The Racket at Yaba LCDA

Governor Fashola recently stated that  local government officials involved in "traffic management do not represent any local government. My personal experience begs to differ. 

point of arrest

Recently on my way back to Lagos Island from Yaba,I was stopped by a uniformed Yaba LCDA (Local Council Development Area). Uniform pictured below

 The officer said I had passed one way (pictures of the said one-way below) and that I would be cautioned. The  "caution" was that I would go back and pass the right route. I agreed and he entered my car. Once inside, he instructed me to drive to the LCDA office. 

(I was behind another car that was"arrested". Anyone plying this route would notice that cars driving North divert and face cars going South) like below. I was going South and yet was the traffic offender. 

I was in no mood to argue with the arresting officer.  A man pictured below approached me and asked where I was coming from, where I was going, where I lived and worked and I told him all except where I worked. He tried to make me offer him a bribe and I refused. I told him to let me know my fines and I would pay. He said I would do a psychiatric test, pay N25,000 fine, N500 gate pass and N2000 for tax clearance. When I heard the tax clearance, I asked why? I told him I don't have one, what if I am unemployed? I asked him to let me make some calls and after 5 minutes, he began to harass me for my keys and when I refused to hand it over, he told his officers to deflate my tyres. Then, I saw a man who looked like his boss, approached him  and told him what had  happened. He requested for the pictures they took of my offence ( which I was not allowed to see) and said it was one way. I mentioned the 2000 tax clearance fine and he asked who told me to pay that and I pointed to man pictured below. He requested for the booking sheet and changed my fine to N15500. I paid the fine. 

Trouble began when I requested for a receipt. Officer above issued the gate pass but was reluctant to issue a receipt. Booking officer (below) was also reluctant to issue a receipt.

After making a serious fuss and calling "the boss" that reduced my fine,a lady approached me, gave me N5000  and said the boss said it should be returned to me and I was given receipt below that did not state the full "offence"

I tried to reach the numbers of the LCDA chairman (Jide Jimoh on his number given on the LCDA's website)  and the Council Manager (Tunde Ojikutu) and the lines were switched off. Dear governor Fashola, miscreants are not running this racket. It is run by Local government staff and this is another example of the impunity that occurs in Lagos state. 

Read More

A thought on security

There have been suggestions that Boko Haram members are non-Nigerians who are recruited to wreck havoc on Nigeria. Proponents are yet to show what  the external architects of Boko Haram would benefit from the siege in Northern Nigeria. Yet, this line of argument is supported by the discovery of 1487 illegal entry routes earlier in the year. The issue is not that these routes were discovered but what is being done to address unauthorized entries into the country even at legal routes. My thoughts is nothing is being done

Here is a picture of the Seme border- the entry from Benin Republic to Lagos.

Seme (Lagos-Benin) border

At the border, Custom, Immigration and NDLEA officials (they either come into your bus if you are in a bus or you walk to the container-office that houses them) check you,your passport and yellow card. If you "pass"(smile well, play dumb or tip well), you fill a higher education note book with your details, your passport is stamped and you can proceed. If  you find this process stressful, you can pay a bike rider to carry you across after bribing the appropriate officials.  At the borders and airports, no biometric information is captured and you can be who you want to be. Yet, the country wants to tackle insecurity and Boko Haram. With this state of laxity at the commercially busy Seme border, imagine what other border posts look like.

Compare Lagos-Seme border with the Hilla Condji border (Togo- Benin border)

and the Bietbridge border (Zimbabwe- South Africa border) 

Source:http://en.wikipedia.org/wiki/South_Africa–Zimbabwe_border

or Candian border

Source: http://blog.firstreference.com/wp-content/uploads/2011/12/Border.jpeg              

Finally the US border

Source: http://www.ezbordercrossing.com/list-of-border-crossings/new-york/champlain-lacolle/

The negligence towards the Country's security has little to do with corruption. It is inefficiency and incompetence. What would it cost to construct gates, train staff and computerize entry and exit points into the Country? Just wondering (and I am willing to learn), apart from smugglers, are there any other groups that benefit from this carefree approach of the government?

Read More

Sovereign Wealth Fund

source:nsia.com.ng

On the 18^th of September, the Nigerian Sovereign Investment Authority invested $200 million  of the $ 1 billion allocated to it in US bonds. NSIA is the organization that is responsible for Nigeria’s Sovereign Wealth Fund (SWF). Most SWFS are investments by countries and are funded by budget and/ or balance of payment surpluses. They have their origins in commodities (additional profits from natural resources. An example is Nigeria and the commodity is oil) or non-commodities (such as transfer of assets from foreign reserves). 

The  main purpose of a SWF is to act as a rainy day fund for countries.It can be likened to  University endowment funds. The difference is the source of funds. For University endowments it is donations but for countries, it is out of pocket. The objectives of the Nigerian SWF are to: receive, manage and invest in a diversified portfolio, save oil revenues, develop infrastructure that would aid growth, provide stabilization in times of economic stress and be a last resort for budget deficits. SWF was established by an act of the National Assembly in 2011. 

The fund is divided into: Stabilization fund, future generation fund and infrastructure fund. SWF is a good policy because it creates rules and structure around the additional revenue the government gets from oil. Presently, all excess revenues derived from oil go into the Excess Crude Account (ECA)  set up in 2004 by President Obasanjo. Usually, for a financial year, the government sets a benchmark price for oil. For instance, in 2013 oil would sell for $70 per barrel. If oil sells above that, e.g $200, the extra $130 goes into the ECA. In 2004, ECA had about  $5billion and grew to about $20 billion in 2006. That account now has approximately $3.6 billion. Earlier this year, the minister of Finance stated that about N606 billion from ECA was used to supplement the shortfall in the Federation account (account where all the tiers of government share revenues). 

There are 2 issues with ECA. The president set up the fund  without the consent of governors and the president exercised (still exercises) discretion on how the money is spent. i.e there is no transparency around the funds. The lack of transparency on how the ECA funds have been spent means that Nigerians cannot  pinpoint the benefits from the profits of crude oil in the past 9 years.  Therefore, SWF is a step in the right direction. 

SWF is also a good idea because it offers an avenue to use oil wealth to develop the nation before it no longer generates revenue. If funds are properly invested, are profitable and used for stated purposes,Nigeria may in for good times

However, the problem with NSIA is the nature of the investments made. If the country incurs losses on her portfolio, she is the poorer for it. For instance, Nigeria has invested $200 million in US bonds, if US had defaulted on its debts on the 17^th October, Nigeria would have lost some money though the country would not have been impacted like China and Japan. Thus, the structure around NSIA should focus on the type of investments to be made and the country’s risk appetite. Other countries use their funds to create State Owned Enterprises but we have tried that before and it failed (remember Nigerian Airways and Virgin Nigeria).

For the fund to function properly, the Federal government needs to get the consent of State governors. Some State governors have kicked against the fund and are in court over it. The additional profits from oil belongs to all tiers of government. It is against the principles of federalism if States are “forced to save” and SWF may not get beyond the $1 billion initial allocation given to it if  the court agrees with the state governors.

The impacts and successes of NSIA/ SWF remains to be seen and hopefully it would be an agency that truly benefits Nigerians

Read More

An outsider's view on the US crisis

Finally the  US shutdown began on the 1st of October after the near shut down of April 2011. The political atmosphere in the United States has been very divisive especially in Congress in the last four years. The activities of some US agencies  and departments are closed because Congress failed to pass  a resolution that would fund the government from the 1st of October. It is duty of  Congress to pass a  full budget by the 30th of September every year. This has not happened since 1997 but the Congress usually passed resolutions to fund the government.

The immediate cause of this shutdown is Senator Ted Cruz. He called for a shutdown if Democrats did not agree to defer and defund the Affordable Care Act (AKA Obamacare) which commenced on the 1st of October. ACA is a signature policy of President Obama and for all it flaws is a good policy that addresses America's health issues especially access to health care for the poor and working poor (aka uninsured). I have been unable to grasp why a country like the US lacked Universal health care till now considering that citizens of countries like mine want it but we don't have. 

The remote cause of the shutdown is partisanship, the inability to compromise and the rise of the vocal and resolute Tea party. If a group decides to have its way all the time, when push comes to shove, the other party would react.Funding the government should not be affected by a government legislation that was passed  by the House, though contentiously, and has received the backing of the Supreme Court. Since the Act was passed, Republicans have unsuccesfully tried to repeal it. 
States have a role to play in the success or failure of ACA. Rather than hold the Federal Government ransom, the GOP can take its battle to the States where  it currently controls policy and governance in 29 of the 50 states. 
Though the time for a showdown in Congress may be ripe because something has to give, it should not be at the expense of Americans and US's credit worthiness. Elected representatives seem to forget that the impact of their actions on the people who elected them. Like the Yoruba proverb that says "when two elephants fight the grass suffers", the effects of GOPs uncompromising stance affects Citizens and may have consequences they are not prepared for. 

The Shutdown has affected non-essential services such as National parks and other tourist attractions, NASA, Center for Disease Control, Bureau of Economic Analysis, Bureau of Labor Statistics,Environmental Protection, Commerce, Labour, parts of Transport Security Administration, Departments of Treasury and Energy. Fortunately,the impact of the shutdown has been more dramatic than economic.  The real problem would occur if the Debt ceiling (According to US Treasury, the debt ceiling  is the total amount of money that the United States government is authorized to borrow to meet its existing legal obligations, including Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments. The debt limit does not authorize new spending commitments. It simply allows the government to finance existing legal obligations that Congresses and presidents of both parties have made in the past) is not raised by the 17th of October 
The US would be affected because:

• The full faith and credit of the US would be jeopardized, and lack of confidence in the US's government stability may cause a run on the dollar,

• The dollar status as the world reserve currency would be threatened. This status has helped the US get lower interest rates compared to other countries, 

• The government would be unable to pay Social Sceurity, Medicare and Unemployment cheques. 

• If the US defaults and confidence is lost, mortgage and lending rates would rise and this would directly affect citizens

Historically, the US has been financed by debt  and since 1917 raising the debt ceiling was a routine decision by Congress until 2009 and 2011 where it became highly politicized. 

The lessons from the Shutdown and Debt ceiling drama illustrate  the ability of a few vocal people to cause unnecessary situations.Experiences should have taught Congress that investor confidence is key to the  survival of an economy like America's.The downgrade of her  credit rating after the near shut shut down in April 2011 and the world wide effect of the 2008 crisis should teach Republicans that there are times to be intransigent on political concessions and there are times to let things pass. It is  failure of Republican leadership to allow  a zealous few disrupt the activities of a nation. 
The United States is regarded as the embodiment of representative government. Elected representatives should listen to the people they represent and not cater to specific interests. 

Deuces

Read More