The myriads of challenges confronting the country would be removed if the present administration wholistically implements the Oronsanye Committee Report recently approved by the Executive Council of the Federation (FEC), the Revenue Mobilization Allocation and Fiscal Commission (RMAFC) has said.
The Chairman of the Commission, Mohammed Bello Shehu, who identified some of the challenges to include the dearth of infrastructure and social amenities, declining investments, high unemployment and rising insecurity.
Recommendations contained in the report, he said, were adopted by the FEC as a way of helping the government curb high cost of governance through the restructuring and rationalization of Federal Government agencies, parastatals and commissions.
The Committee had observed that the problem of cost of governance was responsible for the reduction in the provision of basic infrastructure and other key social services in the society, and consequently the fall in the level of investment in the economy.
The RMAFC Chaiman who observed that no society can make meaningful progress unless it developed a competent and cost-effective management system capable of maximizing the nation’s resources to the benefit of all.
The chairman recalled that RMAFC has over the years advocated for a reduction in the cost of governance as a way of preserving scarce resources for the sustainable development of the country.
Also, he said the Commission had proffered far-reaching suggestions and recommendations to governments at all levels on the need to scale down on unnecessary expenditure and to monitor expenses on developmental projects that would impact positively on the lives of the citizenry.
The high cost of governance in Nigeria, Shehu said, was caused by the expensive nature of the presidential system of government, large bureaucracy, duplication of government ministries, departments and agencies and endemic corruption.
Other factors included the high cost of public service delivery due to infrastructure failure, high-security costs as a result of insurgencies, kidnappings, ethnoreligious agitations and armed robbery, multiple salaries and severance allowances, extravagant activities and expenditures, high domestic and foreign debts and weak enforcement institutions.
The RMAFC Chief also noted that the cost of governance over the years has been very high and alarming and therefore unsustainable, as recurrent expenditure continues to significantly exceed capital expenditure, thus negatively impacting on investment, industrial expansion, infrastructural development and growth of the real sectors of the economy.
The Chairman of the Commission lauded the wholesale adoption of the Oronsanye report by present administration, expressing optimism that it was capable of drastically reducing the cost of governance, and thus conserve funds for infrastructural development, which would impact positively on the lives of the citizens.
Commenting on the current fiscal and monetary reforms undertaken by the government, Shehu explained that they were prioritizing price and exchange rate stability to promote sustainable economic growth, and safeguard the livelihoods of Nigerians.
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Such policies, he pointed out, would play a crucial role in cushioning the impact of hyperinflation in the economy.
“The RMAFC sees price stability and exchange rate stability as good policies in the right direction. The price stability preserves the purchasing power of the national currency, provides confidence to the investors and assists the citizenry to plan their spending and savings more effectively,” he said.
Besides, he said introducing policies aimed at reorganizing the Bureau De Change Market to achieve transparent market operations in line with International Best Practices was commendable.
“The policy will enhance credibility, transparent operations and build trust among market participants, regulatory authorities, and the public. A reorganized BDC market with clear and open processes contributes to the credibility of the foreign exchange system,” he said.
The RMAFC said the policy would reduce exchange rate volatility, minimize uncertainties in the foreign exchange market, attract direct foreign investment, improve financial inclusiveness, reduce speculative activities, improve regulatory oversight and ensure effective monetary policy implementation.
“When stakeholders have access to accurate information about market conditions, it can lead to more stable exchange rates, reducing volatility and providing a more predictable environment for businesses and investors,” he said.
He advised the present administration to consolidate the synergy and coordination between monetary and fiscal authorities and the current structural reforms, implementing Oronsanye report would bring a more stable exchange rate, control inflation, reduce the cost of governance, and create an enabling environment for businesses and individuals to thrive.
Again, he advised the Committee on the implementation of the Oronsanye Report to equally consider the duplication of agencies, especially those created after the report between 2014 to date, adding that a wholistic implementation of the report would save funds for infrastructural development in the country.
In order to cushion the effects occasioned by the subsidy removal, the RMAFC Chairman called on the Federal Government and States to judiciously utilize the increased allocations from the monthly Federation Accounts Allocation Committee (FAAC) to provide adequate palliatives to the teeming masses in the country so as to alleviate their suffering.
