My compatriots,
It is one year today since our administration came into office. It has been a
year of triumph, consolidation, pains and achievements. By age, instinct and
experience, my preference is to look forward, to prepare for the challenges that
lie ahead and rededicate the administration to the task of fixing Nigeria. But I
believe we can also learn from the obstacles we have overcome and the
progress we made thus far, to help strengthen the plans that we have in place
to put Nigeria back on the path of progress.
We affirm our belief in democracy as the form of government that best assures
the active participation and actual benefit of the people. Despite the many years
of hardship and disappointment the people of this nation have proved inherently
good, industrious tolerant, patient and generous.
The past years have witnessed huge flows of oil revenues. From 2010 average
oil prices were $100 per barrel. But economic and security conditions were
deteriorating. We campaigned and won the election on the platform of restoring
security, tackling corruption and restructuring the economy. On our arrival, the
oil price had collapsed to as low as $30 per barrel and we found nothing had
been kept for the rainy day. Oil prices have been declining since 2014 but due
to the neglect of the past, the country was not equipped to halt the economy
from declining.
The infrastructure, notably rail, power, roads were in a decrepit state. All the
four refineries were in a state of disrepair, the pipelines and depots neglected.
Huge debts owed to contractors and suppliers had accumulated. Twenty-seven
states could not pay salaries for months. In the north-east, Boko Haram had
captured 14 local governments, driven the local authorities out, hoisted their
flags. Elsewhere, insecurity was palpable; corruption and impunity were the
order of the day. In short, we inherited a state near collapse.
On the economic front, all oil dependent countries, Nigeria included, have been
struggling since the drop in prices. Many oil rich states have had to take tough
decisions similar to what we are doing. The world, Nigeria included has been
dealing with the effects of three significant and simultaneous global shocks
starting in 2014:
A 70% drop in oil prices.
Global growth slowdown.
Normalization of monetary policy by the United States federal reserve.
Our problems as a government are like that of a farmer who in a good season
harvests ten bags of produce. The proceeds enable him to get by for rest of the
year. However, this year he could only manage 3 bags from his farm. He must
now think of other ways to make ends meet.
From day one, we purposely set out to correct our condition, to change Nigeria.
We reinforced and galvanized our armed forces with new leadership and
resources. We marshaled our neighbours in a joint task force to tackle and
defeat Boko Haram. By the end of December 2015, all but pockets and
remnants had been routed by our gallant armed forces. Our immediate focus is
for a gradual and safe return of internally displaced persons in safety and
dignity and for the resumption of normalcy in the lives of people living in these
areas.
EFCC was given the freedom to pursue corrupt officials and the judiciary was
alerted on what Nigerians expect of them in the fight against corruption. On the
economy, in particular foreign exchange and fuel shortages, our plan is to save
foreign exchange by fast tracking repair of the refineries and producing most of
our fuel requirements at home. And by growing more food in Nigeria, mainly
rice, wheat and sugar we will save billions of dollars in foreign exchange and
drastically reduce our food import bill.
We resolved to keep the Naira steady, as in the past, devaluation had done
dreadful harm to the Nigerian economy. Furthermore, I supported the monetary
authority’s decision to ensure alignment between monetary policy and fiscal
policy. We shall keep a close look on how the recent measures affect the Naira
and the economy. But we cannot get away from the fact that a strong currency
is predicated on a strong economy. And a strong economy pre-supposes an
industrial productive base and a steady export market. The measures we must
take, may lead to hardships. The problems Nigerians have faced over the last
year have been many and varied. But the real challenge for this government has
been reconstructing the spine of the Nigerian state. The last twelve months
have been spent collaborating with all arms of government to revive our
institutions so that they are more efficient and fit for purpose:
That means a bureaucracy better able to develop and deliver policy
That means an independent judiciary, above suspicion and able to defend
citizen’s rights and dispense justice equitably.
That means a legislature that actually legislates effectively and
Above all; that means political parties and politicians committed to serving the
nigerian people rather than themselves.
These are the pillars of the state on which democracy can take root and thrive.
But only if they are strong and incorruptible. Accordingly, we are working very
hard to introduce some vital structural reforms in the way we conduct
government business and lay a solid foundation on which we can build enduring
change.
An important first step has been to get our housekeeping right. So we have
reduced the extravagant spending of the past. We started boldly with the
treasury single account, stopping the leakages in public expenditure.
We then identified forty-three thousand ghost workers through the Integrated
Payroll and Personnel Information system. That represents pay packets totalling
N4.2 billion stolen every month. In addition, we will save Twenty-Three Billion
Naira per annum from official travelling and sitting allowances alone.
Furthermore, the efficiency unit will cut costs and eliminate duplications in
ministries and departments. Every little saving helps. The reduction in the
number of ministries and work on restructuring and rationalization of the MDAs
is well underway. When this work is complete we will have a leaner, more
efficient public service that is fit for the purpose of changing nigeria for the
good and for good.
As well as making savings, we have changed the way public money is spent. In
all my years as a public servant, I have never come across the practice of
padding budgets. I am glad to tell you now we not only have a budget, but
more importantly, we have a budget process that is more transparent, more
inclusive and more closely tied to our development priorities than in the recent
past. 30% of the expenditure in this budget is devoted to capital items.
Furthermore, we are projecting non-oil revenues to surpass proceeds from oil.
Some critics have described the budget exercise as clumsy. Perhaps. But it was
an example of consensus building, which is integral to democratic government.
In the end we resolved our differences.
We have, therefore, delivered significant milestones on security, corruption and
the economy. In respect of the economy, I would like to directly address you on
the very painful but inevitable decisions we had to make in the last few weeks
specifically on the pump price of fuel and the more flexible exchange rate policy
announced by the central bank. It is even more painful for me that a major
producer of crude oil with four refineries that once exported refined products is
today having to import all of its domestic needs. This is what corruption and
mismanagement has done to us and that is why we must fight these ills.
As part of the foundation of the new economy we have had to reform how fuel
prices had traditionally been fixed. This step was taken only after protracted
consideration of its pros and cons. After comprehensive investigation my
advisers and I concluded that the mechanism was unsustainable.
We are also engaged in making recoveries of stolen assets some of which are in
different jurisdictions. The processes of recovery can be
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