By Henry Odeh
Nigeria’s former vice president, Alhaji Atiku Abubakar has said that the current recession could have been avoided if President Muhammadu Buhari had heeded to advice given to him by prominent Nigerians including himself.
Recall that sunrisebulletin.com had earlier reported that Nigeria has entered its second recession in five years, according to the Gross Domestic Product (GDP) report published by the National Bureau of Statistics (NBS) on Saturday, November 21.
According to NBS, the GDP recorded a contraction of 3.62 percent in the third quarter of 2020. In his reaction, Atiku said that the recession could have been avoided if the President Buhari-led government had taken three key steps he advised.
The steps FG failed to take which led to recession according to Atiku
1. Cutting the cost of governance
2. Saving for a rainy day
3. Avoiding profligate borrowing/prudent management of our economy.
Atiku, however, admitted that the coronavirus pandemic exacerbated the country’s slide into the recession.
The former vice president proceeded to highlight some steps the Nigerian government should take to exit the recession.
The proposed solutions include:
1. Removal of non-essential line item in the proposed 2021 budget Atiku said the proposed 2021 budget presented to the National Assembly is no longer tenable, adding that Nigeria neither has the resources nor the need to implement such a luxury heavy budget.
Line items Atiku recommended to be expunged from the 2021 budget include estacodes, non-emergency travel, feeding, welfare packages, overseas training, new vehicle purchases, office upgrades, non-salary allowances, etc.
2. Investment in human development to stimulate the economy
The presidential candidate of the Peoples Democratic Party (PDP) in the 2019 elections further advised the government to stimulate the economy by investing in human development and increasing the purchasing power of the most vulnerable of our population.
He said special attention should be given to the poorest of the poor to ensure that they do not slip further into extreme poverty.
Atiku recommended 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.
3. Funding the stimulus package with luxury tax.
To fund the stimulus package, the former VP proposed that government should not resort to borrowing. He instead proposed a luxury tax on goods and services that are exclusively accessible only to the super-wealthy.
He said proceeds from the 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.
4. One percent poverty alleviation tax,
Atiku also proposed that a one percent poverty alleviation tax should be legislated by the National Assembly on the profits of international oil companies operating in Nigeria and international airlines doing business in the country.
The proceeds, according to Atiku, should also go to the proposed Poverty Eradication Fund.
5. Reduction of the cost of goods and services that affect the poor The PDP leader also advised the Buhari-led government to work on reducing the cost of goods and services that affect the poor.
6. Suspension of borrowing,
Lastly, Atiku advised the Nigerian government to stop borrowing for anything other than essential needs.
He concluded by stating: “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.”
