2014 BUDGET: Continuation of Jobless Growth
2014 BUDGET: Continuation of Jobless Growth
(By Peluola Adewale)
President Goodluck Jonathan government is deficient in many areas. But the capacity to gild the rot with the best of superlatives is not one of them. Freshly dished on our plate is the theme of the current budget proposal, “job creation and inclusive growth”. This perhaps is the government’s answer to “jobless growth” that has been aptly used to describe the continued rise in the GDP in over a decade, one of the fastest in the world. But ordinary Nigerians have learnt from experience that they would take this government seriously at their own peril. Perhaps no country suffers from Dutch disease monumental socio-economic hardship and non-productive economy in the midst of huge revenue from crude oil – more than Nigeria.
The National Bureau of Statistics (NBS) claimed that 1.6million jobs were created in 2013. This was celebrated by the government as a badge of achievement even though it is a far cry from the official unemployment rate put at 24% which means well over 40million in labour market. Though the Minister of Finance Ngozi Okonjo-Iweala admitted that there are at least 2 million new entrants to labour market every year, the government according to the Minister of Trade and Investment, Olusegun Aganga, is targeting to generate 460,000 jobs in the next four years through what is called Growth and Employment project. “This is what the Nigerian Industrial Revolution Plan and the National Enterprise Development Programme, which were launched by President Goodluck Jonathan recently, seek to achieve.” Aganga gleefully stated (Punch February 21, 2014). This government must be a joker.
But the government is apparently inadvertently truthful to itself. The country with huge infrastructure deficit as a result of the monumental failure of successive capitalist governments cannot generate mass employment, hence the ridiculous target of 460,000 jobs in four years! But it is certain that this cannot be an industrial or technological revolution. Indeed, a mere peep into the 2014 budget proposal shows why “job creation and inclusive growth” and “growth and employment project” are catchphrases with no substance. Only 24% of the budget is for capital expenditure which is a drop by 7% from 2013 budget. Any government that is sincere about job creation will vote much more for capital projects.
It is however instructive to stress that a huge allocation to infrastructural development in itself is not enough. There must be democratic control of the resources and projects by elected representatives of workers, communities and relevant professionals. Otherwise such projects as experiences like the infamous Obasanjo government $16bn power project have shown will only serve as a means to siphon public resources to private coffers.
The Minister of Finance has attributed the rise in recurrent expenditure at the expense of capital projects to the pension implication of increase in salaries of civil servants in 2011. This is a spurious excuse. The real reason for huge recurrent budget every year is outrageous, jumbo pays of the top government functionaries which are said to be among the highest in the world. A report by the London’s Economist actually reveals that Nigerian legislators are the highest paid in the world. Interestingly, the same legislators are hypocritically sounding radical with condemnation of 2014 budget. According to a committee of House of Representatives the economy cannot be bright when government has earmarked N572bn to service N7.1tr domestic debt in the budget (Vanguard February 9, 2014.)
The rising domestic debt has become a serious deadweight on the economy. It is more appalling that there is no need for it except to gratify profit interest and greed of the so-called private sector. The debt can hardly be associated with any infrastructural development. Domestic borrowing is ostensibly meant to finance budget deficit and interest on what is called excess liquidity mopped up by the government. Excess liquidity is idle money in the banks vaults. It is the money banks refuse to lend to manufacturers or small scale industries but left idle for a super return when the government calls for it.
No doubt this government exists for the interest of the private vampires. This can only be the explanation for government granting waivers worth N603bn on import duty, which is a main source of non-oil revenue, to private companies or cronies in 2013 the same year it borrowed N588bn to finance budget. But as a report by Vanguard newspaper reveals the government actually gives “waivers to political associates and cronies to import and make cheap money” (Vanguard July 15, 2013.)
The House committee on Finance reveals that the cost of domestic borrowing in Nigeria is one of the highest in the world. In 2014 budget a huge sum of N712bn has been proposed by the government for debt servicing, a jump from N591bn voted last year. This is not only more than entire education budget – N655.47 billion but also far greater than the total of proposed capital expenditures on education, health care, works, transport, power, water resources, housing and agriculture and rural development.
It is clear from the 2014 budget proposal, which is of course driven by neo-liberal capitalist philosophy that the Jonathan government cannot tackle the problem of unemployment let alone poverty rate which has been on the increase in spite of huge oil revenue. To the thieving capitalist elite, the petrol dollar is meant only to feather their nest. For instance, Sanusi Lamido Sanusi the Governor of Central Bank, who was recently suspended by Jonathan government as the polity is heated up ahead of 2015 elections, has alleged about $20bn oil revenue has not been accounted for by NNPC, the national oil company.
Lamido Sanusi had earlier revealed that Jonathan government depleted excess crude account from $11.5bn in December 2012 to $2.5bn as of January 17 this year (Punch February 10, 2014). There is nothing to show in term of infrastructure development on account of this outrageous depletion in the revenue, which is ostensibly created for rainy day but usually spent by the both federal and state governments without budgetary appropriation. It is not accidental that Nigeria is ranked the least on Human Development Index among the OPEC countries.
It is however pertinent to immediately warn that the shocking disclosure of oil revenue fraud by Lamido Sanusi must not earn him endorsement by the working people as a defender of their interest. He is in agreement with Jonathan government on all fundamentals of anti-poor capitalist policies. For instance, it should be recalled he was one of unrepentant advocates of the increase in the fuel price in January 2012 that provoked the biggest general strike and mass protest in Nigeria. He is indeed a rabid hater of government subsidies to social program while he supports bail-out for banks with public funds. Sanusi’s sacking only reflects the constant in-fighting between rival sections of the ruling elite.
The working people must continue to struggle for immediate improvements and allocation of public resources for genuine development and social programs. The last strike by Academic Staff Union of Universities (ASUU) over funding of university education proves that struggles can win some concessions. But as experiences have shown such gains of struggle do not last long as they are essentially revoked by the government through other means.
This is one of the reasons the working people need their own political party to contest and win political power with aim of using the resources of society for the benefits of the vast majority of population. But for this to be a reality such party must be based on socialist program which means, inter alia, while in government it must take into public ownership the commanding heights of economy and resources of the society, and subject them to democratic management and control of the working people. This is why we of DSM have been campaigning for a mass working people party with socialist program. But the failure of leadership of trade unions and mass organizations to help fulfill the potentials for formation of such party at present necessitates the formation of even a small party, like Socialist Party of Nigeria (SPN), that can set a striking example as a platform that represents the interests and aspiration of working class people and the poor in opposition to the parties of the rival factions of the ruling class. We call on workers, youth and masses to join the SPN today.