19102020 - #EndSARS: Stop Army's planned Op Crocodile Smile

“We do many things at the federal level
that would be considered dishonest and
illegal if done in the private sector” -
Donald T Regan, 1986.
Donald Regan was US
Secretary of the
Treasury (equivalent to our
own Minister of Finance),
from 1981-85 and Chief of
Staff from 1985-87 for the
Reagan administration. He
was familiar with all the
dishonest measures of the US
federal government which, if
engaged in by an individual,
will brand him a fraudster or
419er. The Nigerian FG is not
only just as guilty but operates
with far less restraint than the
US government. Add our
National Assembly, NASS,
invariably accomplices in the
budgetary crimes and the
Three Arms Zone of Abuja
constitutes a greater peril to
our economy than all the
armed robbers, Area and
Yahoo Boys.
The quantum of funds
mismanaged in Abuja will
make all the acclaimed
criminals appear benevolent.
Every subsequent fraud stems
from the way budgets are
packaged by the FG and
approved by the NASS.
Virtually every entry is false
and known to be so.
President Buhari presented
what was announced as the
2021 Budget to the NASS, on
October 8, 2020. It was a
terrible joke. This article might
as well be titled FG
PRESENTS ANOTHER DUD
CHEQUE TO NIGERIANS
and it will be just as apt.
Budget 2021 incorporates all
the faults of the previous five
failed budgets – 2016, 2017,
2018, 2019 and 2020. And, this
latest demonstration of
incompetence at budgeting,
added a few more to ensure
that it will never be
implemented. By the time
Buhari presents Budget 2022,
we will all see clearly why this
budget represents more than
a disservice to the nation. It is
almost a crime against
Nigerians. If a man had spent
the last five years promising
more than he could deliver,
Nigerians would by now have
several unprintable epithets
with which to describe him if
The 2021 Budget as a joke (1)
he announces a sixth attempt
at mass deception.
“You can fool some of the
people all the time.” That was
the observation of a late
American President. He must
have had a nation like present
day Nigeria in mind. And
some of the people annually
misled are the members of the
NASS, who assume that
because it is their party leader
who is presenting the budget,
they are duty bound to
endorse a bogus document.
The blind leading the blind
is bad enough. A government
of the blind leading people
with good eyes, in Abuja, is
one of the greatest absurdities
of the world today. Show me a
NASS member who actually
believes that this budget will
work and I will show you an
economic illiterate who should
not be representing any
Nigerian.
Before the rubber stamp
NASS passes the budget, let
me provide five cardinal
reasons why it will not work:
aggregate expenditure
estimates, debt burden and
servicing, capital expenditure,
poverty alleviation and timing
of funds release. One can
easily add agriculture,
manufacturing and lingering
impacts of COVID-19. But, the
five are more than enough to
prove the points made here.
As usual, although I can make
all the observations myself, it
is always better to bring third
party evidence – bearing in
mind the tendency of the
Presidency to instigate
comical rejoinders.
“Buhari put aggregate
expenditure
at
N13.08tn..,,debt servicing
[would gulp] N3.12tn..The
2021 budget deficit…is
projected at N5.20tn,
representing 3.64 per cent.”
The projected expenditure is
partly based “on daily crude
oil production of 1.86m and oil
price of $40 per barrel.”
President Buhari, October 8,
2020.
Longer before Buhari, the
FG had presented annual
budgets based on daily
production and export of
crude oil far in excess of what
historical trends or objective
future forecasts would
suggest.
Since 2011, two of our
associates had requested from
us projections of Nigerian
Longer before Buhari,
the FG had presented
annual budgets based
on daily production
and export of crude oil
far in excess of what
historical trends or
objective future
forecasts would
suggest
crude oil production and
export. Even, globally
acclaimed Dr Ngozi Okonjo-
Iweala, sadly, had succumbed
to political pressure by the
Jonathan administration.
Budgets for 2012 to 2015 were
premised on 2.3mbpd despite
annual warnings from us. Not
once in four years was Nigeria
able to export 2.3mbpd of
crude. Yet, the Jonathan
government persisted in
deceiving itself and Nigerians
for four years. It was a blunder.
While Jonathan had at least
two world-class economists in
charge of its Economic
Management Team, Buhari,
right from the start, till now,
had been lacking such global
financial experience. It has
been extremely easy for them
to rely on base sentiments
when deciding that basic but
most important variable when
Vanguard, MONDAY, OCTOBER 19, 2020 — 21
deciding crude oil production
and export. For instance, it is
a fact that Nigeria, based on
agreement with OPEC, is
honour-bound not to exceed
1.7mbpd of crude well into the
first quarter of next year.
Furthermore, as 2020 is
coming to a close, Nigeria’s
exports of crude have
averaged less than 1.5mbpd.
Experienced and objective
managers anywhere will
never ignore historical trends
and known future certainties
when preparing their budgets
as Buhari’s government had
done for six years in a row.
Just as Jonathan’s
administration failed to reach
the target in five years,
Buhari’s will again fall short
for the sixth year in a row –
unless a major disruption to
global oil supply occurs. No
nation’s leaders should
gamble and lose repeatedly
with the lives of the people.
Those who fail to remember
history, including their own,
are condemned to repeating
its mistakes. Unfortunately,
crude oil revenue shortfall is
not the only problem we have
experienced since 2015. With
expenditure projected at
N13.08tn and deficit of
N5.12tn expected, the FG was
deliberately evasive about the
anticipated revenue for 2021.
The figure derived is N7.96tn
or 60.85 per cent of
expenditure. Close to 40 per
cent of projected expenditure
will have to be sourced from
elsewhere, other than
government operations.
Once again, we are faced
with the analogy of the family
head who regularly promises
more than can be delivered
and frequently fails to redeem
his promises. Dud cheques
follow.
Customer-centricity, Since 2015, the FG has tech to drive
insurance growth — will continue Leadway into 2021.
failed to generate the revenue
budgeted for each year. As we
crawl to the fourth quarter of
2020, the actual income of
government will most likely
not exceed 62 per cent of this
year’s estimates. Again,
experienced and honest
managers base their future
projections on trends in the
previous five years. So, it can
be reasonably assumed that
the FG will not generate
N7.96tn in 2021; but more
likely N4.8tn. The 3.2tn
negative variance will
comprise of lower receipts of
crude oil revenue, remittances
from Ministries, Departments
and Agencies, as well as Value
Added Tax, VAT, etc.
This had been the pattern for
five years and nothing
suggests 2021 will yield a
different result. So, though not
specifically stated in the
budget presentation, the
implied Internally Generated
Revenue, IGR, remains very
unrealistic.
Here is third party evidence.
“Earlier…, Fitch
Ratings….said that the rate of
Nigeria’s sovereign debt
could trigger a downgrade as
government battles to raise
revenue amid depleting
earnings and low prices…”
DAILY INDEPENDENT,
OCTOBER 12, 2020.
For those still doubting that
objective financial experts are
unanimous in their verdict
that the FG’s estimates are
unrealistic, here is more proof.
Dr Muda Yusuf, Director
General, Lagos Chamber of
Commerce and Industry
(LCCI), in response to the
proposed expenditure of
N13.1trillion, in 2021, said,
“...revenue projections seem
optimistic, having regards to
revenue performance over the
last few years. We have
witnessed large negative
variances in revenue targets
over the last few years. This
poses a risk of bigger deficits
than projected.”
The safest assumption is
that large negative variances
To be continued…
Financial Inclusion: FirstBank targets 32m customers
with innovative products
By Babajide Komolafe
First Bank of Nigeria
Limited has deployed
innovative financial inclusion
enhancing products and
services aimed at achieving
customer base of 32 million
by 202.
Disclosing this in an
interview with Vanguard,
Deputy Managing Director
of the Bank, Mr. Gbenga
Shobo, said: “Our current
focus is the growth of
customer base to 32 million
and increasing our agent
touchpoints to 100,000 by the
end of 2020.”
He added that the vision of
the bank is to build on the
milestones it has so far
achieved in its contributions
to the attainment of the
national financial inclusion
goal.
These milestones
according to Shobo include
the financial empowerment
of 76,000 Firstmonie agents
who have so far processed
over 390 million transactions.
He pointed out that the
bank’s Firstmonie agent
network has created over
228,000 indirect jobs with
about 26 percent of the
agent’s females resulting in
financial independence and
freedom.
“The past three years have
been exciting for us. As a
bank we have been able to
create a distribution channel,
agent network, that covers
every part of the country,
build an ecosystem to
empower individuals and
communities, and provide a
no-frills account (mobile
wallet) that allows customers
carry out basic financial
transactions without a bank
account.
The wallet is Telco and
Bank agnostic and can be
funded from multiple sources
– debit card, bank account,
and via any of our Agent
locations”, he stated.
Shobo noted that though
Nigeria has the potential to
drive a significant proportion
of the adult population to
financial inclusion, progress
has been slowed due to the
barriers of financial
illiteracy, lack of products
and services that fit the
under banked, affordability
as well as the low awareness
levels for available products.
FirstBank, he added has
however deployed innovative
products and services
designed to overcome the
challenges posed by these
barriers.
He said the products
include Firstmonie Wallet, an
electronic wallet that allows
individuals the convenience
of making and accepting
payments electronically with
their mobile numbers.
“Another product is
FirstGem accounts, a
bespoke solution to foster
empowerment of women
across the socio-economic
strata. FirstGem which has
recorded significant
milestones is a product that
is ideal for all women aged
18 years and above, whether
working professionals or
entrepreneurs; and it comes
in two variants, savings, and
current accounts.
“We also have Agent
Credit, is an innovative
digital lending solution
designed to solve immediate
liquidity challenges
especially when Agents
account balances are
depleted/low despite having
cash at hand.
Furthermore is BVN
enrolment in local
communities, where
potential customers are
registered through our agent
banking network in local
communities.
“We complement the above
by conducting financial
literacy trainings. This is
done through train the
trainer methods in local
communities, using key
personnel of the bank,
namely our digital product
sales executives and trade
developers.”