Connect with us


FG’s palliatives face integrity questions amid worsening poverty



FG’s palliatives face integrity questions amid worsening poverty

Escalating number of Nigerians living below poverty line is raising concerns about the efficacy of series of interventions by the Federal Government to cushion the effects of the fuel subsidy removal and other harsh policies of the Tinubu administration.

Last week, President Bola Tinubu, announced another N1 trillion, bringing the palliatives so far rolled out by his administration to about N4.3 trillion, according checks by Business Hallmark.

According to government releases, parts of the palliatives have been payments of cash to no fewer than 18.7m vulnerable households, and acquisition of CNG powered buses in the light of rising inflation. It also included agricultural interventions and financial aids to manufacturers as well as small and medium scale enterprises in the country.

Tinubu is sustaining a culture of palliatives initiated by his predecessor, Mohammadu Buhari, whose administration failed through its National Social Investment Programme (NSIP) to allay poverty after expending over N2 trillion on the programme.

Buhari’s campaign was dominated by his Economic Recovery and Growth Plan (ERGP), which promised to restore, boost and resuscitate the Nigerian economy that had gone into recession.

On assumption of office, he established the National Social Investment Programme (NSIP) ostensibly to address the immediate and long-term socio-economic imbalance, alleviate poverty and act as a stimulant to further economic growth.

The NSIP includes a range of programmes like the Government Enterprise and Empowerment Programme (GEEP loans – MarketMoni, FarmerMoni and TraderMoni), N-Power, National Home-Grown School Feeding Programme (NHGSFP), and Conditional Cash Transfer (CCT).

The Federal Government, through the then Minister of State for Budget and National Planning, Clement Agba, revealed that it had invested a sum of N500 billion annually from 2016 to 2019 in the NSIP.

This means that the Federal Government appropriated a sum of N500 billion for 2016, 2017, 2018 and 2019 budget calendar each. Other documents seen by Business Hallmark showed that over N5.04 billion was appropriated for similar programmes between 2020 and 2023.

Despite these interventions and funding, 63 per cent of the population was estimated to be living in different categories of poverty, according to the National Bureau of Statistics (NBS) Nigeria Multidimensional Poverty Index (2022). The report stressed that 65 per cent of the poor (86 million people) live in the North, while 35 per cent (nearly 47 million) live in the South.

Business as usual

In the case of Tinubu, shortly after fuel subsidy removal declaration on his day of inauguration, the World Bank cautioned that about 7.1 million Nigerians were at risk of poverty if the Federal Government failed to compensate or provide palliatives for them.

“The removal of the petrol subsidy had caused an increase in prices, adversely affecting poor and economically insecure Nigerian households. Petrol prices appear to have almost tripled following the subsidy removal.

“The poor and economically insecure households, who directly purchase and use petrol as well as those that indirectly consume petrol, are adversely affected by the price increase. They will face an equivalent income loss of N5,700 per month, and without compensation, an additional 7.1 million people will be pushed into poverty,” the World Bank had stated.

However, in a national broadcast on July 31, President Tinubu announced the government’s first sets of palliatives, which included N100bn to acquire 3,000 units of 20-seater CNG-fuelled buses, N200bn to boost agriculture production, N75bn for manufacturers, and N125bn for micro, small and medium-sized enterprises, and the informal sector.

Similarly, in August last year, his administration announced N5bn as palliative measures for each state of the federation and 180 trucks of rice. The Borno State Governor, Babagana Zulum, who made the announcement, said the N5bn would enable the state governments to procure 100,000 bags of rice, 40,000 bags of maize, and fertilisers to cushion the food shortage in the country.


Also in 2023, the government announced N35,000 monthly provisional wage award for all treasury-paid Federal Government workers for six months, which began in September last year.

The Director-General of the Budget Office of the Federation, Ben Akabueze, had revealed that the Federal Government’s personnel cost was over N5tn, with 1.5 million workers on its payroll. The implication is that the government’s N35,000 commitment to workers would cost N315bn for the six months.

While announcing the N35,000 wage award, the Minister of Information and National Orientation, Mohammed Idris, also revealed that the government would commence the payment of N75,000 to 15 million households at N25,000 per month for three months (October to December 2023), totalling N1.13tn for the period.

There was also the controversial N70bn palliative earmarked to lawmakers to support “the working conditions of National Assembly members.”

The Federal Government also announced an extension of the N75bn loan facility to 1.5 million market women, which brought the total palliative and loan pledge by the Federal Government last year to N3.27tn.

Speaking at the 142nd National Economic Council meeting attended by state governors and some deputies at the State House, Abuja, last week, the President announced a National Construction and Household Support Programme, which will see 100,000 families in each state get N50,000 grant for three months.

Tinubu said N155bn would be disbursed for assorted foods, N540bn for household grants, while the 36 states and the Federal Capital Territory would get N10bn allocations each for CNG buses.

According to him, the N50,000 grant was being planned for 3.7 million families across the 36 states and the FCT, which takes the total number of families so far captured in the government’s households grant to 18.7m under the current administration.

In total, the N50,000 planned for 3.7 million families across the 36 states and the FCT, the N10bn allocation each for CNG buses in the 36 states and the FCT, as well as the N155bn spending on assorted foods, are estimated to cost over N1tn. Added to about palliative and loan pledge by the Federal Government last year, it comes to N4.3tn.

Questionable outcome

Despite all the palliatives, the removal of petrol and electricity subsidies and the devaluation of the naira continue to take a devastating toll on businesses, lives, and livelihoods. Food inflation has topped 40 per cent since March and headline inflation rose to 33.95 per cent in May up from 33.65 per cent in April. Prices of staples have risen by an average of 300 per cent within the past year.

However, President Tinubu on Thursday, said his administration would inject about N2 trillion into the economy within the next six months. The President was inaugurating the Presidential Economic Coordination Council (PECC), which has Africa’s richest man, Aliko Dangote and Tony Elumelu and other notable private sector players as members in Abuja.

Minister of Finance and Coordinating Minister of the Economy, Wale Edun, while briefing State House Journalists after the event, revealed that the President had signed Executive orders, which were being gazetted to ease the cost of doing business in Nigeria.


News continues after this Advertisement
News continues after this Advertisement