The Managing Director, Cowry Asset Management Limited, Mr. Johnson Chukwu has said that the proposed N5, 000 payments to the poorest Nigerians promised by President Muhammadu Buhari during his electioneering campaign is a difficult but not an impossible task.
Chukwu who made this known in an interview with Primetime Reporters in Lagos stated that the president could define the criteria as well as use that to select those to benefit from that social safety net even as he wondered whether or not the criteria to be selected by the President would be fair.
He reiterated that if President Buhari should go on with his promise to pay the said N5, 000 to 25 Million poorest Nigeria on the condition that they send their children to school and immunize them, it would amount to paying out on a monthly basis N125 Million or on another basis, N1.6 Trillion.
According to him,” Today, the national budget is shy of N5, 000 Trillion, N4.9 Trillion even if you agree I is N5 Trillion, a N1.5 Trillion handout to 25 million bottom Nigerians will amount to paying out 30 percent of the national budget.
“Total capital expenditure budget for 2015 is N556 billion, so, that is almost three times of the total capital expenditure budget of 2015. So, it is very difficult for government to have that fund. But beyond that, it will be difficult for the government to sustain it. It simply means that the government has to sacrifice its operations to pay the N5, 000 transfer payments to the bottom Nigerians. I don’t see the feasibility of implementing that policy”.
The financial expert maintained that there were several issues in the process of selecting those 25 Million Nigerians adding that the sacrifices the government would make in terms of alternative use of fund would impact negatively on the social needs of the citizens of the country.
“The road networks, transport network, rail system, educational system, schools, hospitals, I think those should be of priority to the government, to build the necessary infrastructures that will lift the people out of poverty instead of subsidizing those people out of poverty.
“I believe if we have appropriate school system and if we have a good healthcare system and if we could build infrastructure and that will catalyze the private sector and it will help to create employment for those 25 million bottom Nigerians”, he insisted.
He continued,” The key factors are that it may be difficult, it is not impossible you could define a criterion and use that criterion to select but would it be fair? Are you not going to have people that have income that are going to come into the dragnet and still be subsidized? The basic thing is that in today’s Nigeria, the N1.5 trillion is about 8 billion dollars. If you recast your mind back, at the tail end of Jonathan’s administration, he gave out a contract of $8 billion to run a standard rail gauge from Lagos to Kano.
“So, it simply means that one year subsidy of those families will build infrastructure that will create strata of businesses along that corridor and may be 5 or 2 percent of those people who may get this handout will find jobs along that corridor and live happily thereafter.
“So, let us create an enabling environment to create the necessary infrastructure that will catalyze economic growth and create employment for the citizens”.
