third recession under his watch as President.
Nigeria slipped into a recession after its gross domestic product
contracted for the second consecutive quarter, according to data
released on Saturday which showed the impact of the COVID-19 pandemic
and low oil prices.
Atiku in a statement said the country could have been saved from
multiple recession had President Buhari listened to wise counsels from
him and other Nigerians.
The former Vice president suggested that every non-essential line item
in the 2021 Budget should be expunged, investments made in human
development, and the purchasing power of the poor and most vulnerable in
the society increased.
Atiku’s statement reads:
“It is with a very heavy heart that I received the confirmation that for
the second time in five years, Nigeria has entered into another
recession. Heaviness of heart, because this could have been avoided had
this administration taken heed to patriotic counsel given by myself and
other well-meaning Nigerians on cutting the cost of governance, saving
for a rainy day, and avoiding profligate borrowing.
“Yes, the COVID19 pandemic has exacerbated an already bad situation,
however, we could have avoided this fate by disciplined and prudent
management of our economy.
“Be that as it may, it serves no one’s purposes to quarrel after the
fact. We must focus on solutions. Nigeria needs critical leadership to
guide her back to the path of economic sustainability.
“We cannot afford hand wringing and navel-gazing. We must act now, by
taking necessary, and perhaps painful actions.
“For a start, the proposed 2021 budget presented to the National
Assembly on Tuesday, October 8, 2020, is no longer tenable. Nigeria
neither has the resources, nor the need to implement such a luxury heavy
budget. The nation is broke, but not broken. However, if we continue to
spend lavishly, even when we do not earn commensurately, we would go
from being a broke nation to being 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 ought to include estacodes, non-emergency travel, feeding, welfare
packages, overseas training, new vehicle purchases, office upgrades,
non-salary allowances, etc.
“Until our economic prospects improve, Nigeria ought to exclusively
focus 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).
“Additionally, we have to stimulate the economy, by investing in human
development and increasing the purchasing power of the most vulnerable
of our population. Only a well-developed populace can generate enough
economic activity for the nation to exit this 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 extreme
poverty.
“For example, a stimulus package, in the form of monthly cash transfers
of ₦5000 to be made to every bank account holder, verified by a Bank
Verification Number, whose combined total deposit in the year 2019 was
lower than the annual minimum wage.
“Now, how will this be funded? By more profligate borrowing? No. I
propose a luxury tax on goods and services that are exclusively
accessible only to the super-wealthy. A tax on the ultra-wealthy to
protect the extremely poor.
“A practical approach to this is to place a 15% tax on all Business and
First Class tickets sold to and from Nigeria, on all luxury car imports
and sales, on all private jets imports and service charges, on all
jewellery 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 goods made for export. The
proceeds of this tax should be exclusively dedicated to a Poverty
Eradication Fund, which must be managed in the same manner as the
Tertiary Education Trust Fund, or the Ecological Fund.
“I further propose that a 1% poverty alleviation tax should be
legislated by the National Assembly on the profits of every
International 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 nation to increase the cost of goods and
services that affect the poor, while keeping the cost of luxuries fairly
stable. We must flip this, and flip it immediately.
“And above all, Nigeria must stop borrowing for anything other than
essential needs. Again, for the avoidance of doubt, borrowing to pay
salaries, or to engage in White Elephant projects, is not an essential
need. This is particularly important as we need cash at hand, because
the world and our economic and development partners are also focused on
helping their home economies overcome the effects of COVID19. 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 risk of defaulting, and that will make recession a child’s
play, because we will lose some of our sovereignty.
“I urge the administration of President Muhammadu Buhari to swallow its
pride, and accept its limitations, so that they can open their minds to
ideas, without caring who the messenger is. For as Deng Xiaoping said
“It doesn’t matter whether the cat is black or white, so long as it
catches mice.”