Quite a few Nigerians have commented on the structural issues plaguing governance and nation building in Nigeria over the years and since independence. Our country has particularly been hindered by the “big man” syndrome since the first coup of 1966. Given the lop-sidedness of our constitution evidenced by the excessive concentration of power in the federal government and executive arm of government, it is hardly surprising that we have become beholden to the messianic politician who promises to fix our problems out of the goodness of their heart. Whilst the constitution enslaves us to this messianic executive, the reform our governance needs requires near equal cooperation from the legislative arm of government to succeed.

Candidates for executive office know the power they’ll have prior to getting to office and can promise to deliver heaven on earth on that basis when they get into office. Not so much Members of the federal legislature. The Members of the National Assembly make promises to their constituencies only and this can lead to conflicting agendas between constituencies even from the same State. Further, any one of these Members can be elected to principal offices in the NASS. The problem given our current state of affairs is that NASS principal officers do not have a national agenda. The welfare of their fellow Members is their principal task if they intend to retain their office. It is this lack of a national legislative agenda that informs some of the clamour for political parties to be ideologically based. The idea being that whichever party holds the majority in the NASS will be pushing to implement their party’s ideology on how a society should be run. Essentially, this is why it matters not who from the Democratic, Republican in US or Conservative, Labour parties in the UK is elected into principal offices – the policies they’ll pursue in government will align with their party’s ideology.

We’re all witnesses to the ineffectiveness of our current NASS and their failure to propose any meaningful agenda that advances our country and unlocks the legal bottlenecks that continue to be a headwind to our nation’s development. Whilst the executive arm controls the majority of the resources of government and is not unreasonable to expect it to be the arm that proposes most bills, this shouldn’t really be an impediment to the NASS itself taking the initiative in certain instances and set the ball rolling on reforming some of our laws. For example, the NASS can reform the Land Use Act without waiting for the executive to propose a bill on it. A lot of resourceful material has been written on the headwind that it is the Land Use Act for NASS to push a reform bill through.

Our current bunch of political parties are evolving slower than ideal and we can’t force them to clarify their political ideology(s) or announce where they’re positioned on the political spectrum. What should be easier to do is to require every party to have a national legislative agenda that is published in the same manner as the manifesto used by the executive to campaign for office. So when a presidential aspirant promises state police in their manifesto, the public can search the party’s legislative agenda to see if it has a working blueprint or legal framework that will establish a State Police Act that backs up the manifesto of the presidential aspirant. Besides the collective matching order that a party’s national legislative agenda will give its elected legislators, it can also help Nigerians avoid getting drawn into or distracted by the usual manoeuvring and infighting that seems to plague political parties once elections are over. Nigerians will be able to expect delivery of an agenda irrespective of who becomes Speaker or Senate President.

Our dysfunctional constitution compels us to focus on presidential aspirants during the general election, but we need to pay at least equal attention to the legislative arm of government and at all levels too.

The chatter about Nigeria getting back on the path of economic and political development has been going on for 50 years now. There’s been little to show that all the shouting has had effect. The closest we’ve come is the Nadeco shouting match against Abacha, even that needed divine intervention to succeed (relatively).

Whilst I personally haven’t engaged in the shouting match for long, I am becoming despondent about Nigeria’s future given the refusal of the old order to pave way for the young and energetic to takeover and even starker the fact that some of the young ones are beginning to demonstrate the same trait of the older generation that has led us to where we are.

So my appeal now is for a volunteer ward or local government, may be one in every geopolitical zone, to demonstrate whether we can actually organise ourselves as a modern society. Let’s test if we are even capable of that which we dream of. If we are not, then we stop trying and all man for himself.

Top down changes to bring about development seem impossible. We seem too divided to effect changes bottom up and wholesale. So we may as well try piecemeal bottom up changes.

Whichever local government volunteers will need to embrace everything that makes a society modern. Democratic politics, a government that acts with the knowledge that its power devolves from its residents, transparent public finances, trim and efficient public service, residents that pay their taxes, adhere to their civic responsibilities strictly and be socially responsible to their fellow residents. The volunteer local government will also need to commit to providing progress reports, preferably online, so we can track their successes, challenges and failures for learning purposes.

It won’t matter which party controls the volunteer government as all parties lay claim to having the solution to our problems. Let them demonstrate it with little so we can trust them with much in the future. In fact each party that controls at least one local government can volunteer a local government that demonstrates or to demonstrate the efficacy of its ideas or party manifesto.

So, are there any takers?

PS- apologies for any errors. Hurriedly written.

A rough idea on funding infrastructure….

In addition to all the reasons espoused by Dr Nonso as to why this $30b loan request by the FG is a no-no and that the senate was right to say no, my personal grouse is that this government suffers from trust deficiency when it comes to economic management. In addition, Nigeria’s governments at all levels have proven to be inefficient allocators of capital. There have been little instances where the government has successfully intervened in sectors and have been prone to interference. Finally, the election cycle of governments incentivises short-term decision making which, if our history is anything to go by, near guarantees that the infrastructure projects that this loan will be spent on are likely to be influenced by political considerations rather than economic productivity expediency.

Given the above, I have this rough idea on how we could potentially navigate these Achilles heels. The idea is centred on exploring the ‘off balance sheet’ concept. Nigeria’s government finances are in dire straits, our debt to revenue ratio is atrocious so adding more debt to an already overburdened revenue profile doesn’t seem smart to me.

We can avoid all of the inefficiency, debt burden and potential politicisation of the selection of infrastructure projects if we turn the Nigerian Infrastructure Fund into a Special Purpose Vehicle (SPV) that is listed on the Nigerian Stock Exchange (NSE) but with the same vision and mandate. The government’s current holding in the Fund can be turned into equity. The NASS can legislate that the government must not hold more than 15% of the equity of the Fund. Given the strategic nature of the SPV, government can through the NSIA have a non-executive director on the Board of the SPV. The management of the SPV can then source for capital, raise debt from the financial markets as it deems fit to finance its projects. So rather than the FG looking for $30b to invest in infrastructure, it’s the SPV that will do this. The SPV could source for funding or enter into strategic partnerships with multilateral organisations like the IMF, AFC, IFC, World Bank, China EXIM etc.

NSE’s listing rules will apply to the SPV. Nigerians will be able to buy shares in the SPV directly, Pension Fund Managers (better than Fashola’s plan to raid pension assets)will also be able to buy shares or debts issued by the SPV. Foreign investors will be able to do likewise too. The SPV will pay dividends and interest on issued debts like a normal company would. Whilst Nigerians may be charged tolls or some other fees for using the infrastructure projects owned by the SPV, they can get this back through dividends or coupon payments.

Of course the initial executive management of the SPV will be influenced by NSIA but can be done in an open and transparent manner. Over time this will change as the broad shareholder base vote for subsequent management changes. As per normal listing rules, the SPV will need to publish audited accounts, release regular trading statements and provide guidance on the company’s financial performance. The current opacity of getting project details from government will be avoided as transparency will be inherent. The management of the SPV can have an endowment type mentality where its focus will be on generating healthy and steady long term returns. This will provide steady long term strategic vision with aligned implementation and efficient allocation of capital. The SPV can issue debts with long maturities say 25 years+ which should also help deepen our local corporate debt market.

The NSIA lacks real funding to make any meaningful impact, going down this SPV route can potentially unlock this.

The above is a rough idea I think has leg to run.

Written hurriedly, errors regretted.