At the recent ministerial briefing on the 2021 federal budget, the Minister of Finance, Budget and National Planning, Zainab Ahmed, stated that the Federal Government would sell some government-owned assets to fund the 2021 budget. She said the assets would be sold to the private sector because they had become moribund and could no longer be managed by the Federal Government. However, she did not mention the assets slated to be sold. The plan came on the heels of binge borrowing from domestic and external markets. Already, the N13.58 trillion national budget has a deficit of N5.5trillion, representing about 67 per cent of the revenue estimates while N3.3trillion or 25 per cent is appropriated for debt servicing.
There is no doubt that all of this has put pressure on government to raise additional funds to finance the budget, either through more borrowing or outright sale of some critical national assets. Earlier, the government has planned to borrow N850billion from unclaimed dividends and dormant account balances of individuals and corporate bodies under the Special Trust Fund. The move, the Finance Minister explained, followed the need for cheap funds to mitigate further economic crisis arising from the COVID-19 pandemic that has had a great toll on the economy and livelihoods.
State governments also made moves to borrow trillions of naira from pension fund, a plan that has been strongly opposed by stakeholders across the country. Besides, the plan to sell national assets to fund 2021 budget is reportedly anchored on the 2020 Finance Act (Amendment) Bill signed on December 31, 2020, by President Buhari. It provides, among other things, that the Debt Management Office (DMO) shall supervise the operations of the fund.
Expectedly, many Nigerians have slammed the government over the plan to sell critical national assets to fund the budget. We caution against it because there is no guarantee that the process will be transparent and the proceeds judiciously utilised for the purpose. Therefore, government should listen to Nigerians on the issue and stop forthwith the sale of the assets. Government should be creative and seek alternative means of generating more revenues other than the sale of important national assets. The government must not rely on idle funds and dormant accounts to fund the budget or execute some developmental projects.
Doing so will be counter-productive. It should go back to the drawing board and think of pragmatic ways to generate more revenues. Moreover, the assets are our national heritage that should not be tampered with in the guise of raising revenue for the budget. Our experience with the privatisation of the defunct Nigerian Electric Power Authority (NEPA), Nigeria Ports Authority (NPA), Nigeria Telecommunications, among others, does not recommend further sale of our national assets. Instead of selling them, government must learn how to profitably manage the assets. Government should also think of how to tackle growing poverty and unemployment among Nigerians. It is sad that Nigeria is the poverty capital of the world, with an average of 19,000 people drifting below the Global Poverty Index (GPI) per day and home to the third largest unemployment rate, with about 105 million people unemployed. The situation is worsened by rising debt stock, insecurity, high cost of governance and corruption.
Let the cost of governance be drastically reduced. To this end, government must cut salaries and allowances of public officeholders, increase tax on luxury goods, as well as curb corruption in many government’s Ministries, Departments and Agencies. We also enjoin the government to seek help from experienced professionals in formulating policies and managing the economy. There is need to vigorously diversify the economy by investing in areas that are yet to be explored.
While seeking alternative sources of revenue, the government should try to rebuild trust in the citizens. In all, government should come up with effective measures to save the economy. In this respect, the National Assembly has a constitutional and oversight responsibility to protect valuable public property and ensure a responsible budget spending. It can do that now by reviewing and repriortising certain areas in the 2021 budget.