Budget 2012 (4) – The Rewards Of Insurgency By Nasir Ahmad El- Rufai February 12, 2012

Am one of this people who are of the opinion that Nasir El Rufai might not be a saint but he is one of the most brilliant minds with ability to deliver results that has come out of Nigeria. His record of service has shown that he is not in the class of intellectuals who cld not deliver when given the opportunity. As of Today Nasir is the only NIGERIAN that I can work for to become the president of Nigeria knowing fully well he will deliver . This is another masterpiece on his Budget 2012 analysis. Follow him on twitter @elrufai together Insha Allah we ll make him the president. Enjoy

By Nasir Ahmad El-Rufai

We continue our detailed review of
the 2012 Budget proposals today
looking closely at the amounts
earmarked for three budget heads
that are connected to the security
and intelligence community, and
ostensibly driven by the decisions in
the NSA’s office. These are the
allocations to the Amnesty
Programme, the Presidential Air
Fleet and for Maritime Security. Our
objective is first to ask whether we
have not become a society that
rewards taking arms against the
State, secondly to appreciate the
huge amounts allocated and then
ask the standard quantity surveying
question – is Nigeria getting value
for the money being spent?
These questions need asking
particularly in light of some
developments in the last week or
so. The first was a text message
sent to me from a staff of the
Budget Office observing that for the
eight years between 1999 and
2007, the cumulative amounts
allocated to, and controlled by the
NSA’s office were about N29bn,
with a brand new NSA office was
built out of that and more – less
than what the office got allocated in
just one year in 2012! Either this
allocation is for something else
other than security, or someone is
taking an early, generous pension,
the officer opined. More questions
than answers!
The second is the decision of the
Jonathan administration to hand
over security, regulatory and
revenue collection functions of the
Federal Government in its territorial
waters to a private company
allegedly owned or control by the
one-time militant known as
Tompolo, in what is clearly a dodgy,
crony-driven afterthought.
This is even when N4bn has been
proposed in the 2012 Budget for
“Maritime Security”, and in spite of
loud objections by sections of media
and civil society. Thirdly, is what
appears to be a half-hearted
willingness of the administration to
negotiate with the insurgents of
Boko Haram days after the Chief of
Army Staff has sworn that his
military solution will wipe out the
sect soon. What is the implication of
this and what does the immediate
future portend?
In 2012, the Jonathan
administration proposed a budget
of some N124.3 billion for the
intelligence community. Separately,
N4bn has been budgeted for
maritime security and N11.2bn for
the pensions of the SSS and NIA
retirees as consolidated revenue
fund charges, and N74.2bn for the
Amnesty Programme, now tucked
away under the SGF’s office. Thus
effectively, we are looking at about
N210bn for civil, non-uniformed
security spending. We will look at
the budgets of the Armed Forces,
the Police, and Para-Military services
in subsequent articles.
A closer look at the President’s
Amnesty Programme (PAP). It was
the initiative of President Umaru
Musa Yar’Adua as a response to
intensified levels of militancy in the
Niger Delta, the disruption of crude
oil production and exports, and
heightened insecurity of lives and
property in the region. According to
Yar’Adua insiders, the then vice-
president was tasked to come up
with a plan, which took too long to
articulate, and which Yar’Adua
found impractical and unworkable.
He therefore turned to some
individuals, businessmen and
‘serious’ governors in the region to
help develop a workable strategy.
As soon as that was done, Yar’Adua
moved with uncommon speed to roll
out the programme and get
stakeholders’ buy-in. He made
several concessions which included
releasing the militants then in
detention or on trial in courts in
Nigeria. Is that a workable template
for engaging Boko Haram?
For Yar’Adua, the failures of
successive administrations to
address the fundamental
developmental and environmental
issues in the region is the problem,
and he genuinely wanted to draw a
fresh basis for engagement. Similar
questions need to be raised and
honest determinations made
regarding the Boko Haram
insurgency, identifying the root
causes, the ‘dramatis personae’
and how we got to where we are,
before developing a workable
approach.
With regards the Niger Delta, the
issues in my humble opinion are
more complex than that identified
by Yar’Adua, and that is why I felt
then that the solution was flawed
and unsustainable. The strategy of
handing out wads of cash to people
that (1) have not earned the money
through meaningful work and (2)
with a pre-existing sense of
entitlement may ostensibly amount
to rewarding insurgency – what
economists call “moral hazard”.
Whether the ex-militants are on
foreign vacations, attending skill-
building programmes (or even
military training, as being
rumoured), the challenge is to find
them jobs that pay better than their
previous lives – during militancy and
after. That means jobs that pay at
least N65,000 tax-free monthly
stipend, which with other costs
amounted to N3 million per annum –
about what we spent per militant in
2011. Boko Haram of course may
require a different approach.
Last year, the Programme was
allocated N99bn, rapidly up from
N2.9bn in 2009 and N28bn in 2010.
In all, over N200bn would have
been spent on the programme by
the end of this year, perhaps
another N100bn next year which is
said to be the programme’s
terminating date. Then what next?
Where do we generate the tens of
thousands of oil-related jobs for
them? What about other youths
from the region that have not been
captured in the original programme,
but suffer from the same
hopelessness that pushed their
elder siblings to militancy? What
signal does this send to youths of
other regions? These are key public
policy issues that require very deep
reflection.
The truth is that unless the quality
of governance in the region
improves and the resources
allocated used by the State
Governments, Niger Delta
Development Commission (NDDC)
and Ministry of Niger Delta Affairs
judiciously used for physical
infrastructure and human capital
development, nothing will ever
change for the better. Last year,
quite apart from the huge funds
from federation account that went
to the State Governments in the
region, the NDDC received N56bn
from the federal government and
the Ministry of Niger Delta Affairs
collected and spent about N39bn.
Like the rest of Nigeria, the binding
constraints are quality of
governance, accountability in the
use of resources and attitude of the
leadership and followership – and
when these are resolved locally as
Governor Rotimi Amaechi is said to
be trying to do, the task
environment improves for
everyone., and insurgency and
violence lose their attraction.
Throwing money at any problem,
which ends up getting diverted to a
few people’s pockets is simply
postponing the evil day, and
compounding the moral hazard
problem. In 2012, the NDDC gets
N55bn and the Niger Delta Ministry
another N57bn. These funds should
be spent addressing fundamental
problems, not on spurious contracts
with a “share-the-money” attitude. I
will return to the Niger Delta in a
future article, by God’s Grace.
The Presidential Air Fleet (PAF)’s
budget is under the office of the
NSA. This year, PAF envisages
spending N20.4 million for staff
costs and N665 million for overhead
without any breakdowns. The
capital budget is some N2.9bn thus
bringing the Fleet’s total allocation
to some N3.5bn. The PAF has since
its establishment gone through
several mutations. It has had civilian
pilots from the defunct Nigeria
Airways side by side with military
personnel (due to fear of in-flight
coups like the 1985 aborted plot!),
but is today largely manned by
Nigeria Air Force personnel.
The PAF’s capital budget has been
earmarked for motor vehicles
(N113.5 million), office equipment
(N11.2 million), purchase of sports
and games equipment (N15 million)
, Installation of cameras and related
equipment (N12 million), and
construction of PAF staff quarters
(N241.5 million). Other items of
expenditure include construction of
new hangar (N550 million),
computerization of aircraft spare
parts inventory (N14 million) and
the balance of N1.9bn for purchase
of Hawker 4000XP aircraft, which
was first budgeted for in 2007 and
delivered in 2010. What is
interesting is that even after
delivery in 2010, the sum of about
N17bn (US $110 million) was
budgeted for it in 2011, and now
another $12 million! The N17bn is
the amount I mistakenly assumed
was in the 2012 budget. This is a
very expensive plane indeed that
we have been budgeting and
paying for across five fiscal years.
There is need to know how much
this plane costs bearing in mind the
market prices of similar or better,
fully-loaded executive jets –
information now freely available on
the web.
Some have asked the question
whether Nigeria’s president needs
to maintain a fleet of aircraft. After
all, they say, the Queen of England
and the British Prime Minister flies
everywhere in the world on British
Airways, UK’s national carrier. Such
views forget to mention that the
USA has a fleet of aircraft dedicated
for the president. Even the secretary
of state travels on official
assignment from that fleet. We
should look at our environment and
choose what will work for us, but
without waste and impunity. Should
our president be made to suffer the
usual several hour delays when
travelling even within Nigeria? I do
not think so. Last time I checked, we
had 5 aircraft in the fleet, some of
them nearly 20 years old. Do we
need five planes? Is the usage of
the planes for shopping sprees by
presidential friends and relations
legal and justifiable? Should private
visitors to the president have access
to the fleet? What is the framework
for accountability and use of these
aircraft? These are the questions
that need to be answered to make
the system work better.
The last item is the N4bn earmarked
for Maritime Security as a charge on
the consolidated revenue fund (CRF)
without any breakdown or details.
Based on budgets prepared some
years back, it is my natural
assumption that this item is the
continuation of investments in boats
and related equipment for the use
of the Joint Task Force and the
Nigerian Navy for use in policing our
territorial waters and the creeks of
the Niger Delta. These are
constitutional roles for our military
that I do not think the president can
privatize or outsource to any private
company. And it is therefore
surprising that no one reminded the
president that regulatory, security
and revenue collection matters are
not in any of the Schedules to the
Privatization & Commercialization
Act 1999. Indeed, the use of private
companies to collect revenue has
been specifically outlawed in Nigeria
last time I checked. But I forget that
like Napoleon in Animal Farm, laws,
rules and regulations do not apply
to some people that are more equal
than the rest of us. Welcome to our
new Jonathanian Republic!