- Category: GENERAL
- Published on Thursday, 09 August 2012 22:08
- Written by Eze Chukwuemeka Eze
The main treatise of this attempt for avoidance of doubt is to examine and x-ray how Gov Chibuike Rotimi Amaechi of Rivers State has diligently and prudently managed the resources of Rivers State or otherwise. This becomes imperative considering the Punch Newspaper publication in its edition of 4th August, 2012 where the
frightening financial status detailing the external high indebtedness of most of the States in Nigeria and the heart-warming stand of Rivers State coupled with the pressure from some cynics that Amaechi is not doing much in lieu with the resources at his disposal.
According to States and Federal Government’s external debt stock obtained by SATURDAY PUNCH of 4th August, 2012 from the Debt Management Office, Lagos, Kaduna, Cross River, Ogun and Oyo occupied the top position on the list of external debts incurred by State governments as of June 30, 2012 Borno, Delta, Plateau, Taraba and Anambra states had the lowest external debts.
Lagos topped the list of external debtors with $517,677,672 as of June 30, 2012. Next to Lagos is Kaduna with $197,155.525, Cross River has $109,351,503 external debt. Ogun State is the fourth most indebted state with $96,285.547 as of June 30, 2012. Oyo’s external debt (the fifth) was $78,878,401 as of June 30, 2012,
SATURDAY PUNCH investigations showed that the present administrations in Ogun and Oyo inherited the foreign debts from their predecessors. States, whose external debts are low, include Borno ($12,726,028); Delta ($15,785,110); Plateau ($20,190,627); Taraba ($20,681,527) and Anambra ($25,370,842). However, while other four states depend on federal allocations, Lagos generates huge internal revenue, which was about N23bn monthly in the first quarter of the year.
At the zonal level, South-West leads the external debtors with $840,913,596, followed by the North-West, $473,305,365; South-South, $289,952,619; North-Central, $189,192,241 and North-East, $186,303, 921.
External debts of other states, apart from the 10 mentioned above are: Abia, $32,675,171; Adamawa, $29,183,118; Akwa Ibom, $61,198,851; Bauchi, $63,029,387; Bayelsa, $27,897,951; Benue, $26,501,393 and Ebonyi $41,060,946.
Edo State’s foreign debt is $41,408,440; Ekiti, $34,071,754; Enugu, $47, 788,769; Gombe, $29,572,867; Imo, $50,573,894; Jigawa, $28,720,760; Kano, $59,400,227; Katsina, $74,147,092 and Kebbi, $47,132,689.
Kogi State owes $33,976,282; Kwara, $43,798,143; Nasarawa, $36, 547,616; Niger, $28,178,180; Ondo, $52,255,534; Osun, $61,744,688; Rivers, $34,301,764; and Sokoto, $40,419,413. Others are Yobe State, $31,111,004; Zamfara, $26,329,259 and the Federal Capital Territory, $37,671,245.
On Rivers, the State Commissioner for Finance, Dr. Peterside Chamberlain, explained that the current administration had borrowed N30bn in October 2010, an amount that was paid off in September 2011 and that another loan of N20bn was accessed in July 2011 from Guaranty Trust Bank and Zenith Bank and noted that a substantial part of the loan from Zenith Bank had already been paid back. The commissioner further pointed out that the funds were used to finance the state’s ongoing electricity project, which would be completed by December 2012.
To demonstrate the seriousness of Gov. Amaechi careful management of the resources of Rivers State, he immediately on assuming office in 2007 constituted his Cabinet with men and women of integrity and seeing the decay in infrastructure in the State commenced his task by initiating and signing into law, Road Maintenance and Rehabilitation Agency Bill No. 3 of 2008, Sustainable Development Amendment Bill No. 1 of 2008, procurement public bill, Saving Public Fund Bill and even a bill excluding the office of the Governor from signing and awarding of contracts. The fact remains that no other State in Nigeria has such laws in operation excluding the Governor from interfering and awarding of contracts and saving part of its revenue for the rainy days. With the enactment of these bills, the Governor demonstrated early enough the type of governance he intends to bequeath to the State – Governance premised on Accountability, service delivery, people orientated government for the greater good of Rivers people.
According to Rt. Hon. Amaechi, ‘in order to lay a strong foundation for positive change in governance in the State, the administration has taken it upon itself to initiate very critical bills on fiscal responsibility to the State House of Assembly and virtually all of which have been passed into law and assented to by me. The Executive arm of government so far has credit for having at least 60 per cent of all bills passed by the House of Assembly, saying that virtually all the bills were designed to deal with the age long problem of financial irresponsibility and rascality and as far as the existing laws on fiscal responsibility are concerned, anyone in government who tries to have an over sight of the due process mechanism in the State would surely run into problems’.
Apart from initiating critical bills for the economic revolution in the State, the Governor inaugurated a high powered Economic Advisory comprising of the best brains in Rivers State the includes Prof Nimi Briggs as Chairman with Prof Tam David West, Engr. Tonye Princewill, Barr Ledum Mitee, Dr Chamberlain Peterside amongst others as members. Speaking while inaugurating the Council, Gov Amaechi said the task before the high-powered team was to make recommendations that would attract new investors and make old ones more profitable. The governor said the responsibility of the State government was to abide by the blue print for economic development of the state because government alone cannot be the sole producer of funds and employment. He noted that the present security challenges in the Niger Delta cannot be an excuse for mass poverty in the state. He explained that the present economic position of Rivers State was worrisome because a lot of companies have down-sized their operations while others have closed down completely.
In the same vein, the Governor set up a committee headed by the Deputy Governor, Engr. Tele Ikuru and made up of members of the Nigerian Society of Engineers, Quantity Surveyors, Urban and Regional Planners, Architects, amongst others, to produce a blue print for the infrastructural development of Port Harcourt. According to him, “we are determined to confront the challenges of infrastructural development in the state, but while you make suggestions in that respect, it is not the primary assignment of the Economic Advisory Council because your task is to look at the micro and macro indices of economic growth bearing in mind our limitations as a state government”.
The State Chief Executive hinted that the State cannot affect the price and value of the dollar but can codify taxes payable in the State and utilize that to ensure that investors have a clear picture of business opportunities that abound in the area.
He promised to introduce fair reaching objectives and workable formula that would entice banks to support the indigenous businessmen and women by conceptualizing policies that could reduce poverty in the state.
The Governor hinted that the members of the economic council were chosen strictly on merit, as no consideration was given to where the person comes, adding that the challenges of the assignment which is remuneration free, was enormous but God has given the state competent, knowledgeable and capable persons.
Prof Briggs the Chairman of the Economic Team assured that they would examine the issues seriously and proffer solutions that would assist the State move forward while congratulating the Governor for the decision to find solution to the economic problems in the State.
Apart from the above, Rt. Hon. Chibuike Amaechi set up an agency called Bureau on Public Procurement alias ‘Due Process’ with the highly respected Barr Franklyn A. Nierum as its Director General. This is a man who due to his sterling and uncompromising attitude to corruption is hated by many of the government officials and contractors who see him as an enemy of the system but most certainly loved by Gov. Amaechi who sees in him the key to stopping corrupt practices in the State. This Commission is to monitor projects, ensure proper valuation and costing of contract in line with the market value thereby reducing corruption and inflation in the system and ensuring that credible and capable contractors execute government projects in the State.
That notwithstanding, the key to prudent management of our public fund lies in the hands of the type of Officials Amaechi appointed to handle the Finance and Budget Planning Ministries in the State.
The appointment of this unassuming and silent revolutionist, Mr. Levi Gogo Charles to head the Ministry of Budget Planning was a most welcome development in this regard. This young and vibrant man has instilled probity and financial discipline in the system that some of us in the Re-Election Campaign Team of the Governor saw him as the obstacle why funds were not properly released to the Team to execute its task because of his very stingy, strict sense in the disbursement of public funds and was nearly lynched in one occasion but the then Director General of the CRA Campaign Team, Chief Barr Nyesom Wike the proponent of Anaya-Neli and now the State Minister of Education prevailed and authorised immediate release of funds for the execution of the then pending issue.
To Nigeria, the key to its financial challenges is Mrs Ngozi Okonja-Iweala but to Rivers State its own key to prudent management of public fund is Dr Chamberlain Peterside. For avoidance of doubt, Chamberlain, a renowned world financial columnist was the Founder & President of New Era Capital Corp. MyCompletefinance.com, a New York based financial services group. He was previously a Financial Advisor in the Global Private Client Group of Merrill Lynch. Chamberlain whose background is both diverse and in-depth holds a Ph.D degree in Economics/Finance from a University in Europe. His company is based in Moscow and London and is involved in conducting marketing research and financial analysis for foreign companies focused on the new markets of Former Soviet Republics. After a stint in Wall Street in Global Wealth Management, he launched his latest enterprise, which seeks to capitalize on the power of technology to deliver high quality and efficient financial solutions. How Amaechi succeeded to convince this world renowned economist who has lived most of his life in America to head the Ministry of Finance as a Commissioner is still a wonder to most of us.
According to this genius and a gift from God to the people of Rivers State, the State was able to generate internal revenue of N36B through IGR as at July, 2012 while the saving from the monthly compulsory levy is now N34B. “The policy thrust of the present leadership of Rivers State under the watch of Rt. Hon. Chibuike Rotimi Amaechi is to maintain a robust public financial management structure that could bring about efficiency and effectiveness. The position of government on prudent management and accountability were responsible for the successful execution of various ongoing projects in the State and the administrative policy of instilling financial discipline is appropriate and timely”.
Explaining his plans for Rivers State Economy, Dr Peterside disclosed to me that his mandate was to help sustain the development, projects and the investments that the governor was working on. He said, “I do have a work plan. We have a series of initiatives to put together, which I have shared with his Excellency and which he fully supports. “One of the several aspects of our work plan is to reposition the internal Revenue Board to be able to grow our Internal Generated Revenue (IGR), the other is developing human capital in the finance ministry and bringing about high level of efficiency in resource allocation and as much as possible diversifying from and reducing our dependence and reliance on federal allocations in our investment programmes. You would not ultimately move away from federal allocations totally, but we believe that over the next one year and beyond we should be able to get at least 50 percent of our total revenue from internal sources, which is from IGR. Right now we are getting about 15 to 20 percent of our total revenue from internal sources”.
Rivers State has a potential tax base, we have companies that are operating here, we have a huge market in the hospitality space, we have a lot of employees that are based here, working here but sometimes their taxes are accounted for in other jurisdiction, we want to be able to capture some of them. So the approach is multi-dimensional, “he said.
Another part of his plan is to seek avenues to increase revenues from existing sources, making proper use of the recently launched Rivers State Geographical Information System (RIVGIS), which he described as a system that would help automate and hasten the issuance of C of Os.
He also gave the assurance that foreign investors would be drawn to Rivers State in his time as Commissioner for Finance. According to him, it had to do with creating an enabling environment coupled with a clear demonstration of the State’s appreciation of investment, commitment and openness to ideas as being exemplified by the state chief executive.
For three years now, the Rivers State government has worked hard to automate and digitalize its revenue collection and management operations, hoping to make internally generated revenue (IGR) the backbone of its revenue base. This dream was realized with the commissioning of an optic fibre-based Tax Management Software (TMS) under the watch of this wizardry of Dr. Peterside.
The state government was elated that the task of a target of up to N10 billion from IGR every month would be realizable. By 1999 when democratic rule returned to Nigeria, the then new administration led by Peter Odili met a mere N250million per month as IGR.
The governor worked assiduously to up this to about N2.5billion on the average. The current governor, Chibuike Rotimi Amaechi has moved this to as high as N5billion in December 2011, though the year's average was put at N2.6 trillion, according to governor's account to the people via the 2012 budget presentation. The determination to realize high IGR target of about N10billion monthly seems to inform his choice of finance commissioners..
The Special Adviser to Governor Amaechi on Internal Revenue Generation, Nwankwo Nwankwo, said; "This singular project will change the face of revenue drive and tax management in this oil-rich state. The Governor gave a free hand to the board and gave huge support to us. Skye Bank's energetic drive and the resources they have put into this project to bring us to where we are today are commendable." Now, a tax-payer could log on to the Board of Internal Revenue (BIR) website, carry out self assessment, pay online, and print out a receipt. Government officials think this would almost eliminate human interference in tax payments and remittances.
The Finance Commissioner, Chamberlain further said efforts were made to sustain the transition so that at no time should the state return to the analogue method and human collection of taxes. Lending his view, Alaliba Dokubo, Chairman, BIR expressed great joy, saying the board was proud of the automation and digitalization of its operations. She said Governor Amaechi was indeed an innovative Chief Executive whose determination for modernity was unequalled. The Nigerian Joint Tax Board (JTB) ICT Programme Advisor, Oduba Oduba, in his view, said Rivers State had moved far ahead of most other states in upgrading to TMS, saying BIR would now easily interface with the JTB.
With the reduction of the monthly revenue of the government from N18 billion to N13 billion despite the fact that the wage bill is rising coupled with the plan by the state to employ 13,000 teachers which would further increase the state’s monthly wage bill; the need for the State to improve on its Internal Generation Revenue becomes imperative. In this regard, the Governor has emphasised seriously that the government would soon embark on intensive revenue drive by going from house to house to collect taxes from the people. Amaechi said government would be better off if it could receive the N18 billion monthly and urged the residents to pay for services rendered them.
The efforts of another genius in Amaechi’s administration, Barr Chuma Chinny the Commissioner of Commerce and Industry who has organised Summit and have most of the Companies and Business interests in the State registered to ensure that they pay their taxes accordingly and promptly coupled with the position of the Fitch Rating comes into play if applied judiciously. According to Fitch Ratings revised Rivers State Rating Outlook to Positive from Stable on 2 December 2011 has subdued restiveness and supports oil production, thereby offsetting rising financial debt. With the eventual removal of the fuel subsidy, it could further boost oil revenues but Rivers is committed to developing internally generated revenues (IGRs). A 3% social services levy, and re-directing companies to pay taxes in Rivers, instead of where they have headquarters, could push IGRs to NGN10bn per month by 2014 from NGN4.5bn in 2010. Fitch expects the growth to be more gradual and IGRs to eventually top NGN100bn in 2013, representing 30% of Rivers' annual income, a substantial improvement from NGN30bn in 2009.
CONCLUSION AND DEDUCTIONS
That the administration of Governor Amaechi has embarked upon many projects unprecedented in any other State in Nigeria that includes, setting up of the Songhai Farms and the N20B Agric Scheme that will revolutionise agriculture in the State, starting off of the billion Greater Port Harcourt city to decongest the present Port Harcourt City and construction of one of the best stadia that hosted the last Sports Festival in the new city. Building and equipping 180 health centres across the state, constructing many roads and schools, embarking on a monorail first of its kind in Nigeria which the Governor has promised the completion of the first two phases by 2014. Upon completion, the monorail would transport 40,000 passengers daily.
Offer of scholarships to over 2,000 students in Nigerian Higher Institutions and spending of about N5bn for her students in foreign Intuitions. Building a world Class University which when completed will turn out well equipped graduates that will hold their own in any field and compete with the best in the world. Building in Rivers State University of Science and Technology a hostel that will accommodate about 6, 000 students and accommodation for all the Lecturers of the university. The university will be fully ICT compliant. It’s important to point out here that the Rivers State Government is among the few States in Nigeria that offer free education and free health delivery to its people but stands apart as the only State offering free education, free sandals, free books and free uniform in Nigeria. About 200 primaries schools have been set up in 200 communities, a feat that no other state is yet to accomplish.
Under Health; so far, about 100 medical Doctors have been employed to staff most of the Health Centres in the rural areas. The Rivers State Government has currently embarked upon the exercise to eradicate malaria vectors from the State. The Health Centre at the Rivers State University of Science and Technology will soon be opened to the public. The State was lauded last year for its daily commissioning of a health centre over a 60 day period in 60 communities in its 60-60-60 initiative. The Dental Hospital located in the Garrison area of Port Harcourt will soon be opened.
The Rivers State Government has invested over N100b per year from 2008 till 2011 in provision of roads, bridges and Social amenities. In this regard, the Government has engaged in the construction of 800km roads with 250 already completed. 10 major bridges under construction with 3 already completed. 20 minor bridges under construction with four completed, 2flyover/interchange under construction. 6 Land reclamation/shore protection projects at Andoni, Opobo, Buguma, Abalama, Olombie/Owukiri Island, Oba Ama, Okirika with 1,1400,000km 2 completed. 2 major markets and a shopping mall under construction (phase 1 of mile 1 market housing 960 shops and two banking halls completed). Apart from all these the Rivers State Government has built three power stations built at Omoku (150 Mega watts), Trans-Amadi (130 Mega watts) and Eleme (75 mega watts). By June, 2011, capacity will be increased to 500 Mega Watts under the $195 million dollars 180 MW gas turbine awarded to Saipem. Seven Transmissions stations (132/33 kilo volts) and 7 Distribution injection sub-stations 33/11 Kilo Volts built. The security and freedom the people of Rivers State are now enjoying can only be appreciated if the scenario and state of Rivers State before Gov Amaechi assumed office can still be remembered by our people.
It is on record that Rivers State has again been affirmed a ‘B’ international rating by leading international financial analysis agency, Standard and Poor’s (S & P) in a report released recently. The long-term outlook for the state is revised upwards from last year rating of "Stable" to "Positive" on the strength of significant ongoing infrastructural investments (in roads, ICT, health care, education and urban renewal) and relentless efforts to transform the public finance framework. All this would help lift the state's social and economic status in the long run. The agency in its 2010 credit analysis report on Rivers State, noted that the state currently had a high credit quality, owing to its strong cash holdings, low debt and a healthy operating balance. More importantly, the state’s efforts towards modernising public sector administration, which included information technology upgrade and an improved transparency and accountability in administration is a plus to the administration. Standard and poor’s also noted that Rivers has a strong liquidity base with no substantial debt burden. According S & P, as of July 2010, Rivers continued to enjoy a very comfortable liquidity position. It had N43.9 billion in local currency and $11 million in U.S. dollars. By this overview, cash holdings in the state at the end of 2010 should be at around N50 billion, based on Standard and Poor’s assumption of N200 billion”.
In appreciation of all these feats, the Rivers State Governor, Rt. Hon. Chibuike Rotimi Amaechi has been conferred with the prestigious “SERA’s” award for his contributions towards the social development of Rivers State, in line with the objectives of the Millennium Development Goals (MDG), especially in the areas of Health and Education.
While I know the difficulty in managing public fund, Gov Amaechi has demonstrated a high level of skill, integrity, probity in this regard. The numerous projects completed and ongoing in the State is a clear indication that the Governor indeed deserves encomiums from all and sundry rather than being vilified by some people. He and his team certainly deserve kudos for prudently utilising the public fund of our people wisely. To Malcolm X, “When you have a philosophy or a gospel--I don't care whether it's a religious gospel, a political gospel, an economic gospel or a social gospel--if it's not going to do something for you and me right here and right now--to hell with that gospel.” One can state unequivocally that Governor Amaechi has invested the resources of the people of Rivers State wisely and judiciously and that the Punch’s investigations stand on the State finances did not come to some of us keen watchers of this administration as a surprise. To Amaechi and his Team, kudos as history will surely be fair to you all.
Eze Chukwuemeka Eze is a Media Consultant based in Port Harcourt