As several candidates’ jostles for the position of their party’s Presidential ticket to become the President of Nigeria come 2023. Beyond party politics, the candidates should strive to represent their parties based on practical knowledge of the fiscal governance challenges requiring urgent intervention. The candidate should articulate solutions bothering on reviving the economy as well as setting it on the path of sustainable growth. This is very important considering the trajectory of Nigeria’s economic downturn and its rippling effects on the citizens. For instance, the value of the naira is uncontrollably low. Currently the naira exchanges at almost 600 naira to one dollar.
The prices of goods and commodities in the market are beyond the reach of the common man with a double digit inflation rate of about 15%. Another disturbing scenario is the declining revenue profile of government with an annual deficit expenditure, which gulps 50 percent of the budget. Measures utilized by successive governments to salvage the economy have not yielded the expected results. Nigerians would want nothing more, than a candidate who understands the scenarios highlighted and who is ready to bring on board, innovative solutions to address them.
In the light of the Fiscal Responsibility Act 2007, interested candidates should be equipped with the provisions of this law. The law provides for prudent management of the Nations resources, ensure long term macro-economic stability of the national Economy, secure greater accountability and transparency in Fiscal operations within the Medium Term Fiscal Policy Framework, and the establishment of the Fiscal responsibility Commission to ensure the promotion and enforcement of the Nation’s Economic objectives; and for related matters.
It has provisions for the Medium Term Expenditure Framework MTEF. In preparation of the MTEF, the incoming candidate should be ready to work with sector experts and mainstream their inputs, in the macro-economic framework and policy decisions for the medium term as provided in section 13 (2) of the FRA. Previous administrations have prepared the MTEF in isolation, without seeking the inputs of sector experts. This may also be responsible for the failures of successive governments in the economic growth and sustainability of the nation.
On debt management, Information obtained from the website of the Debt Management Office, shows that the country’s current national debt stock is in the region of forty trillion naira. Nigerians expects to get a Presidential candidate who would not continue on the path of borrowing, but one who has solution to take Nigerians out of the pillage of debt. Incoming candidates should be abreast with the provisions of the Fiscal Responsibility Act.
The FRA sets the debt limit to not more than 3 percent of the Gross Domestic Product. Incoming candidate would be required to work with the sub-national government to keep the debt ratio within reasonable limits. In worst case scenarios, where borrowing remains the only alternative, such borrowings should have low interest rates and reasonable long amortization period and such must be channeled towards capital projects.
On addressing the revenue shortfalls plaguing the nation, Nigerians need a presidential candidate that would go beyond giving excuses of lack of funds to fulfill its promises, but a candidate who has practical measures to increase Nigeria’s revenue. Such a candidate needs to look beyond crude oil. For decades, Nigeria has relied solely on crude oil, as its major source of revenue. It is only recently that attention is being paid to the non-oil sector. However income generated from the non-oil sector is still not enough to cushion the revenue shortfall currently experienced in the country. Nigerians expect a Presidential candidate who understands the dynamics of global politics and who knows how to harness the nation’s internal resources to earn more foreign exchange for the country. Such a candidate should as well bring up innovative ideas on how to increase internally generated revenues of the country.
To avoid leakages in government revenue, the candidates would need to implement the amendment of the FRA to empower the Fiscal Responsibility Commission. Such empowerment would enable the Commission enforce remittances of operating surpluses by government owned enterprises to the consolidated revenue fund. S.22 of the Fiscal Responsibility Act mandates government owned corporations to establish a general reserve fund and allocate one-fifth of its operating surplus for the year. The balance of the operating surplus shall be paid into the Consolidated Revenue Fund, not later than one month following the statutory deadline for publishing each corporations account. Unfortunately most governments owned corporations are failing in this regards. The candidate should seek that the FRC is empowered to punish erring corporations who fails to remit their operating surpluses.
Finally, still on revenue leakages, incoming candidates would be required to expand the tax net as well as curtail tax frauds. Companies who make huge profits but do not pay the required tax must be identified and made to face the full wrath of the law. Also tax waivers illegally awarded to companies without recourse to due process must be curtailed to achieve economic growth.
Public Affairs Analyst/Good Governance Expert