The National Economic Council (NEC) has constituted an Ad-hoc Committee to engage with the leadership of labour unions to resolve issues surrounding the petrol subsidy removal and introduction of palliatives.
The decision was reached at the 135th meeting of NEC chaired by the Vice President, Sen. Kashim Shettima in Abuja on Thursday.
The committee comprises the Nigerian Governors Forum Chairman, AbdulRahman AbdulRazaq; Governor of Anambra State, Chukwuma Soludo; Chairman of Progressives Governors Forum, Hope Uzodinma of Imo State; PDP Governors Forum Chairman, Bala Mohammed of Bauchi State, and Abia State Governor, Alex Otti.
Vice President said the committee will liaise with the leadership of labour unions in the country to find a way forward on the emerging issues in the interest of the nation.
Council also received progress reports on the ongoing nationwide distribution of rice, grains, fertilizer, other items to States and N5 billion financial support, provided by the Federal Government and commended the Central Bank of Nigeria (CBN) and the National Emergency Management Agency (NEMA) for their interventions.
Council then noted various interventions by State governments and urged them to upscale the distribution of palliatives towards alleviating the suffering of citizens especially the vulnerable groups.
NEC also mourned the death of some military personnel in Niger State and observed a minute silence in honour of deceased, while commiserating with their families.
Below are other highlights of the meeting:
Excess Crude Account from 19th July to 14th August, 2023, $473,754.57
Stabilisation Account from 18th July to 14th August, N30,346,557,405.12
Natural Resources Account from 18th July to 14th August 2023, N115,175,616,159.65
Presentation of preliminary Assessment
The Governor at the 128th NEC Meeting held on 20th October, 2022, the Chairman of the Nigeria Governor’s Forum and Executive Governor of Sokoto State, Rt. Hon. Aminu Waziri Tambuwal, drew attention of Council to the devastating effect of the 2022 flooding which affected about 31 States of the Federation that had resulted in the loss of over 600 lives, displacement of millions of people, destruction of hundreds of thousands of houses and submersion of thousands of hectares of farmlands and appealed for urgent intervention from the Federal Government to address the impact of the menace on the people and infrastructure.
Consequently, Council resolved to set up a 5-man Ad-hoc Committee on flooding comprising of Governors of Jigawa, Kogi, Anambra, Bayelsa, Lagos and Yobe State. The following were also coopted into the Committee:
Honourable Minister of Finance, Budget and National Planning
Honourable Minister of Water Resources
Honourable Minister of Agriculture and Rural Development
Honourable Minister of Humanitarian Affairs and Disaster Management
Governor of Central Bank of Nigeria
Director General, National Emergency Management Agency (NEMA)
The Terms of Reference of the Committee was to “Review the current flooding situation in the country and design a template for compensation of victims”.
The Committee had its inaugural meeting on Thursday 10th November 2022 at the Nigeria Governors’ Forum (NGF) Secretariat. Highlight of the Meeting were as follows:
The Committee acknowledged the urgency of the assignment and hence the need to expedite action in order to table a draft report at the next NEC Meeting
A sub-committee was constituted to propose modalities to address the imminent food crisis due to the flooding and possible source of funding for palliatives to victims. The Sub-committee was to be Chaired by the Executive Governor of Kebbi State and the following as Members: Ministries of Agriculture, Humanitarian, Finance, NEMA and CBN.
NEC Secretariat to develop and forward a Template with accompanying letter to all the affected States to collect data on Preliminary Assessment of the impact of the flood in the affected Communities, harmonize the data and produce a report of their findings to the Committee.
LIMITATIONS
The exercise would have been more successful and effective if all the affected States had responded as and when due and according to provisions made in the template. Some of the limitations include the following:
Delay or Non-submission of filled template by some States. Only 16 out of the total number of affected States forwarded their submissions to NEC Secretariat to date as expected. About 15 others were yet to do so. The submission from defaulting States are awaited to update the database.
Some of the States that submitted did not fully comply with requisitions of the template thereby making some of their submissions difficult to process by the automated system. There is the need for compliance with laid down processes to allow for higher degree of uniformity especially considering the huge volume of data involved.
Only a few States reached out to the Council Secretariat’s Technical Team for possible guidance and assistance in the exercise. States are encouraged to take advantage of the Secretariat’s personnel to address important concerns where necessary.
Only a few States indicated financial implication for the damages caused thereby making it difficult to propose a required amount of intervention.
Some submissions were not done according to the template which makes it difficult to ascertain the financial implications of such states.
RECOMMENDATIONS
The plight of victims of the unfortunate flood disaster across affected States of the Federation could be alleviated if the much needed intervention from the Federal Government materialized without further delay.
There is therefore the need to expedite release of funds to affected States as recommended by designated Committees constituted by the Federal Government to that effect. This would go a long way in addressing the needs of the victims as well as offset debt incurred by some States to assist their citizens.
COUNCIL RESOLUTIONS
NEC Secretariat and officials of the Office of the Vice President to visit the affected states for on-the-spot assessment of the situation on ground. The exercise will authenticate the date submitted by the state to determine needed intervention.
That Federal Government’s immediate intervention to be expeditiously carried out by NEMA, Ecological Fund Office and other relevant agencies. States to assure maximum cooperation.
NEC resolves that all hands should be on deck to assure appropriate submission and data presentation. The quality of data collected should be enhanced to meet international standard. That the challenges of flooding deserves concerted and collective effort.
There is need to strengthen NEMA as a structure and sustainable adaptation measures for the citizens. In mobilizing resources to stem the tide of flooding, there is a need to look beyond NEMA.
NEC Secretariat to come up with recommendations on the roadmap towards addressing the flood situation.
PRESENTATION ON EXPLORING A NEC AGENDA FOR MACROECONOMICS STABILITY & SHARED PROSPERITY BY DG NESG
The Presentation was to inform the council on achieving low Inflation and stimulation Growth and Macroeconomic Objectives.
MACROECONOMIC STABILITY OBJECTIVES:
· High and stable economy
· Low Inflation Growth Price level
· unemployment Account
· Favourable Current low balance and stable exchange rate account balance
CURRENT MACROECONOMIC LANDSCAPE
· Investment inflows have dwindled since 2019, likewise the country’s investment/GDP ratio; Crude Oil exports and refined petroleum products imports dominate Nigeria’s trade structure.
Nigeria’s Naira position against major trading currencies deteriorated
• Weak FX supply and heightened demand for imports remains core drivers of exchange rate instability; market volatility persists despite recent FX alignment, driven by pressure on FX demand that widens the gap between official and parallel market rates due to inadequate supply and speculative tendencies; external reserves remain under pressure as external reserves fell by 8.3 percent from 37.1 billion in January 2023 to 33.9 billion in July 2023.
KEY CONSIDERATION FOR IMPROVING THE OUTCOMES OF FUEL SUBSIDY REMOVAL
• Inflationary impact: Fuel subsidy removal will increase inflation. So, there is a need for robust social programmes.
• Efficiency in government spending: There has been a lack of clarity on how the government spends subsidy savings. This issue must be addressed.
• Investment in the downstream and midstream segments of the industry: Achieving this will reduce huge dependence on petrol imports and strike out the need to pay subsidies on fuel.
RECOMMENDATIONS:
The NEC must insist on pushing a national legislative reform agenda for national competitiveness. It is essential that Nigeria resolves the legislative binding constraints to our national competitiveness, the NESG through nassber, our partnership with national assembly and nigerian bar association has identified over 115 legislations that hinder growth, in the last few years, 10 legislations have been passed (including the cama 2020 and the pia 2021.
COUNCIL RESOLUTIONS:
· Council commended NESG for its presentation especially on pragmatic roadmaps for tackling current economic challenges.
· It was noted that the recommendations contained in the NESG’s roadmap needs to be reviewed to align with existing economic agenda at the national and sub-national levels for pragmatic purposes.
