Atiku Abubakar
Former Vice President Atiku Abubakar on Sunday reported that Nigeria must act now, by taking necessary, and debilitating actions including adjustment to the proposed 2021 budget, to exit another downturn the country has entered.
Abubakar in a statement he issued in Abuja, said that although COVID-19 pandemic had exacerbated an already bad situation, Nigeria could have prevented the second downturn, within five decades, by disciplined and prudent management of the economy.
“Be that as it may, it serves no one’s purposes to quarrel after the truth.
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“We must concentrate on solutions. Nigeria needs critical leadership to guide her back to the path of economic sustainability.
“We can’t afford hand wringing and navel-gazing. We must act now, by taking essential, and perhaps painful actions.”
Abubakar said that for a start, the proposed 2021 budget introduced to the National Assembly on Oct. 8, was no longer tenable, saying Nigeria neither had the resources nor the need to execute such a luxury funding.
“The country is broke, but not broken. But if we continue to spend lavishly, even when we do not earn commensurately, we would go from being a broke country to becoming a broken nation.
“As a matter of importance and urgency, every non-essential line item in the proposed 2021 budget must be expunged.
“For the avoidance of doubt, this should include estacodes, non-emergency travel, feeding, welfare packages, overseas training, new automobile purchases, office updates, non-salary allowances, etc…
“Until our economic prospects improve, Nigeria should exclusively concentrate on making budgetary proposals for essential items, which include reasonable wages and salaries, infrastructural projects, and social services (citizenry’s health, and other human development investments).”
Abubakar also stressed the need to stimulate the economy, by investing in human development and increasing the buying power of the most vulnerable of the population.
He explained that only a well-developed people could generate enough economic activity for the country to leave the recession.
“We must invest in those most likely to be impacted by the effects of the recession, the poorest of the poor.
“As well as stimulating the economy, this also ensures that they do not slip further into poverty.
“For example, a stimulus package, in the form of monthly cash transfers of ₦5,000 to be made to each bank account holder, verified by a Bank Verification Number, whose combined total deposit in the year 2019 was lower than the yearly minimum wage.”
He proposed that it could be accomplished through a luxury tax on goods and services that were exclusively available only to the super-wealthy.
“A tax on the ultra wealthy to protect the extremely bad.
“A practical approach for this is to set a 15 per cent tax, on all first and business class tickets sold to and from Nigeria, on all luxury car imports and sales, on all private jets imports and service fees.
“Fifteen per cent tax on all jewelry imports and sales, on all designer products imported, produced or sold in Nigeria, and on all other luxury goods either manufactured, or imported into Nigeria, with the exception of products made for export.”
He said the proceeds of the tax should be exclusively dedicated to a Poverty Eradication Fund, which must be managed in exactly the same fashion as the Tertiary Education Trust Fund, or the Ecological Fund.
“I further suggest that a one per cent poverty alleviation tax ought to be legislated by the National Assembly on the profits of each global oil company operating in Nigeria, and international airlines doing business in Nigeria, which should also go towards the proposed Poverty Eradication Fund.
“It is inhumane for us as a country to improve the expense of goods and services that impact the poor, while keeping the cost of luxuries fairly stable.
“We must reverse this, and flip it instantly.”
Abubakar also advised that Nigeria must stop borrowing for anything aside from essential needs, saying borrowing to cover salaries or to engage in white elephants wasn’t an important need.
He explained that the action was particularly important as Nigeria needed cash at hand because the world and the nation’s economic and development partners were also focused on helping their home economies overcome the consequences of COVID-19.
“We must be our own saviours.
“The more we borrow, the more we will need cash to make interest and principal payments, and the less cash we will have to make necessary investments in our economy and our people.
“If we keep borrowing, we stand the chance of defaulting, and that will make the recession a child’s play because we will lose some of our sovereignty.”
He urged the national Government to open its mind to thoughts,” without caring who the messenger is”.
