N5,000 Stipend: Many Bridges To Cross | Independent Newspapers Limited
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N5,000 Stipend: Many Bridges To Cross

Posted: Nov 22, 2015 at 7:25 am   /   by   /   comments (0)

The Federal Government has assured that it will in 2016 commence payment of the N5, 000 stipend it promised to pay to unemployed graduates and ‘extremely’ poor Nigerians. But there are many hurdles that need to be crossed for the scheme to run efficiently

There is no longer any question about whether the Buhari administration will keep its campaign promise to pay a monthly stipend of N5,000 as social security benefit to unemployed graduates and ‘extremely poor’ Nigerians. Vice President Yemi Osinbajo gave government’s reassurance to Nigerians recently at the 10th year anniversary lecture of Crescent University, Abeokuta, in Ogun State.

According to him, there are ongoing plans to implement one of the administration’s campaign promises that it will pay N5, 000 each to the poorest Nigerians across the country. He noted that currently the government is evaluating the best ways to collapse existing cash transfer and social welfare schemes to ensure consistency and alignment.

“Once this is completed, we will implement the first phase of this programme, using recognised identification platforms and transparent payment solutions,” he said.

Ryan Cummings, chief security analyst at Ecobank, said the policy unarguably is the best because it is tandem with what obtains across the world. This is especially as it is the responsibility of government to provide security and cater for the welfare of its people; but good governance is also essentially about using cost effective and sustainable strategies to get result that translates into better living conditions for citizens.

“Implementing the project will be a Herculean task for the government, more especially now that revenue is dwindling very rapidly. But if the government is frugal and there is less corruption, the government will need to be very creative in raising the required revenue to pay for the stipend.

Another major issue is lack of statistics in the country. It will be difficult to determine those that will be qualified to receive the money. “Government will also face a major task of ensuring that it does not become a source of political patronage, especially in determining those who are ‘extremely’ poor,” he said.

Pioneer Chairman of Labour Party, Chief Dan Nwanyanwu, said ordinarily, one would have thought that the promise to pay the N5, 000 to the poorest Nigerians in form of social security was another campaign promise scheduled for the far future after the APC possibly must have been able to make a better meaning of Nigeria’s current economic degradation.

“But it’s quite baffling to hear Prof. Yemi Osinbajo who is highly cerebral in every sense, say that there are on going plans to pay N5, 000 to unemployed graduates and the poorest Nigerians across the country. “This is clearly another fire brigade approach to poverty alleviation.

The means or chances of possibly getting the project done and sustaining it suggest that the scheme might just end up to be another major scam just like many other schemes with seemingly good intentions at the outset,” he said.

Senior economics lecturer at the University of Lagos, Mr. Lanre Olagunju, on his Twitter handle on Friday faulted the pledge by Osinbajo, saying the mechanism with which this promise will be delivered is of great concern, “knowing fully well that the present Nigeria is one that pays little or zero attention to data.”

According to World Bank Statistics, there are about 112 million extremely poor Nigerians who practically feed on less than $1.25 a day. Olagunju posed a question on how the government intends to reach out to these 112 million directly, without shooting itself in the leg? “As this can easily turn out to be the biggest scam known to Nigeria, or a waiting opportunity by corrupt government officials to amass wealth. On what basis does the government consider a person to be extremely poor or unemployed?

What would the criteria be? The unemployment status is a temporary one; how does the project hope to get notified when a young graduate gets a good job with a good salary?

How long will the project last? How will the government sustain it and then deal with the increasing number of people in the category of unemployed year in year out?” he queried. He said until government improves on record keeping at every level, social security in form of giving money to the unemployed would rather create more problems.

“Is the present administration working and planning in line with the present low price of crude oil, and the fact that as at June 2015, market data says an estimate 80 million barrels of Nigerian crude are stranded and looking for buyers?

Where would the funds to cater for 112 million people come from despite the country’s huge and alarming debt? Certainly not from the stolen funds the Buhari’s government is yet to recover,” he said.

Meanwhile, Sunday Telegraph learnt that government is working on a figure of 25 million as the number of unemployed graduates and ‘extremely’ poor Nigerians that will be paid the monthly stipend. A former President of Association of National Accountants of Nigeria, Dr Samuel Nzekwe, urged the Federal Government to immediately commence work on a `realistic and cash-backed’ 2016 budget.

Noting that the N5,000 stipend for unemployed graduates and ‘extremely’ poor is a good policy, he added that “I don’t know how feasible it is when the number of unemployed is more than the employed. Some parastatals owe their staff and government complaints that they are spending too much on rerecurrent expenditure. I can’t actually match these.

“Let’s assume we have 20 million unemployed. Paying N5,000 to each person translates to N100bn every month and N1.2 trillion per annum. Statisticians can help me out on the figures and compare it to the national budget. Instead, I believe this money can be invested in developmental projects,” he said. Nzekwe said this during an interview with the Sunday Telegraph that it is important that `a budget be cash- backed.’

He said the sliding price of oil in the international market is a lesson to most nations to budget within the limits of their resources. According to him, the dwindling oil receipts implied that governments had to sit down and thoroughly plan their income and expenditure.

“The question is where exactly will the money come from? Presently 18 states are technically bankrupt and are finding it very difficult to pay salaries. Some owe as far back as eight months’ salary.

Many of these states have made agreement with contractors by signing irrevocable payment orders with financial institutions, by so doing, contractors get paid first from the money states get from Federal Government.

Many governors got into this financial mess by embarking on projects they had no financial capacity to carry out and also their inability to creatively generate income internally.

If this scheme is not deliberated upon before jumping into it, it will definitely set the Buhari administration in the same direction with the governors,” he said. If the money is invested, businesses will thrive. With adequate power, young and innovative Nigerians will create their own realities.

When stolen funds are retrieved, they should be used in investing into the economy such that entrepreneurship can blossom, which in turn would create employment.