One of the campaign promises that the APC made to Nigerians was the pledge that they would implement a conditional cash transfer (CCT) scheme for unemployed youths. They also committed themselves to implementing a school feeding programme for schoolchildren. If recent media reports are anything to go by, it would seem that government is going to factor the two schemes into the 2016 budget estimates which are currently under preparation.
To be transparently honest, I am one of those who have learned to be rather wary of populist schemes. They may sound cool during electioneering campaigns – and may even get votes. But then, most politicians know that such promises are not always meant to be made good of. When a new government feels obliged to fulfil its electoral promises, we must applaud.
However, I have had my fair share of gallivanting across the world and I happen to know that entire nations have been brought to ruin through populist good intentions. This has been the lot of countries as wide apart as Cuba, Argentina and Venezuela. Those countries have been run aground through leaders who had their hearts in the right place but did not marshal the mental acumen to think things through to their logical conclusions before embarking on their misguided follies. This is really my worry about the proposed CCT and the school feeding programme.
On the face of it, they seem laudable and beyond reproach. President Muhammadu Buhari, I am aware, is a man of deep compassion for the benighted and long-suffering Nigerian people. He himself has passed through the fiery furnace like the Hebrew prophet Daniel of old. In the course of pursuing the presidency, he had, on more than one occasion, escaped the grim reaper by a hair’s breadth. He is the quintessential profile in courage. The masses kept their covenant with him through thick and thin. He knows this. It is inevitable that he would want to keep his rendezvous with them. You can’t fault that.
My real worry is this: Have we done the relevant sums, meticulously weighing the costs against the benefits? Have we put in place the right policy frameworks and the requisite institutional mechanisms to drive the process? Is it the current Nigerian bureaucracy as we know it that is going to implement the scheme or are we to expect a deputation of angels from heaven who will come down to help us implement the programme? If civil servants cannot be trusted to keep their mouths off the trough of people’s pensions, is it free cash meant for the poor that would escape their devious grasping stratagems?
Let us do the arithmetic. The proposed CCT aims to provide the sum of N5,000 on a monthly basis to some 24 million unemployed youths. That works out to a monthly bill of N120 billion. For a total of one calendar year, the bill stands at the order of magnitude of N1.44 trillion. This is virtually equivalent to all the amount that was saved from the recent migration of public funds from the commercial banks to the new Treasury Single Account (TSA) domiciled in the CBN.
And we are not done yet. One would imagine that the school feeding programme might involve a cohort of 10 million pupils throughout our great country. At a conservative cost of N200 per child, the daily bill would amount to N2 billion. For a five-day week, that would amount to N10 billion. Assuming a school year of 60 weeks at N10 billion a week, we are talking of N600 billion annually. Whilst I am aware that a school feeding programme can be a great boon to local farmers, it is not without costs. The sum of N600 billion in feeding costs added to the estimated N1.44 trillion in cash transfers gives a whopping cost of N2.04 trillion. We have ignored, for now, the administrative costs of managing the entire scheme, which can easily add 10 percent to the total bill.
Considering that the 2015 federal budget stood at a total of N4.358 trillion, the bill for the proposed social welfare package will amount to nearly a half of last year’s budget. The simple question one would ask is: where is this money going to come from? Who will pay for it? What would we have to forego in order to fund this expensive social experiment? And would the opportunity costs be prudentially and morally justifiable?
Okay, we hear that government is attempting to come up with a 2016 budget that would virtually double that of last year at N8 trillion. We also hear that PMB is determined that the egregiously skewed dominance of recurrent expenditure over capital expenditure (averaging 20/80) is going to be reversed. Sounds like music to my ears. But at the same time, I am yet to be satisfied that we know where all the money is going to come from and that we have done our sums correctly.
Given all these unanswered questions, I would really urge that we proceed cautiously with the proposed social security scheme. Before any country embarks on an ambitious social protection scheme such as this, serious analytical work needs to be done. In Europe social welfare is unthinkable without firm understanding of every single beneficiary – who they are and where they live –the full profile of their social conditions.
In Britain, the Social Security Number is issued at the moment a child clocks sixteen. It is considered more important than having an international passport. It is the one ID card that no citizen could do without. It provides information about your age, gender, where you live and so on. And that number is unique to you from the cradle to the grave. Without a Social Security Number, no British citizen or resident could be entitled to any form of welfare whatsoever, including access to the National Health Service and other social services.
In our own case in Nigeria, the question of population has been so politicized that the whole thing has become a humongous scam. The first law of the state in all civilized societies is to know who your citizens are and where they live. Without it, law and order, the first responsibility of government since Aristotle, would be a non-starter. Nobody can even tell you who is a true Nigerian anymore. In all our border towns, youths from neighbouring countries wonder across the borders and become automatic citizens, having naturalized, as it were, with their feet. Many of these wandering beggars have no real place of domicile. Many of the crimes in Lagos and the south west are committed by Beninois and Togolese people. More than a sizeable proportion of the Boko Haram murderous hordes are from neighbouring countries. This is why they operate with such total contempt for human life. When they open their mouth to speak Hausa, we Hausa speakers know automatically that they are neither from Sakwatto nor from Kano or Zazzau. It would amount to an act of sacrilege to provide social welfare to such aliens.
I am deeply concerned that some form of social protection is absolutely necessary if ours is to become a sane and civilized society. But I am jealous for my people and my interest and loyalty is to Nigeria first. In all the countries where social protection has been undertaken with success, such schemes are rigorously thought out from beginning to end. Singapore and Brazil come to mind.
Singapore has been one of the great success stories of our epoch. Much of this success owed to the vision, courage and bold statesmanship of the late Lee Kuan Yew, the city-state’s founding-father and long-term Prime Minister. Today, Singapore is a prosperous first-rate technological state with a per capita income of US$53,000. The city-state has successfully implemented an effective welfare system that builds on existing familial social capital. Every Singaporean has access to a good education, housing and health services. Students are able to access grants as well as affordable educational loans. The unemployed benefit from a means-tested, time-bound welfare system that is rigorously monitored. Singapore has avoided the iniquitous welfare traps that have kept black people and poor whites in conditions of permanent poverty in America and Europe. Lee Kuan foreswore his countrymen and women ever becoming hand-out dependent welfare slaves.
Brazil is another example of a successful social protection model. The building blocks were laid by President Fernando Henrique Cardoso during the years 1995-2003. Cardoso was one of the most brilliant Brazilian exile professors at the Sorbonne during my days as a graduate student in Paris. He went back to Brazil to pursue an illustrious career that took him to the summits of the High Magistracy of his country.
Cardoso turned out to be a great social reformer and far-sighted statesman. He applied his forensic skills as a sociologist to diagnose the dynamics of race, class and poverty in Brazilian society. He gave close attention to the favelas in cities such as Rio de Janeiro and Brazil and Recife. He also looked into the situation of the rural poor in Bahia, Minas Gerais and other depressed areas. He raised rather uncomfortable questions about topics that succeeding power elites had considered totally anathema. He was determined to change the idiom of political discourse on the economic and social problems facing his country.
The lot fell on his illustrious successor Luiz Inácio Lula da Silva to kick-start a comprehensive social welfare scheme for millions of poor Brazilians during the years 2003–2011. The Bolsa Familia is a conditional social transfer scheme that was directed principally at poor families. It was conditional on the parents ensuring that their children remain at school. The other pillar of Brazilian social policy was the Zero Hunger Programme. It is based on the simple premise that no Brazilian child should ever go hungry at night. The poorest families are provided with coupons to buy food. This is linked to a school feeding programme that ensures that every child enjoys a balanced meal during the school day. If a child fails to turn up at school, the payments are cut off automatically.
It was my singular honour and privilege to have met President Lula’s Minister for the Zero Hunger Programme, the agronomist Dr. José Graziano da Silva. He is currently Director-General of the Rome-based UN Food and Agricultural Organisation (FAO).
As a result of these policies, more than 20 million Brazilians were taken out of poverty within the space of a decade. For the better part of a century, Brazil was the proverbial Third World basket case; a country where nothing happened – a nation blighted by racism, social oppression and grinding poverty. That Brazil is today considered a beacon of democracy and social progress owes in large part to the farsighted policies that were put in place by President Cardoso and his successor Lula. Brazil’s social protection policies succeeded because they first had to put in place the necessary macroeconomic reforms and the necessary institutional frameworks.
The social transfers are also rigorously monitored. Nothing is left to chance. Any potential sources of rent-seeking and financial leakages are rigorously plugged. Brazil operates a world-class merit-based civil service. The civil servants who manage the social welfare programmes approach their vocation with a high sense of mission. It is by no means a perfect system. But it works. Brazilians are today a much happier people than they have been for the better part of a century.
What are the lessons for us? It is crucially important that we learn to put the horse before the cart. You do not just wake up one morning and tell the world you are going to feed 24 million hungry mouths. You to build the necessary institutional infrastructure while putting in place the right policy framework and effective accountability and control systems as fundamental prerequisites and critical success factors. You also have to delineate the social group that is your target, mapping out the geography and physiognomy of poverty. In the context of Nigeria, I would start with a pilot scheme, say, in the Niger Delta and the war-torn region of Borno and the north east. I would see how that works for a year and then we would gradually replicate the model if it proves successful, while adjusting the model as we go along to ensure impact and effectiveness.
As we speak, the current administration does not as yet have an overall macroeconomic blueprint. Economic policy is being made on an ad hoc basis. We have to be forgiven if the proposed CCT seems to us like one of those fads being plucked out of a hat like the gimmicks of a roadside magician. It has no basis within the overall framework of a coherent macroeconomic policy.
Our Nigeria of today faces what I would term a “perfect storm”. The collapse of global petroleum prices means we simply cannot afford the current rentier political economy that has made us behave with the licentiousness of drunken sailors. We really must wake up to the reality that the world does not owe us a living. We are often boastful about being the so-called “the giant of Africa”. There is some snob value in being counted as numero uno in GDP in our beloved continent of Africa. But if size alone was all that mattered, dinosaurs would still be howling across the ancient savannah and primeval rainforest of our ancestral homeland.
The greatest folly that we could possibly contrive would be to create a new entitlement mentality that ends up entrapping millions of our young people into a new slavery. When faced with the dire social conditions engendered by the Great Depression in the 1930s, President Franklin Roosevelt reminded Americans of their grandeur and nobility as a people. The focus was not on welfare, but on how to rebuild America and create value. He sounded the battle-cry of a new historic summons to the American people to rise up and reclaim their destiny among the great ones of the earth. He did not whine about the state being broke”. Rather, he inspired a new sense of hope among a frightened and dispirited people. He built new dams, power stations, railroads and great public works, deploying millions of people through the public works systems that he established. It was not too long before the American people were back on their feet again.
Perhaps we could borrow a leaf from the great Franklin Delano Roosevelt. Could we get 10 million Nigerian youths to work on the power sector and infrastructures such as railroads and highways based on the public-works model? If we ploughed N2 trillion annually into the power and infrastructure sector using the public works model would we not achieve more effective employment as well as infrastructures development than what we are trying to do right now through a poorly thought-out system of welfare handouts? Would that not make more sense than creating another wasteful pork barrel that would encourage idle consumption and a false sense of entitlement rather than work that adds value and builds the national wealth on a long-term sustainable basis?
Obadiah Mailafia
