There are lots to be read into the recent report by the Fiscal Responsibility Commission on the debt profile of various state governments in 2016. According to the Punch of March 20 2018, which reported extensively on the report, the debt profiles of about 18 states exceeded their gross and net revenues by more than 200 per cent.

The paper quoted the FRC as saying that the debt may have increased by 2017 since “there was no effort by the states to clear them”. It also quoted the FRC as saying that the development was contrary to the guidelines of the Debt Management Office on debt sustainability, which recommends that the debt status of each state should not exceed 50 per cent of the statutory revenue in the previous 12 months.

“In the light of the DMO’s guidelines on the Debt Management Framework, specifically, sections 222 to 273 of the Investment and Securities Act, 2007 pertaining to debt sustainability, according to the guidelines, the debt to income ratio of states should not exceed 50 per cent of the statutory revenue for the preceding 12 months,” the FRC was quoted as saying.

Analysis of the FRC report (which was based on the debt profile of the states as of December 31, 2016) showed that most of the states of the federation flouted the regulation as they exceeded their debt to revenue ratio by more than 100 per cent. According to the report, the worst offenders were Lagos (670.42 per cent), Osun (539.25 per cent), Cross River (486.49 per cent), Plateau (342.01 per cent), Oyo (339.56 per cent), Ekiti (339.34 per cent), Ogun (329.47 per cent), Kaduna (297.26 per cent) and Imo (292.82 per cent). Others were Edo (270.8 per cent), Adamawa (261.96 per cent), Delta (259.63 per cent), Bauchi (250.75 per cent), Nasarawa (250.36 per cent), Kogi (221.92 per cent), Enugu (207.49 per cent), Zamfara (204.91 per cent), and Kano (202.61 per cent).

According to the report, the debt to net revenue of the states puts some of the states in even more precarious situation. For instance while the debt to net revenue of Lagos State is a whopping 930.96 per cent that of Cross Rivers State is 940.64 per cent.

The report found that the only states whose debts did not exceed the recommended 50 per cent ratio by more than 100 per cent were Anambra, Borno, Jigawa, Kebbi, Sokoto, Yobe and the Federal Capital Territory.

Several extrapolations could be made from the above set of frightening figures:

One, the amount of revenue accruing to a state has no relationship with its debt profile.  For instance Lagos  State which has the highest debt to gross revenue ratio of 670.42 per cent (and  debt to net revenue of 930.96 per cent),   is one of the highest receivers of  funds from the Federation Account. It has also one of the best internally generated revenue profiles (thanks in part to the location of prime businesses there).

In September 2017 for instance, it received from the Federation Account N8.8bn, compared to say Borno and Anambra which received less than half of what it got from the Federation Account alone during the period and yet stayed within the recommended 50 per cent to revenue ratio. Remarkably none of the top receivers of funds from the Federation Account – Akwa Ibom, Delta, Rivers, Bayelsa, Kano and Kaduna States – made it in the ‘honours’ list.

In fact the states whose debt did not exceed the recommended 50 per cent ratio by more than 100 per cent according to FRC received the following sums in September 2017 from the Federation Account (I am using a random month and year for which data on what was received by all the states are available): Anambra (N4.3bn), Borno (N4.9bn), Jigawa, (N4.67) Kebbi (N4.26), Sokoto (N4.1bn), Yobe (N4.15bn).

In contrast, the top receivers of funds, which did not make the ‘honours’ list received the following sums during the period: Delta (N14.2), Akwa Ibom (N12.94bn), Rivers (N12.45bn), Kano (N6.8bn) and Kaduna (N5.4bn). In the same vein, Osun, which is the poorest state in the country in terms of sums received from the Federation Account, (it got only N1.6bn during the period) was not listed among the states with the highest debt to gross revenue ratios. One of the conclusions from this would be the wise words of Benjamin Franklin, one of the founding fathers of the USA: “Money never made a man happy yet, nor will it. The more a man has, the more he wants. Instead of filling a vacuum, it makes one.”

Two,  a survey published in May 2017  by BudGIT, (a civic organisation founded in 2011to simplify the budget and matters of public spending for citizens), found that most states, including some top receivers of funds from the Federation Account and many heavily indebted states, owed workers arrears in salary and pension payments. Among the States which it found were not owing salaries were Anambra, Borno, Akwa Ibom, Cross River, Kaduna, Kano, Kebbi, Lagos, Plateau, Sokoto and Yobe.

Remarkably while rich Delta State and Bayelsa States owed upwards of six months salaries, Yobe, Kebbi and Anambra which receive less than half of what they get from the Federation Account did not owe any salary arrears.  The above raises the question of whether revenues accruing to states are good indicators of the viability of states. It will seem from the above that the capacity for governance and managing resources may be better indicators of state viability than the quantum of money that flows to states.

Three, while oil money controlled by the federal government has made it the central site of the intra elite struggles for power and privileges, a commensurate attention is not paid at what happens at the state levels. In fact while the country’s democracy is in a transition mode at the federal level, it appears to be suffering from arrested development at the state levels. Just consider these: In Imo state, which was found by BudGIT to owe primary school teachers two months arrears of salary and pensioners 24 months arrears in May 2017, the government strangely found enough resources to build statutes of personalities that caught his fancy, including that of Jacob Zuma, former President of South Africa, who is now facing corruption charges in his country. The same Governor gave the ministerial slot for his state to his father-in-law and is now pushing for his son in-law to succeed him.

In Kaduna state, an otherwise smart governor had to pull down a house belonging to his political opponent. In virtually all the States, the Governors behave like monarchs rather than elected executives that are accountable to the electorate.  Is there any State in the country where the State House of Assembly is not a rubber stamp of the Governor? Is it possible for a State Governor to lose a court case in the State’s High Court? Can the party of a state Governor lose Local Government elections in the State? Compared to what is happening at the state level, the federal government seems to be doing well.

Four, what the different ethnic and regional factions of the political class demand from the federal government, they often negate when it comes to their own states. For instance, while we all extol the unwritten power rotation agreement between the Northern and Southern parts of the country, will it be a crime for the politicians to respect the same principle in their states? Will it for instance be a crime for a power rotation arrangement in Benue, Kaduna, Taraba and several other states in the country so that all the key constituents of a State will have a good opportunity of producing the Governor of the State? Several states in the country need restructuring, not just the federal government.

 The hullabaloo over Senators’ N13.5m monthly ‘running cost’

The recent revelation by Senator Shehu Sani (Kaduna Central) that each Senator receives the whopping sum of N13.5m as running cost – on top of N700,000 monthly consolidated salary and allowances  –  has led to justified anger in the land. I join in condemnation of bogus payments. But I will like also to put a caveat: several comparisons of what the Senators earn with what their counterparts earn in Europe, USA and elsewhere earn,  miss the context.  The truth is that the electorate in Nigeria (and virtually all parts of Africa) are manifestly different from their European and American counterparts.

For instance while the constituents of a Nigerian Senator expect him or her to attend funerals, naming ceremonies and launchings of all hues and to be among the highest donors in such events, there are no such expectations on their American and European counterparts. Nigerian Senators, like political office holders,  are also expected to become cash cows and to donate handsomely wherever they go and their presence is acknowledged including in churches and mosques.

This is not a justification for any jumbo pay when most Nigerians are just trying to scrape by but to give a sense of proportion to the conversation.

Again, it is important for us to compare like-for-like. So if we are justifiably angry at what Senators take home every month, we must also know how much top members of the executive and the judiciary take home – in consolidated monthly salary and monthly ‘running cost’.

The author is Jideofor ADIBE.  Email: pcjadibe@yahoo.com   and Twitter: @JideoforAdibe. Originally published by Proshare Nigeria on 23 March 2018

As a bespoke agribusiness summit in Brussels draws near and attracting an enviable line-up of industry practitioners, the question of the shrinking flow of public financial resources to developing economies is taking centrestage one again. This time around, it is seen more from the perspective of a blessing rather than a curse if you consider that private equity flow to markets in the Sub-Sahara African economy is actually on the rise. Those who have long held that Africa needs trade rather than aid, appear to be winning the debate while the less aggressive business risk takers are suing for caution.

I shall be making the case at the Summit for Blended Finance as one of the few instruments tailor-made for businesses that favour a more prudent finance approach. I shall be introducing the model of blended finance, put simply, as the interface between the significantly decreased development finance and private philantropic funds deployed as seed capital in activating financial flows for activities destined for or emanating from Sub-Sahara Africa. The focus of activities will be the West Flanders Belgium rich food, beverage and pharmaceutical industries including machineries and engineering activities for these industries.

Some of the ready questions that come to mind are: which are these funds, where are they located, what are the criteria for accessing them and how could they be deployed? Placing these and other questions at the core of the discourse, the presentation walks participants through blended Iroko Trade Invest finance opportunities for deal brokerage activities in the Food, Beverage & Pharmaceuticals industries emanating from or destined for Nigeria and other Sub-Sahara African markets in their trade with firms within the Western European market with West Flanders, Belgium as hub.

The speakers line-up, programme and registration for the Summit, which targets only 70 participants are available here

The fact that there are tendencies for reform inside the European Union gives a ray of hope. Kaldor was kind to humanity when she speculated that if a Corbyn-led Labour Party were to win the next election, there is a unique – indeed a once in a lifetime opportunity – to reform the European Union and this means an opportunity to save Britain, Europe and perhaps the world.

But the British are madly obsessed with the domestic British debate despite all the talk of a global Britain that nobody seems to be discussing or trying to diagnose the frightening scenario of everything going wrong and their role in that scenario. The current nostalgia for Britain’s role in WWII seems to neglect the fact that this was a struggle for democracy, human rights and decency and not just about nationalism. “If we care about those values now” she postulated “we should be worrying about the future of Europe and the world and how what happens in the rest of the world will affect us”

A recent pamphlet published by Another Europe is Possible makes the argument that instead of fretting about how bad Brexit will be for Britain, there is a need to think about what a Corbyn government inside Europe might mean for the future of the European Union. The pamphlet sets out a reform strategy for the European Union that is realistic to achieve if a Corbyn government were to ally with socialists across Europe. Indications are that such reform strategy would enable Britain to address the big global problems of today, and this in turn may well be a necessary condition for implementing the Corbyn-McDonnell plan of action.

Exit of neo-liberal dogmas through the Kaldor lenses

There are already tentative moves away from dogmatic neo-liberal economic policies, which successive UK governments were at the forefront of pushing. President Macron is talking about reform of the eurozone including a common European budget and there is a possibility that his proposals will be met more warmly by the new Social Democrat Coalition in Germany.

The left-wing Portuguese government has demonstrated how an anti-austerity policy can dramatically improve economic performance. There are proposals to close tax havens for multinational corporations and a proposal for a common consolidated corporate tax, something the UK has strongly opposed in the past.

New proposals to stop undercutting, whereby companies deliberately recruit workers abroad under the conditions in the countries where they are recruited to reduce costs, have just been passed and will mean that it will be no longer possible to use migrant workers as a way of putting downward pressure on wages.

And there are proposals for a tax on financial transactions as a way of controlling financial speculation, again a proposal vetoed by the UK in the past. Yet these proposals may be difficult to implement without at least one major power seriously committed to them. For example, in the wake of Brexit, some countries are engaging in beggar-my-neighbour policies in order to take over the UK position especially in financial services. A Corbyn-led government could be key to making these reforms happen.

The same is true for those areas where EU policy has, in the past, been relatively progressive – digital rights, climate change, and ending global conflicts, for example. Thanks to active protests across Europe, EU policy on digital rights, defending online privacy and the ownership of personal data, has been rather progressive – yet without continued active engagement, along the lines of the Labour Party’s Digital Democracy Manifesto, there is a risk that this might be undermined by anti-terror legislation.

In the case of climate change, there is considerable momentum for far-reaching efforts to keep climate change under 2 % including the ‘Clean Energy Package for All Europeans’ and the ‘EU Roadmap for 100% emission cuts by mid-century. These initiatives would mean a massive transformation of the European economy affecting almost every sector. But, given powerful vested interests in our current carbon based economy, it won’t happen without substantial pressures from parties and movements across Europe.

Humane & managed migration policy

As for ending global conflicts, the new global strategy  presented by Federica Mogherini to the European Council the day after the British referendum, envisages an external security policy aimed at human security (the security of people and the communities in which they live) rather the security of borders. This policy was formerly blocked by the UK who preferred the geo-political approach of NATO and so is now moving ahead. Nevertheless, it requires much stronger political backing and more of the kind of resources in which the UK has a comparative advantage.

Finally, a Corbyn-led government could change the conversation about immigration. Anti-immigration sentiment promoted by unscrupulous politicians, it can be argued, produced the refugee crisis. We live in a world of migration and it is more or less impossible to control. What is more Europe with its aging population needs migrants. Instead of creating a border security complex in which smugglers and border guards are enmeshed in an impossible business that fails to prevent the deaths of thousands of migrants in the Mediterranean, we need a policy of managed migration as was actually proposed by the European Commission but opposed by member states – one that involves a resettlement policy across the continent. A Corbyn-led government could push for replacing  the current exclusive and dangerous securitised approach with one based on humanitarian and development considerations.

A reform strategy of this kind offers the possibility of transforming the global model of development from the old US-led model based on mass production and the intensive use of oil, to a new green, digital, decentralised and socially just set of arrangements.

This is no longer, if it ever was, something that can be pursued in one country. On the contrary, a post-Brexit Labour government could easily be derailed by predatory action from larger economic blocs and financial markets. And the alarming tendencies for European disintegration, right-wing authoritarianism not to mention criminal and ethnic violence are likely to infect us as well. But if Labour were to pursue a ‘Remain and Reform’ strategy, there is a chance to remake Europe and initiate a process of taming and controlling the dark forces of globalisation.

*Inspired by and based on a pamphlet first published in Open Democracy by Professor Mary Kaldor entitled “What could a Corbyn government inside Europe mean for the future of the European Union?”

At the lobby of a hotel in Asaba, Delta State, Nigeria where I had taken my two teenage sons to, a few years back, for an Anioma art exhibition as part of our occasional family cultural homecoming, laid a copy of a magazine ‘Anioma Essence’. A read, piece by piece of the articles contained in the magazine, was my first encounter with Emeka Esogbue, editor of the magazine.  On further enquiry, the ‘Pen Master’ as he turned out to be known and fondly called, is my Isieke-Umuekea Village kinsman in Igbuzo, a historian and avid writer. A Diaspora friend and kinsman of the Enuani (Anioma) stock based in the United States of America would later do me the pleasure in July 2017 of presenting me a Birthday gift; a book entitled ‘Essentials of Anioma History’ by no other than the Pen Master himself. I have since enlarged my list of prospective books acquisition to enrich my personal library to include other works of the Pen Master, which I had earlier borrowed and read. These are: “A Study of the Origins and Migrations of Anioma Settlements” and “A Short History of Omu”.

Being away from home for more than two decades and half, one begins to suffer what National Geographic Society’s Explorer-in-Residence Wade Davis called the “erosion of the ethnosphere.” Along with language, one also begins to lose touch with the arts, crafts, vocational skills, folklore, and customs of his traditional and indigenous peoples. Works such as those by Emeka Esogbue are for me a means of staying connected to my Igbuzo, Anioma heritage. Despite best efforts, the longer you are away from home the more the propensity for the culture, history and heritage to erode you. Ironically for me, my appreciation of the same heritage grows more at the same time. Next to Nna, my father and living encyclopedia of Igbuzo history, I have found the works of Emeka Esogbue immeasurable sources of knowledge of not only our history but also our traditions and customs. I would always dip into his work to arm myself for my numerous discussions and debates with my sons, now in their early twenties, who remain eager to sort out the cultural conflicts that come with been born abroad yet connected deeply to your roots. I would always tell them especially when I appear to be losing the debate to commonsense that you can’t logically disagree with something or an issue that you have no firm grasp of. The works of Emeka Esogbue help me to grasp the essence of the Igbuzo, Anioma history. I disagree with some isolated aspects of the customs but understanding them help me appreciate them. This is to a large extent because in his writings, Emeka Esogbue does not simply chronicle them as most historians before him would do, he interprets them.

Emeka Esogbue deploys a writing style that is refreshing. He is first and foremost a historian. Reading records is therefore his point of departure. But what he does with the records actually marks him out from his peers. He is far from what I refer to as ‘historian of chronicles’ where a report is simply given on what a historian finds and informs the wider world about the past usually arranged in chronological order and providing no further comments or discussions.

I guess what I find most invaluable in the work of Emeka Esogbue is his uncommon realization that historical records that survive for most periods of history are both incomplete and often contradictory. Take the case of the origin of the people of Igbuzo as example. The Pen Master’s position on this important issue is perhaps the most intelligent attempt so far in addressing the gaps and contradictions in the existing accounts. His interpretative skills in addressing historical gaps and contradictions have placed him a notch above his generation of historians and authors.

Collins NWEKE