The chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele has expressed his concerns about the lackadaisical attitude towards the vast assets owned by the federal government throughout the country. These assets, estimated to be worth ₦100 trillion, have immense potential for generating more revenue. Speaking during a recent end-of-year cocktail party hosted by the Harvard Business School Association of Nigeria (HBSAN), Oyedele stressed that with efficient management, the government could potentially earn an annual income of ₦10 trillion from these assets, which could then be utilized to support crucial developmental programs.
Oyedele said the government has demonstrated a complete lack of concern towards these valuable resources resulting in their mismanagement. When you consider the immense potential of efficiently handling these hundred trillion assets, even with a modest annual return of 10 percent, that would generate a staggering ₦10-trillion in revenue, he said. Given the improper management, the expert suggested selling off these assets as a more viable solution. He expressed that a portion of it would provide ample FX liquidity to enhance productivity in the private sector. This approach would also promote economic activities and also generate tax revenue.
Generating revenue lies in fostering a thriving economy.
According to Oyedele, despite the lack of action taken on the Ministry of Finance Incorporated (MOFI) Act, there are plans to revise the 1959 law in order to establish that MOFI should be responsible for managing assets, including the government’s stake in enterprises. Emphasizing the prominence of economic growth facilitation within the 75-member presidential committee, he stressed that the sole enduring method of generating revenue lies in fostering a thriving economy. Continuing on he pointed out that Nigeria needs to address the barriers hindering economic competitiveness and growth, especially concerning small enterprises.
Moreover, he said the committee has handed over its reports to the President including significant suggestions for resolving crucial economic matters, encompassing exchange rate control, the consequences of fuel subsidy elimination, inflation moderation, and the promotion of economic expansion. Oyedele also mentioned that Nigerian inflation rate is approximately four times higher than the worldwide average, and the country’s Gross Domestic Product (GDP) is insufficient and declining in terms of dollars due to the depreciation of the naira.
A framework to improve spending standards has been implemented.
It is a cause for concern, as Oyedele points out, that the increasing public debt is accompanied by a substantial disparity between the borrowed amount and capital spending. This disparity requires clarification, particularly considering that the country is borrowing to cover recurring expenses and debt obligations. Oyedele revealed that the committee put forth proposals to the federal government in regards to tackling overlapping duties in public service, guaranteeing responsible management of public finances, and maximizing the value derived from government resources and assets. Additionally, he mentioned that the committee has advised fostering policies that encourage clear direction and collaboration among various ministries, departments, and agencies (MDA).
He added that the committee has implemented a budgetary framework aimed at improving the importance and standard of spending, alongside fiscal actions that support foreign currency management to achieve harmonization and steadiness. In a recent statement made by the Minister of Finance and Coordinating Minister for the Economy, Mr. Wale Edun, the government intends to generate an approximate yearly income of $13 billion from national assets. The minister elaborated that the strategy encompassed enumerating all the national assets, introducing governance, as well as monetizing and optimizing the assets
Govt plan aimed at bolstering the National Assets under MOFI.
Edun stated that the establishment of a National Assets Register by the MoFI is expected to help in accomplishing the plan, which will generate a substantial revenue equivalent to approximately 3.0% of the country’s Gross Domestic Product (GDP), amounting to a remarkable $13.3 billion. According to Edun, the aforementioned plans are aimed at bolstering the National Assets Under Management (AuM) of the MoFI and are projected to push the value up to ₦100 trillion, a significant jump from its current standing at ₦18 trillion.