- Cabinet too large, will put more burden on ‘struggling economy’ – Economists
- Ministries under Tinubu’ll expand opportunities, reduce poverty significantly – Stakeholders
BY TIMOTHY AGBOR, AND BRIGHT JACOB
Economists have expressed displeasure over what they described as the bloated cabinet of the President Bola Tinubu-led Federal Government, saying appointment of more ministers will only lead the nation to more economic woes.
Except there is a salary cut or their number is reduced, the welfare of the 45 ministers who were sworn-in on August 21, 2023, will cost Nigeria’s tax payers at least N2, 820,768.000 trillion in the next four years.
The observations came just as President Tinubu appointed two new ministers on Sunday.
He approved the nomination of Jamila Bio Ibrahim as the Minister of Youth, pending her confirmation by the Senate.
The President has also approved the nomination of Ayodele Olawande to serve as the Minister of State for Youth, pending confirmation by the Senate.
The Special Adviser to the President on Media and Publicity, Ajuri Ngelale, made the disclosure in a statement on Sunday.
“President Tinubu charges the above-mentioned nominees to ensure that they consistently reflect the dynamism, innovative zeal and unyielding productivity that are synonymous with the young people of Nigeria as they discharge their duties,” Ngelele said.
According to the statement, Jamila Bio Ibrahim is a young medical doctor and recently served as the President of the Progressive Young Women Forum.
She has also served as the Senior Special Assistant to the Kwara State Governor on Sustainable Development Goals.
Olawande is a community development expert and youth leader in the governing All Progressives’ Congress.
He served in the Office of the Special Adviser to the President on Innovation from 2019 to 2023.
A replacement is expected from Kaduna State following the withdrawal of the former Governor of Kaduna State, Nasir El Rufai.
Each minister will get at least N58.766 million in four years.
The figure could however rise as the Revenue Mobilisation Allocation and Fiscal Commission finalises its review of public servants’ remuneration.
According to economic experts, in their separate interviews with The Point, the estacodes package of the ministers would cost more than their regular salaries and allowances.
Noting that the jumbo pay and the large federal cabinet was not sustainable for the economy, the financial experts disclosed that the budget for non-regular allowance of the ministers might hit N1.5 trillion in the next budget as it currently stands at about N1 trillion.
They said the estacodes were for the foreign trips by the ministers and other luxurious lifestyles.
An economist, Samuel Atiku, noted that if President Tinubu failed to merge ministries in order to cut the cost of governance, inflation might skyrocket, while the number of people caught in multidimensional poverty in the country would increase.
“Ministries are not critical to drive change. We need to find a way to ensure that it doesn’t bring burden on average Nigerians. The cabinet is too large and I don’t think that the treasury that we have can sustain this”
He said, “Nigeria is in a complex situation and when you look at the cabinet itself, it is something that has been topical all along and we have always complained. It is not as if the size of the government is that big when compared to others but when you see the administrative structure all around you, it could raise some questions.
“When we think of the cost of governance, I am far more concerned about how funds are administered, when you take the Federal Government as one entity and you look at the personnel components. The personnel cost component is divided into two generally; you have the salary and wages of workers and politicians and you have the non-regular allowance.
“Now, the salaries and wages are about N3.5 trillion, it is not that massive when you compare to other countries but where the problem comes in is the non-regular allowance involving things like estacodes. So, everything put together, I think for last year, we saw about N1.1trillion as non-regular allowance.
“For me, I think that the structure of governance is huge because the budget in Nigeria is decentralised and one of the weakest problems that we see in Nigeria is the fact that there are weak oversights. For instance, if the president makes a statement and says I want to ensure that there are spaces for more undergraduates to get admission, it is now left to the federal universities that will take action. What we have seen over the past 10 years is that the president’s statements do not necessarily amount to actions being taken and that boils down to weak oversights in terms of planning.
“One of the ways to strengthen those weak oversights is may be the president suggesting breaking it down to more units he can directly supervise.”
While identifying other dangers that would make the cabinet size unsustainable, Atiku stated, “The monetary value of the cost of governance is very important but when you look at other resources associated with it, you will know there is more danger to the economy. For instance, the security you have to deploy into protecting these ministers, the office building these people will occupy. Just imagine a typical office space in Maitama. So, if you quantify that and you put that in value, you will notice that it is way bigger than what you have actually mentioned (N8.6billion).
“Once you set up a ministry, what it means is that you are bringing agencies and departments and you will appoint directors over different departments, you are bringing in permanent secretaries, so, the entire architecture becomes very unwieldy.”
“We need a holistic plan and I am not sure creating 500 ministries will solve any problem in Nigeria, it is only going to fill in the box for political considerations. Some ministries can be fused together,” he recommended.
He said President Tinubu was not sincere about cutting the cost of governance, which was the essence of subsidy removal, adding that “about N2 trillion was said to have been wasted on subsidy removal and here we are budgeting over N1 trillion on non-regular allowances of ministers and the president.”
“Now that the number of ministers has increased, the budget for non-regular allowance may go up by about N1.5 trillion. So, you can raise big questions: are we really cutting down on the cost of governance or are we actually worsening it?” Atiku rhetorically asked.
A former Deputy Governor of the Central Bank of Nigeria, Tunde Lemo, said the Federal Government had set a bad example by having the largest federal cabinet in 24 years.
He said the recent effort by the Federal Government to reduce the size of the delegates to the 78th UN General Assembly was a good sign but that much more was required from the top.
In his submission, another economic expert, Olaide Ajibola, said, “Ministries are not critical to drive change. We need to find a way to ensure that it doesn’t bring burden on average Nigerians. The cabinet is too large and I don’t think that the treasury that we have can sustain this jumbo pay.”
The expert noted that borrowing through Ways and Means by the Federal Government had been one of the ways of putting up with high cost of governance of government.
He said, “Nigeria’s debts have grown significantly to almost N36 trillion; if you look at the CBN website, credits to government have gone up to N36 trillion and this is not good for our economy. The effect is that more Naira in circulation is running after a few dollars and it will result in more inflation and when inflation goes up, you push more people into poverty.
“You know when the last multidimensional poverty index was released, they said 133 million but between January and now, the number of people that have been thrown into poverty, based on higher inflation, higher costs, rural income of people and the little income that people are having, which they need to pay for electricity, transportation and all, has increased.”
“So, the outlook is not looking nice at all. We are in a very soft land and I think we are standing on sinking sand and the only way we can rework this thing is that we need to put a break on inflation, we need to sell hope to people, we need to look at how to put money into people’s pockets and raise their income. My fear is that the country is pulling apart very fast and actions are not being taken,” he added.
However, the immediate past president of the Nigeria Civil Service Union, Lawrence Amaechi, who had some doubts about the figures said that when broken down, the monthly take-home pay of each minister would not be more than N1.5 million.
He said the sustainability of the ministers’ salaries for the next four years was not in doubt because as long as they were in government, they would be paid salaries “from the common pool”.
He said, “If you break the figure each minister will receive in the next four years down, you will see that it is not up to N1.5 million. This is why I will not go into cumulative amounts. If the salary is, therefore, less than a million or N1.5 million, definitely, it is a monthly salary and as long as the person is in government, he or she will continue to be paid, unless he or she does not do well and gets sacked.
“So, the issue of sustainability, as long as they are ministers of the federal republic, they will continue to pay them from the common pool. And even if the current budget is by the previous administration, their own budget for 2024 will begin to be prepared in October or November, but even with the current budget, they will sustain it. They can also defend it because a lot of indexes were put in place.”
“What about senators? What are they paid? They even earn more than that,” Amaechi said.
Asked, however, about the size of the cabinet, he said, “The cabinet is too large. We thought that this ‘Renewed Hope’ would have merged some ministries; bring two ministries to become one. They did not do that. So, presently constituted, it is too large, very large. And no, not downsizing to address the situation, but rightsizing. Bring like minds, bring them together.
“For instance, three ministries, bring them as one. What are you doing with a major ministry and you have other minor ministries that can easily fit into that major ministry?”
RMFAC had put up a proposal to review the salaries and allowances of public office holders.
The proposal, which was developed during former President Muhammadu Buhari’s tenure, needs the approval of two-thirds of state assemblies before it can be presented to the President for assent.
Ministers currently are entitled to estacode allowance of $900 per night and duty tour allowance of N35,000 per night, and this excludes a refundable vehicle loan of N8.106 million.
Each of the ministers is entitled to a furniture allowance of N6.079 million and severance package of N6.079 million, totalling N12.158 million.
The furniture allowance is paid shortly after their swearing in.
The figure is in tandem with what immediate past ministers earned going by their conditions of service as unveiled by former Secretary to the Government of the Federation, Babachir Lawal, before they were sworn-in in November 2015.
“We need a holistic plan and I am not sure creating 500 ministries will solve any problem in Nigeria. It is only going to fill in the box for political considerations. Some ministries can be fused together”
According to the conditions of service, a minister will earn N2, 026,400 as annual basic salary while a Minister of State will get N1.8 million.
Other highlights of the emoluments include: Estacode Allowance ($900 per night); Utilities Allowance (Telephone/Electricity/ Water) – 30 per cent of Annual Basic Salary (N607,920); Domestic Staff Allowance, 75 per cent of Annual Basic Salary – N1,519,800; Newspaper Allowance, 15 per cent of Annual Basic Salary – N303,960; Duty Tour Allowance, N35,000 per night; Furniture Allowance, 300 per cent of basic salary – N6,079,200; Severance Allowance, 300 per cent of annual basic salary – N6,079,200;
Others are Accommodation Allowance, 200 per cent of annual basic salary – N4,052,800; Motor Vehicle Fuelling Maintenance Allowance, 75 per cent of Annual Basic Salary – N1,519,800; Leave Allowance, 10 per cent of basic salary – N202,640; Personal Assistant Allowance, 25 per cent of Basic Salary – N506,600; Entertainment Allowance, N607,920; Monitoring Allowance, N303,960; and Motor Vehicle Loan, N8,105,600.
The severance package is payable after full tenure of office with the government. The allowance will be pro-rated after a minimum of two years in office.
Each of the ministers is also entitled to N6, 079,200 as furniture allowance, which is paid once in four years. If any of the ministers desires, he or she is also entitled to N8105, 600 as motor vehicle allowance. However, the motor vehicle allowance is a loan repayable by the end of the tenure of the minister.
This is the first time a federal cabinet will be made up of 48 ministers since the return of democracy in the country in 1999.
Tinubu’s immediate predecessor, Muhammadu Buhari, had 42 ministers.
Similarly, in 2011, former President Goodluck Jonathan appointed 33 ministers to his cabinet, nine of whom were carried over from the late President Umaru Yar’Adua’s administration.
The late President Yar’Adua appointed 39 ministers in 2007; while former President Olusegun Obasanjo had 42 ministers in 1999.
The 45 ministers who were sworn-in on August 21 are the Attorney General of the Federation and Minister of Justice, Lateef Fagbemi; Minister of State for Labour and Employment, Nkiruka Onyejeocha; Minister of State Gas in the Ministry of Petroleum Resources, Ekperikpe Ekpo; Minister of Women Affairs, Uju Kennedy; and Minister of Education, Tahir Maman.
Others are the Coordinating Minister of Health and Social Welfare, Ali Pate; Minister of Foreign Affairs, Yusuf Tuggar; Minister of State (Oil), Ministry of Petroleum Resources, Heineken Lokpobiri; Minister of Water Resources and Sanitation, Joseph Utsev; and Minister of Agriculture and Food Security, Abubakar Kyari.
The Minister of Humanitarian Affairs and Poverty Alleviation is Betta Edu, Minister of Sports Development, John Enoh; Minister of Aviation and Aerospace Development, Festus Keyamo; Minister of Works, Dave Umahi; and Minister of Niger Delta Development, Abubakar Momoh.
Others are Minister of Solid Minerals Development, Dele Alake; Minister of Innovation Science and Technology, Uche Nnaji; Minister of Transportation, Alkali Sa’id; Minister of Industry, Trade and Investment, Doris Anite; Minister of Defence, Mohammed Badaru; Minister of State, Housing and Urban Development, Abdullahi Gwarzo; Minister of State, Federal Capital Territory, Mariya Mahmud; Minister of Housing and Urban development, Ahmed Dangiwa; Minister of Art, Culture and Creative Economy, Hannatu Musawa; and Minister of Budget and Economic Planning, Atiku Bagudu.
The Minister of State for Education is Yusuf Sunumu; Minister of Steel Development, Shuaibu Audu; Minister of State for Health and Social Welfare, Tunji Alausa; Minister of Tourism, Lola Ade-John; Minister of State, Police Affairs, Imaan Sulaiman- Ibrahim; Minister of Agriculture and Food Security, Aliyu Sabi Abdullahi; Minister of Information and National Orientation, Muhammed Idris; Minister of State, Environment, Ishak Salako; Minister of Finance and Coordinating Minister of the Economy, Wale Edun; and Minister of Communications, Innovation and Digital Economy, Bosun Tijani.