, our oil revenue supports mostly massive importation of finished products with little regards to further wealth and job creation. Man, they say, is the greatest mover of development. I believe also that for optimisation, man should have the freedom to pursue any economic goal. That is the tenets of capitalism which to some extent is the best economic system.

However, man, if not coordinated and is allowed to range unchecked would ruin everything for everybody. The present worldwide economic recession is the product of the freedom that allows man to range on the economic plain unchecked. When you auction any "valuable," you have technically lost the right to direct where it ends up. By auctioning the petrodollar to the highest bidder, the country loses the right to direct the needed petrodollar in the direction of further wealth production. It is on record that as high as 80% of our petrodollar ends up funding the importation of finished products, whilst the wealth producing sector (agriculture, manufacturing and education) has been out priced at the forex auction market of the Central Bank. I doubt if this is the intended resource allocation.

Twenty three years to date after the introduction of our present economic system, particularly the methods of funding the public sector, the result has been dismal. Could we at least start talking about it, instead of trying to patch a system that has only produced commissions for the traders? This mercantile option remains the least employer of labour. To produce additional wealth that will guarantee employment for Nigerian youth on our agricultural plains; and in our factories; and a qualitative wealth of knowledge through education, we will need to bias the oil receipt towards the productive sector. Nature has been nice to us, but not using it to multiply our national wealth, is to me a reckless endeavour and we should be talking about it. Many Nigerians are fixated on corruption as if its eradication will be a magic wand. We do not realise that it could just be one of the by-products of the way we fund our public treasury.

This plea may sound boring, but nothing else is exciting – come to think of it. Commissions are what we generate when we buy and sell goods because it does not add value to the goods and this is not sufficient to feed a large population like Nigeria. We need to create additional wealth in the land, in the factories and in our schools, but this cannot be achieved by spending a chunk of our oil revenue on importation of unnecessary goods which is made possible by easy access of the oil receipt to the trader who is ready to pay any amount of naira for the dollar. Anytime I drive pass and see the array of used and new vehicles lining the major streets of our cities for instance waiting for buyers, I lament for this country. These are huge resources recklessly allocated that ought to have come back to the land as raw materials and machinery to multiply our oil revenue on the factory floors, with massive employments for our youth in the bargain. There should be a rethink definitely.

Samuel Akinyele Caulcrick