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24 states can’t pay salaries without FG allocation – Budgets

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24 states can’t pay salaries without FG allocation – Budgets

At least 24 states of the federation will not be able to pay workers salaries this year without having to wait for federal allocations from the central government, findings by The According have revealed.

Only 11 out of the 36 state governments of the federation can independently pay their workers’ salaries without depending on federal allocations, according to an analysis of the state governments’ approved budgets for the 2024 fiscal year.

The states with robust internal revenue are Lagos, Kano, Anambra, Edo, Enugu, Imo, Kaduna, Kwara, Osun, Ogun and Zamfara.

The approved budgets are also contained in Open States, a BudgIT-backed website that serves as a repository of government budget data.

While the budgets of 35 states have been made public, Rivers State budget could not be accessed neither has it also been uploaded the platform.

According to the analysis the budgets data, 24 states cannot fund salaries payments from their Internally-Generated Revenue and, as such, may have to rely on the Federal Government allocations or borrowing from banks and related institutions.

The development also means that the respective wage bills of the affected states surpassed their various IGRs, raising concerns about workers productivity and state governments’ efficiency in internal revenue generation.

The 24 states are Bayelsa, Ondo, Yobe, Sokoto, Taraba, Plateau, Oyo, Niger, Nasarawa, Kogi, Kebbi, Katsina, Jigawa, Gombe, Ekiti, Ebonyi, Borno, Benue, Bauchi, Adamawa, Akwa-Ibom, Cross River, Abia, and Delta.

The development is coming amidst clamour for wage increase by labour unions at both the federal and state levels, following the rising cost of living on the aftermath of fuel subsidy removal and unification of the foreign exchange markets by the current administration.

The Nigerian Labour Congress has consistently maintained that if inflation continues to rise, the organised labour may have no choice but to insist on a new minimum wage of N1m for Nigerian workers. The government however has rejected the demand.

In the first half of 2023, state governments borrowed about N46.17bn from three banks to pay salaries between January and June 2023. The findings were based on an analysis of the half-year 2023 financial statements of Access Bank Plc, Fidelity Bank, and Zenith Bank Plc

The According observed that the states borrowed the most from Access Bank in six months, with a record of N42.97bn loan.

This was followed by Zenith Bank (N1.78bn borrowed) and Fidelity Bank (N1.42bn borrowed) within the six-month period.

In 2023, state governors got the most FAAC allocations in at least seven years. The rise in FAAC allocations to the three tiers of government especially states followed the petrol subsidy removal and currency reforms of the current administration. The reforms have reportedly led to a 40 per cent boost in income.

Experts believe the projected revenue increase should have reduced state governments’ appetite for more borrowings.

In an interview recently, Kaduna State Governor, Uba Sani, claimed that state governments were borrowing to salaries in the past but the removal of fuel subsidies had put an end to such borrowing.

“Every governor in Nigeria is getting more money than we used to get. Before President Bola Tinubu removed the fuel subsidy, in Kaduna State, precisely in May 2023, we were borrowing to pay salaries but immediately after the subsidy removal, after paying salaries without borrowing, we had a surplus of money.”

However, despite the improved funding, no fewer than 32 states indicated plans to borrow N2.78tn from domestic and external institutions to fund their 2024 budget.

According to further analysis of the states budgets, the affected 24 states will spend N1.48tn on salaries in 2024, while they plan to make N914bn IGR. This means the states will need N566bn from either federal allocations or borrowing to complete the payment of salaries.

The breakdown of data shows that Bayelsa State with projected IGR of N23.9bn will need money to pay its workers N69.12bn this year. Ondo State with projected internal revenue of N33.6bn will also need extra money to fund its N56.76bn annual wage bill, while Yobe State will fund its N42.86bn wage bill from its projected IGR of N14.55bn and federal allocation or borrowing.

Sokoto is expected to pay N46.9bn salaries from its anticipated internal revenue of N37.1bn and partial funding from allocation/loan, while Taraba will obtain extra funding to pay its workers N54.47bn from its internal revenue of N27.8bn. Plateau with a projected revenue of N38.89bn must get federal government allocation o clear its wage bill of N52.25bn.

Also, the Oyo State will pay N132.67bn to workers after generating N92.79bn in its coffers. The state will need additional funding to complete this. Niger State with projected revenue of N61.87bn will need help to pay its civil servants N70.24bn while Nasarawa will pay its workers N54.45bn from its projected revenue of N43.3bn and another source.

Further analysis of the budget showed that states such as Kogi will pay its workers N65.07bn from its revenue of N30.23bn and federal allocation, while Kebbi will pay N37.3bn as salaries from its N17.8bn internal revenue and partial federal allocation. Katsina will spend N56.3bn on salaries from its N40bn internal revenue and federal allocation, while Jigawa will pay its workers N64.84bn from its revenue of N50.64bn and federal allocation.

 Gombe must pay salaries worth N35.27bn from its anticipated revenue of N22.32bn and federal allocation. Ekiti will spend N2.78bn on salaries from its N1.5bn revenue and federal allocation. Ebonyi’s N28.16bn wage bill surpasses its revenue of N25.1bn, while Borno will pay its workers N50.28bn from its revenue of N27.5bn and federal allocation.

Furthermore, Benue State with revenue of N23.9bn will pay N56.9bn as salaries, while Bauchi must pay salaries worth N46.9bn from its anticipated revenue of N37.1bn and federal allocation; Adamawa will spend N52bn on salaries from its N26.9bn revenue and allocation; Akwa-Ibom will spend N127.8bn on salaries from its N60bn revenue and allocation while Delta with projected revenue of N110.3bn must seek assistance to pay its workers N164.3bn.

Also, Abia with a revenue of N32.14bn will pay N47.83bn as salaries while Cross Rivers with projected revenue of N34.7bn must seek assistance to pay its workers N67.75bn.

According to the budget data, the 11 states which have higher IGR will conveniently fund their combined 980.68bn wage will their internal revenue of N2.34trn

Experts speak

In different forums, financial experts have raised concerns about states’ spending on recurrent expenditure highlighting the need to embrace financial innovations.

A development economist, Aliyu Ilias, said many states had yet to fully develop themselves as industrialised and marketable to attract investors.

Ilias urged governors to develop an area of strength they could leverage to attract foreign investments.

He said, “Going forward, what they could do is to identify one area of strength. For instance, Bayelsa has oil and should be able to attract investments. I think it is about policy. They should give the policy a chance that would allow people to come and invest. They should also create an attraction and develop an economic summit that will make sure they showcase and attract investors.”

An economist and former Vice-Chancellor of the University of Uyo, Prof Akpan Ekpo, also stressed that, “states have to think of new ways of increasing their IGRs. If they continue borrowing to pay salaries, it is not good for the economy.”

He urged the states to increase their revenue by increasing service delivery, which will attract more revenue.

Also reacting, the Managing Director of the Centre for the Promotion of Private Enterprise, Muda Yusuf, said that the report indicated that a majority of states were not financially sustainable and were at risk of insolvency if there was no boost in investment.

He said, “This issue is a fiscal sustainability problem, showing that many states are not fiscally sustainable and need to work towards it; and that the states need to do a lot more to attract more investments to their states so that their level of dependence on the Federal Allocation Accounts Committee would reduce.

“Even as we speak, many of them are also in debt and by the time they pay salaries and service their debts, there is not much left to improve on infrastructure. It’s in the interest of the sustainability of the states for them to be more creative in generating more revenue and attracting more investment to their states so that they can generate more revenue.

“Secondly, we also need to address the issue of fiscal federalism because some of the states don’t have power over some resources in their domain and can’t bring investors into it. For instance, mining is controlled mainly by the federal government, you get permission from them and revenue is remitted to them. So we need to revisit the issue of restructuring to help states have more control over resources within their domain.

Continuing, the economist stated that the state governors should take a cue from the Federal Government to reduce its bloated staff and political appointees.

“Most of these states have heavy overhead and they have very bloated bureaucracy, political appointees and they are putting a lot of pressure on their resources, so they have to do some rationalisation on their staff, many of them don’t need more than 50 per cent of their workforce but for political reasons, they put all manner of characters on their payroll including the local government. They have to look at that and take a cue from the Federal Government on the Oronsaye report.”

Lagos Computer Village vendors fear revenue loss amid relocation

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Lagos Computer Village vendors fear revenue loss amid relocation

The plan to relocate Lagos Computer Village from Ikeja to Katangua in the Abule-Egba axis of the city has triggered fear of revenue loss among gadget vendors, JOSEPHINE OGUNDEJI writes

Computer Village, nestled in the heart of Ikeja, Lagos, is the technology hub for the Sub-Saharan region. It is the go-to destination for the latest gadgets and reliable repairs.

The significance of Computer Village extends beyond its role as a marketplace. It catalyses Nigeria’s technological advancement, fostering entrepreneurship, driving economic growth, and facilitating access to cutting-edge technology.

However, despite the significance of Computer Village to the country’s technological innovations, its location has been a source of the Lagos State Government, residents and road users in that part of the city. Traffic congestion clogs the streets surrounding the market, impeding business operations and road users. The lack of parking facilities exacerbates the challenge.

Genesis of relocation plan

In 2017, the Lagos State Government during a press briefing announced plans to relocate Computer Village to decongest the capital of the state.

It said the relocation was aimed at curbing environmental degradation, housing stock deficit, and traffic congestion in the state capital.

“The relocation will curb environmental degradation, housing stock deficit, and traffic congestion in the Ikeja axis,” the state government noted.

In 2021, Bridgeways Global Projects Limited, the contractor in charge of the new Computer Village, announced that the first phase of the new ICT market would be completed in 24 months.

The new Computer Village would be called the Katangua Information and Communications Technology Business Park. The Chief Executive Officer of Bridgeways Global Projects, Jimmy Onyemenam, explained that the new area would provide infrastructure for the manufacturing of technology hardware.

“The Katangua ICT Business Park will also provide the infrastructure to incubate and accelerate the development of technology solutions that can improve development outcomes in Africa.”

According to numerous reports, the project was expected to cost about N40bn. The President of the Phone and Allied Product Dealers Association of Nigeria, Ifeanyi Akubue, stated that the project had been slow-paced.

He explained that the project’s site had been fenced and the foundation for some buildings had been erected.

He stated, “The developer and the market are working towards the project but there has been a delay. I don’t know why there is a delay because the traders are not the ones in charge. It was contracted to a developer. The developer revealed at the launch of the project that in 24 months the site would be ready”

However, the Managing Partner of Bodds IT Solutions, Emmanuel Osho, disclosed that a lot of traders were not happy with the planned relocation of Computer Village as it would impact their businesses negatively.

He explained that the current slow pace of the project was because certain bigwigs in the market were kicking against it.

He said, “I am not in support of the move and a lot of traders are not excited about it, a lot of people like where the market is located.

“Moving the market means we would be farther from central Lagos, meaning a lot of people would have to spend a lot of time to get to their workplaces. Also, people would have to think twice before they plan to come to do business with us.

“Ikeja is in central Lagos. Now, imagine they need to come to our new location from the Island. Ikeja was already stressful, but this will be an added stress for them and the shop owners. People that are situated in Ikeja would have to be shuttling between Ikeja and Katangora.

“What will make sense is to try to move people to central concentrations within the market. That is what makes sense. A lot of bigwigs do not want to move, and this is slowing down the project, they are fighting it in their way.”

The Public Relations Officer of the Computer and Allied Product Dealers Association of Nigeria, Solagbade Olaifa, told The According that Computer Village was situated in an area that wasn’t intentionally designed to be a market.

He said, “The market sprang up as a result of its centrality and in response to the demand for technological devices. However, all this is about to change as the Lagos State Government has since announced plans to relocate the market from its present location to Katangua in Abule Egba to solve traffic congestion and environmental problems in the area.”

Vendors voice concerns

Vendors market had decried the relocation of the gadget market from Ikeja to Katangua in Abule-Egba.

In an exclusive interview with The According, a phone seller, Bolaji Amos, expressed concerns about the potential loss of customers due to the relocation.

He said, “Most of our customers come from the Island and it is not easy connecting Katangua from the Island. The sale of goods would decline drastically, and people would lose their jobs.   This relocation would spoil business because people prefer to come because there is security. How do they want to cope with the dumping site at Katangua?

“AAbule-Egba is very far and to connect it won’t be easy for customers. People would be scared because of the slum, where bad boys are taking hard drugs and there are lots of hoodlums flocking that area.”

Voicing his displeasure, an engineer and a seller of electronics, Razaq Dosunmu, said Computer Village is well known for the sale of electronics and gadgets. Going to a new location to start the business from scratch is of great concern.”

A gadget seller, Austin Onyeka, highlighted the inconvenience of Katangua’s distance compared to the central location of Ikeja.

He said, “Katangua is very far; Ikeja is very central and can be linked easily, which makes it easy. So, relocating a market from Ikeja to Katangua is very far for buyers. People rarely go to that side because of distance; they prefer coming to Computer Village. A client cannot because of a phone charger or laptop charger spends all day on the road to Katangua, when Ikeja is a shorter distance and easily accessible.”

Another seller of electronics, Emeka Ezinnechie, expressed concerns about the difficulty in locating Katangua and the heavy traffic along the route.

He said, “It is going to affect us because not everyone knows where Katangua is located.  Traffic is usually crazy around that axis. Is the market relocation our problem now? They should face other issues and leave the Computer Village where it is. It is okay where it is because it is at the centre of the city.”

A female gadget seller, Awotinpe Yemisi, likened the relocation to starting from scratch.

She said, “It was like starting from scratch.  It would affect my customers because it would not be easy for those coming from the Island to come down to Katangua.”

Emmanuel Victor, who patronises Computer Village, criticised the planned relocation of the market.

He argued, “Where Computer Village is currently located is way better than relocating it to Katangua. This would even add to our hardship. The government should kindly let the market remain where it is.”

Lasg reacts

Revisiting the relocation in 2024, the Lagos State Government said it decided to relocate Computer Village from Ikeja because its current location was a residential area.

The Special Adviser to the Governor on Electronic Geographic Information System and Urban Development, Dr Olajide Babatunde, disclosed this during a recent assessment visit to the market.

The assessment was conducted by the Lagos State Building Control Agency, in collaboration with law enforcement agencies and other government agencies responsible for emergency affairs.

Babatunde said by law, Ikeja Computer Village is a residential area, adding that the plan to relocate it to Katangua was initially delayed for some reasons.

He noted that the issues were being addressed and shortly the occupants of the residential area within the computer village would be relocated and settled in Katangua.

He said, “Where the Computer Village is located is, was, and will continue by law to be a residential area, hence we must follow the law. Katangua is the area designated by the Ministry of Physical Planning and Urban Development, particularly the Office of Physical Planning.

“We chose Katangua because of the good road network, we are certain that we are not going to be having traffic problems once Katangua is ready to receive the people from Computer Village.

“The expanse of land is such that when you drive in, the person may get lost because of how huge the place is. It is not something that was not well thought of, it is within the model city plan for the area.”

He noted that the relocation of the residents is to where business would thrive.

He added, “We are moving the village into a place where their business would thrive while maintaining the status quo. Ikeja Computer Village was a residential area before, it is presently, and I think it will continue to be a residential area. We must ensure that things are done according to the law. Since the law says it is a residential area, it should remain as such.

“Katangua market will majorly accommodate the traders within Computer Village. they would have market stores and outlets, and they would have secured title to the stores allocated to them so that if they want to take loans with the property they have within the market, they can use that with any bank.

“In addition, there would be banking facilities, clinics, schools, crèche, storage facilities, and some housing, including hotels where those who come to the place outside of Lagos would be accommodated within the area.”

The special adviser noted that the relocation would be gradual, adding that consultations with market leaders and the development of the Katangua site had already commenced.

“We are planning with the people; they are also ready and we will continue to carry them along on the Katangua plan,” he added.

Again, Nigeria, Tanzania clash in African Games cricket opener

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Again, Nigeria, Tanzania clash in African Games cricket opener

Nigeria senior women’s cricket team, the Female Yellow Greens, faceoff with Tanzania for the third time in two weeks on Thursday (today), as the cricket event of the 13th African Games in Ghana gets underway at the Achimota Cricket Ovals, According Sports Extra reports.

Cricket is being played at the African Games for the first time since the continental showpiece started in 1965 and Nigeria will get the honours of playing in one of the two simultaneous opening games. The other game is between heavyweights South Africa and Namibia.

Nigeria and Tanzania met twice at the just-concluded Nigeria Cricket Federation Women’s T20i invitational tournament, which was won by the East Africans in Lagos last Sunday.

Tanzania won both games, handing the Female Yellow Greens a 49-run defeat in their first game before defeating them by another 65 runs win.

Ahead of their historic meeting in Ghana, the Female Yellow Greens are poised not to leave anything to chance despite sitting 11 places below the East Africans in the ICC rankings.

“The way we played them in Lagos was unusual to us, we dropped a couple of catches, and, you know, we went back to the drawing board to see what was wrong and how we could come back stronger. It was something we discussed a lot, knowing that we will play them again in Ghana,” captain Blessing Etim told our correspondent.

“We had a well-prepared tournament to move to the African Games, so I believe we are going to move from there. I think we have learned never to give up and to play until the last ball,” she added.

Head coach of the team, Leke Oyede, also expressed confidence in the capacity of his players.

“In Lagos, we played 40 per cent of our capacity because most of our players assembled one week to that tournament after sitting for exams in schools,” Oyede said.

“Over the years, our capacity has grown that, even with the best teams, we are now catching up with them. And we have beaten Tanzania before, so the next game won’t be an easy one for them. They have beaten us twice but we have shown that we have players who can beat them.”

Europe is creating an agricultural sinkhole for Africa

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Europe is creating an agricultural sinkhole for Africa

As farmers protest across Europe, blockading cities, smashing through police barricades, and dumping manure, European politicians are falling over themselves to promise increased trade barriers against African food and agriculture imports.

But how has locking out Zambian cotton, South African oranges, and Kenyan horticulture become such a burning issue for Africa’s biggest agricultural trading partner?

The answer lies in pest control.

When the European Union launched its Green Deal climate action plan in 2019, with the noble aim of reducing the emissions driving climate change, it threw in an extra green target of phasing out the use of pesticides.

It seemed a shrewd political move for the European Commission at the time, following countless distorted campaigns from environmentalists exploiting the membership and revenue power of claiming food and drink contamination and environmental catastrophe.

Facts weren’t necessary; the point was scary headlines. Just one example, now impacting most of Africa, was claims that one of the world’s newest and cleanest insecticides was wiping out bees, essential to the pollination of human food. It made a powerful narrative, creating images of a future world devoid of pollinated fruits.

It just happened not to be true. The pesticides don’t affect bees, and the bee population is rising rapidly everywhere, including in nations still using the targeted pest controls. But the bee campaign, and many others claiming far-fetched health and environmental risks, had by then driven public opinion and pseudoscience into a frenzy of opposition to pesticides.

The timing couldn’t have been worse, as climate change began inexorably increasing the range and volume of plant pests and diseases.

Thus, as Europe rolled out ever more bans on pesticides deemed low risk elsewhere, its agricultural production began stagnating and declining. It gave farmers rounds of compensation, rising to now half their income. But as pest losses mounted, European producers began protesting against ‘unfair’ competition from imports still allowed to use pest protection, very often from Africa.

This saw Europe turn to the mission of enforcing its extra pesticide ‘precautions’ in Africa too. It began by moving most of the Maximum Residue Levels for these risk-approved pesticides to a technical zero. This triggered a World Trade Organisation dispute that is still ongoing, driven by the US and India, but including multiple African nations, decrying the effective pesticide bans as trade barriers.

The EU then additionally introduced new lists of quarantine pests, most of which required the banned pesticides to control.

African agricultural exporters were caught in an effective pincer movement, locked out by pests they could no longer control.

In West Africa, the impact on the cocoa sector, which alone accounts for over a third of all African agricultural exports to the EU, has been so severe that cocoa prices have now soared. Coffee has also been hurt, while, in Southern Africa, the fruit and nut industries, which account for another 14 per cent of Africa’s total agricultural exports to the EU, are hanging by a thread. Last year, Europe demanded South Africa chill all oranges for export at below 2 degrees Celsius for 20 days before shipping instead of using pest protection, triggering industry warnings of a 20 per cent fall in exports and thousands of job losses.

But, in Kenya, efforts to maintain flower, fruit, and vegetable exports to the EU have triggered even greater extremes, with the local banning of pesticides targeted by Europe drawing warnings from the CEO of the Kenya Fresh Produce Consortium of a $1bn food production loss per year. More recent estimates show the country will move into a food crisis in 2025 as a result.

For Africans cannot survive if maize is left for the Fall ArmyWorm that destroys up to 70 per cent of crops, or cocoa is given up to mirids that also damage over 70 per cent, wheat to complete destruction from leaf rust, and coffee to coffee berry borer.

African governments are juggling between limiting their export collapse – to maintain import funds without which all development slows – and ensuring food production and food security at home.

It is a dire trade-off-being driven by a policy so divisive in Europe that the European Parliament, last October, voted against a new bill to further halve its own pesticide use, while EU President Ursula von der Leyen has said pesticide withdrawals have now become “a symbol of polarisation” for the EU.

In Africa, they are creating poverty, hunger, and reversed development, and now the solution to Europe’s newest political protests over them is to hit Africa harder still.

  • Jenny Luesby is a development consultant specialising in climate change

Man City belong among European heavyweights, says Guardiola

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Man City belong among European heavyweights, says Guardiola

Pep Guardiola said Manchester City have earned their place among the perennial contenders for Champions League glory after reaching the quarter-finals for a seventh consecutive season on Wednesday.

Guardiola could even afford the luxury of resting a host of star names in a 3-1 victory over FC Copenhagen at the Etihad that completed a 6-2 aggregate rout.

Goals from Manuel Akanji and Julian Alvarez killed the tie as a contest inside 10 minutes before Erling Haaland drilled in his 29th goal of the season.

Mohamed Elyounoussi briefly reduced the Danish champions’ deficit to 2-1 on the night, but Copenhagen were outclassed over two legs as the European champions remain on course for another treble.

City conquered Europe for the first time in the club’s history last season, but Guardiola acknowledged his side are now seen as favourites for the competition ahead of the likes of Real Madrid and Bayern Munich.

The English champions have not lost a Champions League game at the Etihad since 2018 and became the first side in the competition’s history to score three or more goals in nine consecutive home games.

“The important thing is being there (in the quarter-finals) seven years in a row, it’s quite impressive,” said Guardiola.

“We are well-respected from our opponents. The numbers are there – our consistency.

“I remember when I arrived, we didn’t believe, the club didn’t believe we could do it because we didn’t have the hierarchy in Europe like teams in Spain or Germany. It was a question of time, a process.

“The problem is the managers in modern football don’t have time. They gave me time, our hierarchy, so credit to them for accepting the process. Now we are a team that believe we can do it.”

Guardiola showed he had one eye on Sunday’s top-of-the-table Premier League clash at Liverpool as he made seven changes from the side that beat Manchester United at the weekend.

•⁠ ⁠Night off for key trio –
Kevin De Bruyne, Phil Foden and Bernardo Silva were among those to spend the 90 minutes on the bench to rest up ahead of the trip to Anfield.

But City were still a class apart and aided on their way into the last eight by some comical Copenhagen defending.

Akanji made a sweet connection with Alvarez’s outswinging corner but was given far too much room in the centre of the box to find the top corner.

Worse was to come for the visitors as former Liverpool goalkeeper Kamil Grabara let a simple shot from Alvarez slip through his grasp.

The 2,500-strong visiting support from Copenhagen refused to be downhearted as they kept a flat atmosphere at the Etihad going, and they had something to cheer on the half-hour mark.

Former Southampton and Celtic winger Elyounoussi drove forward with purpose and exchanged a slick one-two with Orri Oskarsson before firing into the far corner.

Haaland had been having a quiet night until he sprang into action in first-half stoppage time.

The Norwegian was picked out by Rodri before chopping onto his favoured left foot and firing in at Grabara’s near post.

That took Haaland’s total to 41 Champions League goals, matching the tally of City’s all-time leading goalscorer Sergio Aguero, but in just 37 appearances for three different clubs.

City took their foot off the gas in the second period and could have been punished but for some smart goalkeeping from Ederson to deny Magnus Mattsson.

But Guardiola’s men are rounding ominously into form for those trying to dethrone them in England and in Europe.

City have won 18 and drawn two of their last 20 games in all competitions and remain the side to beat when the draw for the Champions League quarters and semi-finals takes place on March 15.

AFP

Same old story of agony

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Same old story of agony

It is the same old story of agony for Nigerians after the telecommunications regulator clamped down on mobile telephone subscribers afresh for not linking their National Identification Numbers and Subscriber Identity Module cards. The Nigerian Communications Commission had superciliously ordered mobile telecoms companies to bar the phone lines of citizens who had not linked their NIN-SIM by February 28. As expected, the suspension has sparked widespread outrage and frustration among citizens. The NCC should stop punishing ordinary Nigerians for the infrastructural weaknesses bedevilling the telecoms sector.

Ordinarily, the policy, aimed at enhancing security and streamlining communication services, is the right call. Kidnappers, terrorists, and bandits are using phones to negotiate ransoms to the chagrin of victims and their families without being traced. The NCC has passed the bulk of using the NIN-SIM to catch criminals to the security agencies.

But like most things Nigerian, it is in the implementation that things have gone awry. Since 2020, linking the NIN-SIM has become a nightmare for subscribers. These days, Nigerians are enduring long queues at NIN registration and telco offices to link their phones. In many of these offices, it is either the internet is slow, not working or there is no electricity. In the digital age, this is ludicrous.

Consequently, those affected are running helter-skelter to link their lines. Worse, many of them had done it several times before but they were still barred. It means the technology in use is not working. The NCC puts the number of affected lines at about 42 million. The regulator threatened that any phone line not linked in the next 365 days would be forfeited completely. This is arbitrary. The financial implication could reach N242 billion, a media outlet said.

In addition, the NCC has failed to obey a court order restricting it from barring citizens yet to link their NIN to their SIM. In the lawsuit filed by Lagos-based lawyer, Olukoya Ogungbeje, against the NCC and other stakeholders, the lawyer demanded a public apology and compensation for affected citizens.

It is troubling that the NCC, an agency entrusted with safeguarding the interests of Nigerian consumers, has chosen to ignore court orders. By proceeding to bar SIMs not linked to NINs, the NCC is demonstrating a disregard for the rule of law.

The deadline set by the NCC for subscribers to link their SIMs to their NINs has only exacerbated the situation. Many Nigerians have been forced to endure queues, and harsh weather conditions, and incur additional expenses to comply with the directive. For a policy that is intended to enhance security and improve service delivery, its implementation has only caused undue hardship and inconvenience to Nigerians.

The NCC’s insistence on enforcing the NIN-SIM linkage policy despite legal challenges and public outcry is worrisome. Instead of engaging with stakeholders and addressing concerns raised by citizens, the NCC has chosen to steamroll ahead with its agenda, leaving millions of Nigerians in the lurch.

Furthermore, the potential consequences of the NIN-SIM linkage policy are far-reaching. With over 70 million bank account holders at risk of being barred from accessing their accounts, the policy threatens to plunge millions into financial uncertainty and hardship.

Therefore, the NCC must do things better. Instead of resorting to heavy-handed tactics and unilateral deadlines, it should prioritise dialogue, consultation, and collaboration with all relevant stakeholders.

Additionally, the NCC must take urgent steps to address the technical challenges and logistics constraints associated with the linkage process. The current system is riddled with defects, making it difficult for many Nigerians, particularly the elderly and less educated, to complete the process successfully. By improving the efficiency and accessibility of the NIN registration process, the NCC can alleviate the burden on citizens and ensure that everyone has equal access to communication services.

Common business mistakes you must avoid

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Common business mistakes you must avoid

Only a few small and medium enterprises survive to witness their fifth anniversary due to avoidable mistakes their owners knowingly or inadvertently make. DARE OLAWIN highlights some of these mistakes

There is no gainsaying that Nigerians are hardworking, very enterprising and eager to explore new business opportunities. They are a people ready to take business risks, even in the face of harsh economic conditions. However, it is concerning that many businesses in the country have a very short lifespan.

A report by the Small and Medium Scale Enterprises Development Agency of Nigeria indicated that 80 per cent of small businesses in the country fold up before their fifth anniversary due to harsh economic conditions. Besides the tough operating environment, errors by the proprietors are also a major reason businesses die prematurely. In most cases this has nothing to do with whether one goes to school or not; after all, there are many successful traders among the unlettered ones in the society.

To prevent your business from entering into the list of businesses that pack up before their fifth anniversary, you must avoid these mistakes:

Improper planning

Management is nothing but planning. To manage is to plan and this encompasses budgeting, directing, coordinating, organising and evaluating. So, anyone who fails in this aspect will have himself to blame. There is a popular saying that he who fails to plan plans to fail. Many businesses fail. Many business owners fail to have holistic plans before they hit the market.

Carrying out a preliminary feasibility study is crucial to determine the viability and merits of a proposed project or undertaking. Starting a business without a clear-cut plan can lead to aimless direction and neglect of crucial business components such as budgeting and inventory management.

 Lack of skills

A would-be business owner is not expected to wake up one day and jump at a business idea. He must have enough understanding of the business, learning the pros and cons of the business to avoid running into problems. Anyone setting up a new business must learn the nitty-gritty of it before venturing into it. There is nothing wrong with picking interest in an area you do not know much about, but in doing so, experts must be consulted.  They must be carried along right from the gestation period.

As an entrepreneur, learn and keep learning. Read books to acquire the right skills. Know the strengths, weaknesses, threats and opportunities of what you are dabbling into. This is what experts call SWOT analysis.

Mixing business and pleasure

Most entrepreneurs fail to draw a line between business and pleasure. Because it is their own business and they are not under the directive of any boss, they choose to do things at their convenience. But businesses have their culture, which must be observed by anyone who desires success.  As an entrepreneur, you have to set boundaries; and clearly define when you are “on the clock” for business and when you are off duty for personal activities. Establish specific work hours and stick to them as much as possible. Yes, no one will sanction you for late coming, but remember your investment is at stake. Your customers have choices. Designate separate physical spaces for work and leisure activities. Have a dedicated home office or workspace where you conduct business, and avoid mixing it with areas meant for relaxation or family time.

Family and friends factor

It is important to separate businesses from friends and relatives. In Nigeria, relatives tend to seek undue favour from one of them in business. People want to ‘patronise’ a family member or friend for free goods or services, for discounts or to buy on credit. These acts are capable of killing the business by affecting cash flow and earnings. There is no sentiment in business, do not allow relatives to bring down what you have been labouring for. Let them know the difference between a profit-making establishment and a charity organisation.

Too much credit sales

The culture of selling goods to people on credit is rampant among small and medium startups, especially those in the informal sector of the economy. There is a general belief among them that if you do not sell to people on credit, you may not make enough sales. However, several businesses have collapsed due to unpaid debts, particularly by people who are not traceable. Selling goods or rendering services on credit is not bad, but it must be done with utmost caution. As an entrepreneur, it’s generally advisable to avoid selling goods on credit. Selling goods on credit ties up your cash flow, as you have to wait for customers to pay their invoices before receiving payment. This can strain your finances, especially if you rely on that cash to cover expenses like restocking or operational costs. Also, extending credit to customers introduces the risk of non-payment or late payment. This risk is particularly high for startups, which may lack the resources or infrastructure to effectively assess customers’ creditworthiness or pursue collections if payments are overdue.

Poor accounting

Everybody needs minimum accounting skills in their day-to-day activities. Even if you cannot hire an accountant, you must be able to calculate your income and expenditure, to determine whether or not you are making a profit.

In other words, proper accounting provides SMEs with a clear picture of their financial health. It enables them to track income, expenses, assets, and liabilities, allowing for better financial decision-making and resource allocation. Overall, proper accounting is essential for SMEs to maintain financial stability, comply with regulations, access funding, plan for the future, control costs, manage risks, and support business growth. If you can, hire a reliable accountant. If you cannot, get trusted relatives to assist.

Dipping hands into capital

One of the reasons businesses fail is a lack of self-control when it comes to fund management. Many entrepreneurs do not know that taking care of other expenses should not be from their capital. Your business account must be separated from your account. It is a sacrilege to spend your business fund on your personal needs. If you do that, you are plotting the failure of the business.

Employing wrong workers

Those working with you are as important as your business. Their actions may make or mar your investment. Some employees absconded with money belonging to their principals. Please apply serious caution when it is time to recruit managers, secretaries, salespersons, accountants and others.

Other common errors that could cost SMEs their investments include, poor customer relations, wrong decisions, too much borrowing, especially from loan sharks, all forms of irresponsible acts, among others.

A financial expert and entrepreneur, Adewale Adedeji, expressed concern over how some individuals would still allow their investments to break down despite the challenges encountered before setting up the business.

 Adedeji, a former banker said most new businesses have the problem of finance at the earliest formation and usually don’t survive it. According to him many business ideas and investments are under what he called heavy dusts.

 “Our financial institutions are not readily available to support these categories of businesses because they see them as startups. They don’t have the patience to wait through and rarely commit moratorium for these new businesses,” he said.

Consequently, he urged entrepreneurs to pay rapt attention to their businesses and avoid common errors that could erode their investments.

Quantity surveyors urge FG to regulate construction material prices

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Quantity surveyors urge FG to regulate construction material prices

The National Institute of Quantity Surveyors has called on the Federal Government to promptly intervene and stabilise the prices of products in the construction sector, to curtail the negative effects of hyperinflation in the industry.

The President of the NIQS, Kene Nweze, made the call during a press conference in Abuja, where he warned that the trend of increased prices of construction materials could disrupt economic projections, and push the economy into uncharted territory.

He lamented skyrocketing prices of building products while calling for the government to consider opening the country’s borders, to allow for the import of cement, which would crash prices in the local market.

He also noted that the industry served as a tool for measuring development as a country.

“The construction industry was reported to have contributed up to 11.79 per cent to the nominal GDP in the first quarter of 2023. This shows how important the construction industry is to the Nigerian economy and the need for all stakeholders to protect this important industry.

 “Inflation is a part of economic cycles, but what we are currently facing in Nigeria is hyperinflation, an uncontrollable surge in general price levels. The repercussions are dire, disrupting economic projections and compelling government planners into uncharted territory,” he said.

Nweze added that the hyperinflation was crippling the construction industry, resulting in the halting of projects and that it could impede the development of critical infrastructure.

“The price of cement, using a 50kg bag as an indicator, between January 2024 and February 2024, a period of about six weeks, has increased from N4,500 to between N12,000 and N13,000. This is an increase of between 100 per cent and 150 per cent. Reinforcement steel rods, another major material for construction, moved from around N590,000-N650,000 per tonne as of January 2024 to N1.2m-N1.4m as of February 2024, an increase of over 100 per cent in a short run of less than six weeks.

 “This ugly trend is making it more difficult for prospective clients to afford construction projects and has forced many projects to stall, pushing contractors into financial distress. The repercussions extend beyond stalled projects; it impedes the development of crucial infrastructure such as roads, hospitals, and educational facilities.

 “Private sector investors are also reluctant, creating an adverse cycle that hampers economic growth and job losses in the construction industry,” the NIQS president stated.

The institute, as part of its recommendations, urged the government to engage local manufacturers to understand their challenges, stabilise the exchange rate by clamping down on “saboteur” Bureau de Change operators, and monitor and enforce Executive Order 5, which would promote local contents in the planning and execution of projects.

“Some of the challenges highlighted by the local manufacturers include exchange rate volatility, which has seen our currency depreciate by about 300 per cent in a few months. Combating oligopolies and cartels in the construction and manufacturing industries must be encouraged. Perfect competition should be the aim.

 “The government must employ a mix of monetary policies and exchange rate policies to stabilise the exchange rate. Implementing a friendly tariff regime, involvement of quantity surveyors to manage price fluctuation from the first principle,” Nweze asserted.

VIDEO: Wigwe’s PA recounts how luggage stopped him from joining ill-fated chopper

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VIDEO: Wigwe’s PA recounts how luggage stopped him from joining ill-fated chopper

Sola Faleye, Personal Assistant to the late Group Chief Executive Officer of Access Bank Plc, Herbert Wigwe, has recounted how he narrowly escaped the helicopter crash that claimed the lives of his boss, the CEO’s wife, son, and business associate, Abimbola Ogunbajo.

Faleye made this known at the Night of Tribute held in Lagos

He said he initially planned to travel by helicopter but reconsidered his stand, opting to travel to Vegas by road with the luggage. At the same time, Wigwe, his wife, son, and Ogunbajo took the chopper to the same destination.

Faleye said, “It was a sweet journey. 11 hours we flew from London. I remember in the middle of the air, I walked up to him. I said, ‘Sir, how comfortable are you at night flying choppers? I’ve never done it before. The app allocation system for flying choppers, I have never done it before,’ and he said this is America, they have a navigation system for flying choppers at night and I went back to my seat. And we landed. Everybody was filled with joy that we were finally almost there.

“We sat, waiting to be cleared by immigration, So coming out, we had two vans waiting, One was taking us to go aboard the chopper. The other one took our luggage because they could not go on the chopper. Throughout my years of working with him, I’ve always told myself that flying that way is not a luxury for me. I am on duty. And as they were loading the luggage. And this thought came to mind. That’s OK, you fly chopper one. One hour you are there.

“The next three and half hours, the luggage will not come. Will I go to bed? No. I still have to sit down and wait for those luggage to come. I’m like, so why not just go with the luggage then, get there and deliver it to him and others in the room. Like I said, I always reason in the line of duty.
“And I walked up to him. I said, ‘Sir, I think it’s safer and secure for me to just ride and bring the luggage to you.’ He said it was a brilliant idea. And I said, safe flight.”

NGX, PenCom, train operators

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NGX, PenCom, train operators

The Nigerian Exchange in partnership with the National Pension Commission and the Pension Fund Operators Association of Nigeria has held a webinar to deepen knowledge of the NGX Pension Broad Index.

The webinar, which was held on Wednesday, featured a panel discussion by stakeholders in the pension industry, who highlighted the importance of the benchmark for the industry.

In his opening speech at the webinar, the acting Chief Executive Officer of the NGX, Jude Chiemeka, who was represented by the Acting Divisional Head of Capital Markets, NGX, Tony Ibeziako, said that the exchange had been at the forefront of providing indexes for the capital market for decades.

He said, “We believe that this webinar will be of immense value to the stakeholders. The NGX has been at the forefront of providing benchmarks for the Nigerian capital market for over 40 years. Over the years, the exchange has been proactive in providing more indexes. Now, we have over 20 benchmarks with five of them being sectoral.

“The year-to-date gains of the NGX pension broad index are 32 per cent.  The NGX thought to socialise the market with this index hence this all-important webinar.”

In his presentation, the Chairman of the NGX Index Governance Committee, Abimbola Babalola, said that the benchmark offered pension fund administrators a reference point to measure their performance as well as broaden their choice of securities.

 “With this broad index, PFAs now have a benchmark to compare their performance against. It is also like a guide for investors. Instead of cheery picking, they can look at the constituents of the NGX broad benchmark and decide on which stock to pick,” Babalola, who is also the head of Market Surveillance, NGX Regulation.

According to Babalola, the broad index brings in more than 40 securities and has none of the limiting requirements of the NGX Pension Index.

“The index tells you all the securities that have met PenCom requirements. Fundamentally, we screen these companies first. You can use it to predict the direction of the economy. This index can guide you in measuring the import of government policies. The index is a forward-looking one,” he added.

The Head of the Investment Supervision Department, PenCom, Abdulqadir Dahiru, said, “We started on this journey with the NGX and it culminated in the NGX Broad Pension Index which provides diversification. From 40 stocks in the NGX Pension Index, we are now talking about 84 securities. We believe it is more representative and gives PFAs choices and helps them measure their performance.”

He stressed the need to focus on capacity building.

“I think some of our PFAs have weaknesses around their investing team, so I will encourage the market to improve capacity, and understanding so that they can go into the market with a bit of certainty.  There are some stocks which we have brought in which PFAs were not even looking at,” he enunciated.

For the Chief Investment Officer of Shell CPFA, Ehis Uzenebor, the decision to intentionally push for benchmarking is a testament to the growth that the market has achieved.

“With appropriate benchmarking, fund managers can evaluate themselves. The board and trustees can also evaluate how fund managers can. It provides an objective basis for comparison across the industry.

 “When it comes to the role of risk management, if you appropriately benchmark, then to some extent, risk management appears elevated. It is also useful for the regulator in the sense that the regulator can ascertain and evaluate the appropriate relevance of guidelines from time to time,” he declared.

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