Fashola and Lagos Shine: A Smokescreen?

Published on 27th October 2014

The thirteenth governor of Lagos State, Babatunde Raji Fashola, SAN, has been hailed for giving Lagos a shine and taming its lawlessness. However, all things being equal, Lagos a predecessor to Hong Kong, is still a slum. Lagos is physically depressing and  lacks most factors used to measure a city of nearly 12m people. Nigeria’s early Governor, General Lord Lugard, left Lagos to start Hong Kong but the two cities are worlds apart.

Lagos State, a state less than 400 square miles - that's 20 miles by 20 miles -  has no sewer/wastewater system. The city/state does not pump nearly 10m gallons of water daily despite its location on the ocean. The state’s infrastructure measured against most cities its size is far below par. Lagos may have a GDP of $43b, if one is a believer in the voo-doo accounting Nigeria uses to shore itself up. Assuming the number is real, how come Lagos State’s budget is less than $3b – {N490b}, and its internally generated revenue is less than 30% of the total budget?

Lagos is still like many less endowed states - dependent on Abuja for its subvention. The state’s 2014 budget allocation for poverty alleviation, whatever that means, is mere N1.366b or an equivalent of $8.3m. Now consider that more than 90% of Lagos state residents are considered dangerously poor, what can $8.3m do? Physically divide up $8.3m among the poor; it comes to less than a dollar. Why anyone celebrates this misery sum baffles one. You be the judge.

Nigerians are persuaded by volume of money but not its utility and usefulness in addressing their basic needs. The culture of money clouds the right sense to ask probing questions. No wonder, the world’s most populous black nation is run like a ‘petty cash’ operation. Lagos State spends almost half of its budget on recurrent expenses; a bloated and unduly enlarged state bureaucracy that does nothing except to extort and torment residents.

If Gov. Fashola were a reasoning and seasoned good administrator deploying the tools of public finance models for judicious use of state resources, he would strive to keep the state’s recurrent expenditure at less than 35%, with a Rainy Day Account requirements written into law of say 3% of annual budget as set aside. But as it is, Lagos does not have $1b in its reserve given the combined budget since 1999. It is a Pay-As-You-Go budget system relying and depending on windfalls and cash. When no item in the budget goes unfunded, it is scrapped. A Fair Weather budgeting system.
 
Surprisingly, the 2014 budget is less than 2013 budget by 3.5%, and one wonders how the shortfall is accommodated - by borrowing or using reserve fund as cushion? If Lagos state’s 2014 budget is less than the 2013 budget, how does that compare with Nigeria Finance Minister Madam Ngozi Okonjo-Iweala’s sermons on the mountain on how well Nigeria is doing? Isn’t Lagos in Nigeria, and its mega city? Lagos should be the benchmark for Nigeria’s pulse on the economy and its purse ought to reflect what the nation is doing. As goes Lagos, so goes Nigeria. Go figure. When the numbers are massaged, it betrays and conflicts with the propaganda on Nigeria Rising and being the largest economy in Africa. May be so, but like US Missouri – Show Me State – ‘Show Us The Money.’
 
Were Lagos to run properly given its undue advantage as the heartthrob of Nigeria, its budget should be accounting for more than 60% coming from internal sources. The state's budget for education is $312m and $132m for health. For 12m people, that is really no money to address the mounting and pressing needs. Note, Lagos state covers only less than 400 square miles, so by its size – physically speaking, it has a comparative advantage such that properly deployed resources will get a bigger bang.
 
In Nigeria where half measures are celebrated, no one is critical of the leadership. Instead the dance in the square takes over as praises are showered. No doubt Gov. Fashola is the best of 'airy' governors that run amok in Nigeria. But he is Governor of Lagos, a city/state that has existed for more than 100 years. Neither Gov. Fashola nor anyone before or after him used effective public financing and budgetary tools to measure how well they are doing.
 
Municipal financing indicates that out of every $1b budget, there is a redundancy, waste and load factor of 15%, meaning $150m is considered wasted. This is the case in developed nations. In Nigeria, where the waste factor runs higher because of procurement policies that awards contracts for the money and not the project, the waste factor in Nigeria is about 75%. As a result, the expected benefit is about 25% Nigerians get out of public resources. It is already a telling indicator when a state spends nearly half of its budget on recurrent expenditures.
 
On public safety, since the role is reserved for Nigeria Police, it is hard to challenge a state government on crime stats and type of crimes committed. Given that Nigeria Police is seriously handicapped with resources and some states provide nominal support, one is in conflict on who to give credit on crime reduction. There is a correlation between economic wellbeing and public safely. Nigeria’s leadership is clueless on such a correlation. If not, why is Nigeria Police still a first generation police trying to solve crimes in 21st century using outdated and inefficient tools?
 
It will take uninterrupted and aggressive programs, policies and years devoid of pettiness and personality politics for Lagos to achieve an ‘Average’ or solid ‘C’ grade. Let's look to 25 years from now before Lagos can be considered Average. If Gov. Fashola is to be celebrated, it should be based on policies and programs set now which will keep Lagos moving forward after him. If not, it will be the quicksand success stories Nigerians enjoy only for them to come back way behind where they started. Recycling themselves without throwing off new and improved ways to stretch public resources for better outcome.
 
Lagos may be the best in Nigeria, her local champion, but we know local champions often do not make the international cut. In ranking cities with Lagos type of demographic, Lagos is dead last. And given Nigerians sense that no one should say its ‘mama's soup is not sour, even when it stinks, the malfeasance and maladministration are endless. See no evil and dare not speak of it even as it stares one on the face daily. ‘God Dey’ appears the best and only answers Nigerians default to address human deficiencies in their collective existence. Really?
 
Until Nigerians/Lagosians become very critical of their leadership – demanding more and pushing the envelope, the half measures provided and politicians like former Gov. Tinubu who is considered a ‘super star’ will keep doing their nonsense and squandering the opportunity for their state and the hapless 165m Nigerians held captive by errant leadership that President Obama, recently called a ‘basket.' Throw in the ‘beer parlor chants and chest pounding culture’ marooned and tortured by alcohol induced senses since Guinness and NBL products are some of the highest trading stocks on Nigeria Stock Exchange, what does one end up with? Your guess is as good as mine, assuming your mind is straight.
 
By Ejike E. Okpa II 
Dallas, Texas.


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