SPEAKING recently at a public event, the Governor of Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi, said that most of the states in the country were unviable.Sanusi's declaration lends credence to the assertion in the Senate that most states of the Federation are financially unhealthy and on the brink of bankruptcy. The CBN Governor lamented that 70 percent of the revenue of the Federal Government, is spent paying salaries and overheads leaving 30 percent for the rest of Nigerians. Sanusi's view resonates with a motion in the Senate which observed that the bulk of the revenue of states was spent to maintain the civil service whose workforce constitutes less than 4 percent of the total population of any state.These patterns of expenditure by the government have led to a dysfunctional and stunted growth of the economy. The states are now on the verge of bankruptcy in spite of sharing from the enormous revenue accruing to Nigeria from oil as the world's sixth highest producer and exporter of the product. Unemployment rate in the country as at 2010, according to the National Bureau of Statistics, is 21.1 percent; 70 percent of the population live below poverty level; illiteracy rate is 56 percent; and the country's infrastructural deficit is in excess of N30 trillion.These figures reflect a gloomy picture of a disheveled and battered economy in urgent need of rescue measures. It is common knowledge that the workforce of most of the states is bloated; too many political appointees, while most of the appointments are duplicated. The states create too many ministries which do not add value to governance and are not even desirable for the amount of service delivered to the people.Though we acknowledge the fact that the economies of many states are in bad shape and on the brink of collapse but we do not subscribe to the suggestion, as being canvassed in the Senate, that the unviable states should be merged with the viable ones. We believe that each state can survive, and even blossom, if prudence, accountability and transparency are made to bear on the management of the lean finances.Budgeting is critical to robust governance; it represents periodic, carefully thought-out plans and programmes. This must be taken seriously and not treated as mere ritual. Funding the budgets and its implementation are the major challenges of many states. The states must not limit themselves to monthly allocation from the Federation Account from which they get only 26 percent. At no time will this prove adequate.Therefore, governors must devise ingenious strategies to raise internally generated revenue to an appreciable level. Sustained efforts must be made to monitor budgets, vigorously block leakages in government expenditures; and be transparent in the award of contracts. The Federal Government is pivotal to the development of the major infrastructure especially power, roads, rail and such others that serve as catalyst for the growth of the real sector; the states must play their complementary roles in development of infrastructure and in other strategies to boost agriculture and other industries for which they have comparative advantage. It is instructive to recall that the regional governments of the First Republic built the economy of their regions, not from oil wealth but from agriculture.The governors can also make savings. The costs in terms of purchase and maintenance of long convoys; costs of sponsoring religious pilgrimages, gifts linked to religious celebrations, among others, which though appear seemingly innocuous, yet, add up to substantial amounts. Vital institutions of democracy must be strengthened to serve as watchdogs and checks on the spending excesses of the government. It is the only way to ensure that the states and other tiers of government remain economically viable and serve the common good which is their very essence.
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