A former Deputy Governor of Central Bank of Nigeria (CBN) Rev. Tunde Lemo, has revealed how former governors were opposed to Federal Government’s decision to save excess crude revenue.
Lemo spoke on Wednesday at the 61st annual Foursquare Gospel Church in Nigeria National Conference lecture, entitled: The Nigerian Economy: The Past, Present and the Future.
According to him, past state governors had on several occasions arm-twisted the executive, insisting that revenue accruing from oil should be immediately shared among states, instead of saving it in Excess Crude Account initiated by former President Olusegun Obasanjo.
“During some of the Federal Executive Council sessions, where I was present, the issue of saving funds generated from the sales of excess crude came up, but most of the governors at the time firmly opposed the idea.
“They opposed it so that more money could be available to fund many bogus budgets at state levels, often arguing that there was no need for saving for the rainy day, since, as some of them said, the day was already rainy.
“They insisted that the funds be shared among the states. Unfortunately, it greatly depleted the funds the Federal Government tried to save.”
The former CBN deputy governor suggested five ways to put the country back on the path of growth.
According to him, the five recovery steps are:
- Restructuring, including fiscal consolidation
- Diversification of the economy
- Lifestyle changes and inclusive growth
- Investment in infrastructure
He said: “We must restructure because the present structure is too expensive, as it emphasizes resource sharing as opposed to production. The tax laws should be amended so that each zone will have total control over its resources.
“The economy must be diversified with immediate effect, and in addition, we need to move faster on the increase in our local petroleum refining capacity. More refineries should be privatised without delay.
“We should also embrace Nigerian-made products and this should start with such basic things as school uniforms, textiles, shoes etc . The government should also look beyond the annual budget for funding infrastructure.
“We have to reverse the negative trend of spending more of our resources to nurture the bloated government structure.
“We must rebuild the public school system and re-introduce technical education. We also need to build strong institutions and enhance property rights because many of the existing institutions are weak and with overlapping functions.”
Commenting on the administration of President Buhari, Lemo said though the President had already spent 14 of the 48 months of tenure of office, nobody could point at progresses that had been made without some brainstorming.
“While statistics point to improvements in the area of national security, economic problems are humongous and the presence of the political will to move the nation forward was not enough to achieve a quick fix.
“Recent, macro-economic indices show that Nigeria’s economy is in dire need of attention by policy makers. Inequalities have been widening and security challenges appear hydra-headed.