Omiete Blessing
As Nigerians continue to lament hardship, a non governmental organisation under the aegis of Rivers State Tax Justice and Governance Platform, has demanded accountability in fuel subsidy savings and sincerity of purpose in fulfilling the government’s promise of renewed hope to the people.
The group made the demand, during a media chat organised in Port Harcourt, in collaboration with Christian Aid (CA) and the Civil Society Legislative Advocacy Center (CISLAC).
Speaking on the theme: “Nigeria’s Economic Challenges and Public Debt Management”, the Coordinator of Rivers State Tax Justice and Governance Platform, Mr Amaechi Kelechi, narrated “The trajectory of revenue from the federal government shows a continuous decline in the past 5 years with a 45% revenue shortfall in 2018, a 45% shortfall in 2019, 31% in 2020 and 45%, 41% and 50% in 2021, 2022 and 2023, respectively”.
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He said “These revenue shortfalls have created budget deficits that have precipitated our debt crisis that has grown our external debt by 1,333% from the level it was after the Paris Debt buy-back-deal in 2005/06”.
According to the group “As of June 2023, Nigeria’s total debt portfolio stood at N87.9trillion ($114.3billion) and will climb to N107.38 trillion in 2024, following recent approvals by the National Assembly.
“Worrisomely, 37% of Nigeria’s total external debt figure is owed to private creditors whose loans attract between 6-9% and shorter repayment period in comparison to loans from multilateral and bilateral sources with interest rates of between 1-3% and longer repayment period of 10-30 years.
“The result is that debt servicing will cost 98% of our budget, and the government will spend six times more on servicing debts than on building new schools and hospitals in 2024.”
Following the narration on how the country has accumulated so much debt, Kelechi said “The escalating debt burden has profound implications for the wellbeing of Nigerian citizens, and failure to act quickly could result in an additional 23 million Nigerians living in poverty and 80 million working-age citizens without a full-time job by 2030”.
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Calling on the National Assembly to urgently commit to sound reforms and balanced resource allocation, the group expressed the believe that it will pave way for significant investment in critical sectors that directly impact the lives of vulnerable Nigerians.
“In response to these multifaceted challenges, the National Assembly, as stewards of the nation’s economic wellbeing, should acknowledge the critical importance of exercising their mandate towards steering the nation back on the path of economic recovery, stability and prosperity.
“Our recommendations aim to mobilize adequate legislative responses that would strengthen debt management, enhance revenue mobilization, plug leakages and prioritize government spending in critical sectors”.
To reduce the amount of indebtedness and tackle the economy challenges faced by Nigerians in recent time, the group recommended that government should stop borrowing for recurrent expenditure (personnel and overheads) and dilatory capital expenditure that adds no value to economic growth, wealth creation and development.
They also demanded for “Harmonisation of tax laws and rates to reduce overlaps and inconsistencies, eliminate multiple taxation and improve tax revenue mobilization. Nigeria should adopt a comprehensive approach to taxation which categorizes taxes to income, consumption and property tax.
“Introducing appraisal mechanisms that ensure budget performance is a reflection of the value created and not indication of funds released to MDAs.
“Prioritizing spending on policies and programs that will directly affect the general public, especially the low-income earners, such as investing heavily in education, health care, agriculture and future-proof empowerment programmes in a transparent, accountable and sustainable manner.
“Demanding accountability for petrol subsidy savings and sincerity of purpose in fulfilling the government’s “promises of renewed hope” to the millions of Nigerians who no longer have belts to tighten”.
The group however, called on senators and Members of the Federal House of Representatives (NASS) from Rivers State to mobilise support for the recommendations as bastion of the people.
