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Nigerian politicians squander N118.2 trillion in 12 years, incur N10trn debt in 10 years

By News Express on 02/02/2016

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Blundering Nigerian politicians inflicted the present economic crisis on the nation by squandering a whopping N118.2 trillion ($600 billion) during the 12-year period, January 2005 and December 2016. They, in addition, have mortgaged the country’s future by incurring debts to the tune of over N10trn (about $50bn in 10 years (June 2007 to December 2016).

These are the claims of the International Society for Civil Liberties & the Rule of Law (Intersociety) as contained in a statement issued today in Onitsha, Anambra State.

“Nigerian political leaders holding forte at the Federal, States, Local Government and Federal Capital Territory have between January 2005 and December 2016; a period of 12 years, squandered a whopping sum of N118.2 trillion or $600 billion,” the group said in the statement signed by the Board Chairman Emeka Umeagbalasi, and Head, Democracy & Good Governance Programme, Chinwe Umeche, Esq.

“The squandered public funds,” according to Intersociety, “are made up of generated and borrowed funds secured for the purpose of budgetary expenditures in all of the country’s public offices, between January 2005 and December 2016. The political leaders under reference include the Federal authorities, the authorities in charge of the country’s 36 States and 774 constitutionally recognised Local Government Areas (LGAs) as well as the authorities of the Federal Capital Territory (Abuja); numbering 17,500, made up of elected and appointed public office holders in the executive, legislative and judicial arms of government.”

Continuing, the statement said: “The political authorities under reference, have also between June 2007 and December 2016; a period of  ten years, incurred staggering public debts of over N10 trillion or $50 billion from local and international sources; comprising States and Federal Government’s local and foreign loans. Nigeria’s official or public total debts as at May 2007 stood at $23.5 billion; comprising local debts of N1.8 trillion ($20 billion: 140.00/US$) and foreign debts of $3.5 billion. This was after its $30 billion foreign loans were liquidated in 2006 courtesy of Dr. Ngozi Okonjo-Iweala and leading international lending institutions.  But by the end of December 2016, Nigeria’s current total public debts must have risen to over N14.6 trillion or $73 billion. The Buhari’s federal Presidency alone has proposed a public borrowing of over $9 billion or N1.84 trillion in the 2016 budget proposal. Average of 20%-30% of 2016 budget proposal of each State in Nigeria is also expected to be funded from local or international borrowings.

“When added, the country’s total official or public debts will be raised to as much as $80billion or N16 trillion by the end of December 2016. The country’s current official public debts as at June 2015 were quoted by DMO as “N11.1 trillion or $63.8 billion”, using old official exchange rate of N155/US$. This is no longer fiscally realistic. Crookedness is also associated with government local borrowings in Nigeria; making it difficult for DMO to appropriately capture every kobo borrowed locally particularly by State Governments. As a matter of fact, totality of public borrowed funds in Nigeria both openly and illicitly borrowed; is strongly believed to be in the neighborhood of $80 billion to $90 billion or N18 trillion or even more. Nigeria had also spent a whopping sum of N2.95 trillion or $15billion in the past five years (2010-2014) in debts servicing. It is also feared in many informed quarters that Nigeria’s current public debts may most likely double at the end of President Buhari’s embattled administration by 2019, owing to alarming rates with which loans are being borrowed by his administration and subordinates of his administration particularly the State Governors.

“On the other hand, by the end of December 2016, a total of N118.2 trillion or $600 billion borrowed and generated public funds in Nigeria since January 2005 would have been squandered by the named public office holders. These public office holders are majorly and dually controlled by the Peoples Democratic Party (PDP) and the All Progressives Congress (APC). The two major political parties are also “two fingers of a leprous hand” used by those 17,500 public office holders particularly the elected; through back and forth membership and political trading, to squander the princely public funds under reference.

“This grounded finding of ours is built on similar facts laden finding made on 13th January 2013 by the Vanguard Newspaper, which corresponded with data available at the Federal Ministry of Finance. The report found that the referenced tiers of government and their agencies in Nigeria had between January 2005 and December 2013 budgeted, generated, borrowed and squandered a whopping sum of N80 trillion ($400 billion); out of which N56 trillion ($280 billion) was spent on recurrent expenditures, while paltry N24 trillion ($120 billion) was spent on capital expenditures. In our expanded and extensive investigation following the foregoing, we further found that another N38.2 trillion or $190 billion had been squandered between January 2014 and December 2016; a period of three years. Of this amount and by the end of December 2016, the Federal Government would have spent N16 trillion or $80 billion; South-South zone N5.6 trillion or $28 billion, Southwest N4 trillion or $20 billion, Northwest N3.1 trillion or $15 billion, 774 LGAs  N3 trillion or $15 billion, North-Central N2.1 trillion or $10 billion, Northeast N2 trillion or $10 billion, Southeast N1.66 trillion or $8.01 billion and the FCT N625 billion or $3.1 billion which includes a 2016 projected budget of N180 billion; totaling N38.2 trillion or $190 billion in three years.

“Our grounded findings were arrived at using the main public budgets of the Federal Government, the 36 States and the Federal Capital Territory; while in the case of 774 constitutionally recognised Local Government Areas (LGAs), their statutory federation allocations was used. For instance, in the 2015 federal allocations to the LGAs in Nigeria, a total of N953 billion or $4.5 billion was so allocated. On the other hand, our grounded finding did not include supplementary budgets of some of the 36 States and the Federal Government (some) as well as the internally generated revenues of the 774 LGAs. That of the LGAs was informed by total castration of the independence and functionality of the LGAs system in Nigeria; worsened by the provisions of Sections 162 (6) (State Joint LGA account) and 7(1) (management of LGAs by State Government). Also, in the course of our findings, the official exchange of N199.00/US$ was applied or used.  We also hold that if the “missing points” are added, the budgeted and squandered public funds in Nigeria in the past 12 years will be higher than the figure under discussion.

“Further breakdown of the above findings statistically indicates that by the end of December 2016, the Federal Government would have budgeted, generated, borrowed and squandered a total of N48.1 trillion or $240 billion; having budgeted and squandered N1.8 trillion in 2005, N1.9 trillion in 2006, N2.3 trillion in 2007, N3.58 trillion in 2008, N3.76 trillion in 2009, N4.6 trillion in 2010, N4.48 trillion in 2011, N4.7 trillion in 2012, N4.98 trillion in 2013, N4.92 trillion in 2014, N4.5 trillion and the Buhari’s supplementary budget of N575 billion in 2015 in addition to his 2016 budget proposal of N6.07 trillion; all totaling N48.1 trillion or $240 billion in 12 years or from 2005 to 2016.

“The South-south or Oil Niger Delta Region emerged the second largest squanderer with a whopping sum of N17.1 trillion or $85 billion; comprising N11.5 trillion budgeted and spent between January 2005 and December 2013, and N5.6 trillion between January 2014 and December 2016. The constitutionally recognised 774 LGAs emerged third largest squanderer with N14.4 trillion or $70 billion allocation in 12 years; comprising N11.4 trillion between January 2005 and December 2013, and N3 trillion between January 2014 and December 2016.

Southwest zone was 4th largest squanderer and the country’s sub national largest debtor. It squandered a total of N11.3 trillion or $56.5 billion; comprising N7.3 trillion between January 2005 and December 2013, and N4 trillion between January 2014 and December 2016. Northwest zone was the fifth largest squanderer with N8.5 trillion or $42.5 billion; comprising N5.38 trillion between January 2005 and December 2013, and N3.1trillion between January 2014 and December 2016; followed by North-Central as sixth largest squanderer with N7.35 trillion or $37.5 billion; comprising N5.19 trillion between January 2005 and December 2013, and N2.16trillion between January 2014 and December 2016. The Northeast zone was the seventh largest squanderer with N5.76 trillion or $28.8 billion; comprising N3.75 trillion between January 2005 and December 2013, and N2 trillion between January 2014 and December 2016.

This Southeast zone emerged 8th largest squanderer with N5.1 trillion or $25 billion; comprising N3.45 trillion between January 2005 and December 2013, and N1.66 trillion between January 2014 and December 2016. The ninth largest squanderer was the Federal Capital Territory (Abuja) with N1.96 trillion or $9.5 billion; comprising N1.33 trillion between January 2005 and December 2013, and N625 billion between January 2014 and December 2016; all totaling N118.2 trillion or $600 billion in the past 12 years or January 2005 to December 2016.

“It is shockingly sad that Nigerians are groaning in abject poverty in their land of plenty, to the extent that a whopping sum of N118.2 trillion or $600 billion was budgeted and squandered in the past 12 years (2005-2016) with little or nothing to show for it. Nigeria is a country of squander-mania. It is also developmentally dead as 98% of its solid minerals and agricultural produce are acutely subsistent or non-industrialised. Creative wealth is also near-totally absent owing to promotion by Nigeria’s political office holders particularly President Muhammadu Buhari administration, of sectional mediocrity and primordialism; corporate and bureaucratic idleness and laziness. Nigerian politicians rely heavily on oil and gas revenues as well as serial borrowings to sustain their political offices and siphoning of public funds.

“As a matter of fact, crude oil revenues account for 35% of the country’s Gross National Product (GDP); 75% of government revenues and 90% of its export earnings till date. The country has no traces of any foreign investment overseas and has become “a territorial non grata” for real foreign investors, owing to myriad of its man-made security threats and other unsafe conditions as well as the Buhari’s gross and unrepentant affront to rule of law, human rights and constitutionalism. The country’s foreign reserves have shrunk from $36billion in October 2014 to $28 billion in January 2016. Oil price has also fallen from $144 per barrel in July 2014 to as low as $30.25 per barrel in January 2016; leading Nigeria to lose over $70 billion in oil revenues yearly to plummeted oil prices and presidentially provoked oil militancy in the Niger Delta.

Nigeria is expected to earn a meager sum of about $33 billion from crude oil in 2016, from $102 billion in 2013/2014 at the rate of $110 per barrel into 2.3 million barrels per day.  Also, out of the expected dwindling crude revenues of about $33 billion for 2016, oil companies and drillers of the country’s crude oil are expected to be paid about $15 billion or about 49% as contractual royalties; leaving the country with about $18billion or N3.6 trillion oil revenues for this 2016. The Federal Government of Nigeria is expected to take about N1.5trillion or $7.5billion (52.6%); leaving the rest to oil States, 36 States, FCT and LGAs, etc. 

“The grand import of this grounded findings of ours is to bring to bear and to the attention of all Nigerians and members of the international community the entrenched squandermania culture of the country’s political office holders and their total neglect and abandonment of over 170 million citizens of the country to continually wallow in abject mass poverty; with the most shocking being chronic allocation of less than 30% of the budgets and staggering public funds under reference to capital projects. Another shocking observation of ours was resort particularly by States and the Federal Government to reckless local and foreign borrowings for the purpose of funding recurrent expenditures, comprising of personnel and overheads expenditures. In the Buhari’s supplementary budget of N575 billion of 2015, for instance, most, if not all of it was for recurrent expenditures and in his 2016 budget proposal of N6.07 trillion or $30 billion, N3.6 trillion or $18 billion was for non-debt recurrent expenditures; which include N1.83 trillion or $9.1 billion for personnel costs and N547.8 billion or $2.75 billion was for overheads costs. Only a paltry sum of N1.8 trillion or $9 billion (30%) was proposed for capital expenditures. This is totally unacceptable! 

“Nigerians and members of the international community are therefore called upon to  reasonably and sacrificially draw concrete comparisons between the expenditure of the staggering public funds under reference and level of socio-economic development  (i.e. roads, aviation, railway, transport, health, education, energy, water, shelter, justice, security and human rights, jobs, industry, environment and technology, etc) of their areas in particular and the country in general and be able to stand up and ask their political office holders, numbering 17,500, to account for the squandered public funds of N118.2 trillion or $600 billion in the past 12 years. They should rise up in condemnation of reckless and serial public borrowings in Nigeria particularly the entrenchment by political office holders of despicable habits of borrowing to squander and plunder”.

•Photo shows President Buhari with VP Yemi Osinbajo and ministers.

Source News Express

Posted 02/02/2016 6:45:15 PM

 

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