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A former minister of finance, Olusegun Aganga, has called for the reduction in the cost of governance in Nigeria.
Aganga, who also served as minister of trade and investment under former president, Goodluck Jonathan, said the COVID-19 pandemic is a unique opportunity for the country to make needed structural changes.
In an interview with The Punch, he said Nigeria failed to save for a rainy day, and would need to cut the cost of governance to meet its needs.
“My first focus will be to cut and control costs in a significant way. Cut the wastages, block revenue leakages, and take this unique opportunity to cut the cost of governance,” he added.
This comes days after former vice president, Atiku Abubakar similarly called for a slash in government expenditure, especially for public office holders.
“The billions budgeted for the travels and feeding of the President and Vice President has to be reduced. The ₦27 billion budget for the renovation of the National Assembly has to go,” Atiku said.
“The massive budgets to run both the Presidency and the Legislature has to be downsized. The budget for purchasing luxury cars for the President, his vice, and other political office holders must be abandoned.
Aganga also quipped that the presidential system is expensive for the country to afford.
“We all know that the presidential system of governance is an expensive one. And we now know we cannot afford it,” he said.
“This is a unique opportunity to make certain structural changes; we should not miss the opportunity. History will judge us well if we did. We also need to reprioritise spending and improve the quality of our spending.
“When we talk about sources of finance for the economy as opposed to the budget, there are four main sources. The first is the government-sourced revenue including loans.
“This is limited now but if we make our case well and we are seen to have taken some tough measures already, we may be able to access some grants, soft loans. I believe the government is already doing this. But expect revenues from taxes, customs, and value added tax to fall.”
Commenting on the crash in global crude oil price, the pandemic and its effect in the country, the former finance minister stated: “We were already heading for a tough time pre-COVID-19, but I expect it to be much tougher now because of the twin effects of COVID-19 and the significant and sustained fall in oil price.
“The glut is going to hit Nigeria harder because we do not have any refining capacity or solid long-term oil contracts as the Saudis have with China and we are almost entirely dependent on oil revenues to support our budget and reserves.”
