With 541 federal ministries, departments, and agencies (MDAs) (as at end-December 2014), it is no surprise that the burden of governance has become disproportionately high in Nigeria. When over the weekend, I discussed this number (was speaking with someone who should know), my first reaction to the implications of this for efforts (over the medium term) at moving this economy forward was one of utter disbelief.
It did not help that of this number, about 24 MDAs where just created on a whim — no legal backing of any sort. I understand that (and here, I am paraphrasing this week’s edition of The Economist — albeit on a different topic) the world over, politicians react to flaws in whatever systems they are superintending over by “creating new bodies, without abolishing the old ones”. But how do you explain the fact that as at the same period, the federal government in the United States of America, a much bigger physical space, with far more people (and arguably pretty more diverse), and an indescribably bigger economy, had only 15 such institutions?
“Corruption”, our national hobgoblin, is one answer. A proliferation of government departments makes the fleecing of the state much easier. Anecdotal evidence exist to the effect that of the 75% which governments here spend on recurrent expenditure, and which we all agree is injurious to our development aspirations, only about 40% goes to meet the public sector’s wage bill. However, it would seem, too, that much of the 40% wage budget is paid to none staff.
Within this context, you then understand why few to none of our government departments have a sense of their collective staff strength. It helps the system that existing civil service rules apparently forbid external parties from conducting staff audits in the public sector. Add to this miasma a further fact: that the take home pay of federal directors-general, at about N600,000 monthly, would seem to take most of them way past their opulent abodes.
How then to clear this mist? This is arguably one of the biggest questions that the incoming Buhari administration must find quick responses to. That our way out of this maze includes eventual recourse to the Oronsaye Committee’s Report is increasingly a no-brainer. At 541 MDAs, our list of things “to do” includes both merging these institutions, and there is clear evidence of overlaps everywhere, and scrapping most of the rest.
This task is way beyond concerns over the financial burden of governance posed by overlapping government agencies. This plethora of institutions speak to a much deeper worry: we cannot run an efficient public sector with so many institutions battling away at the problem. The old saw about the damage that too many cooks wreak on the broth is most pertinent here.
Nonetheless, there is a human cost to rationalising these state agencies. What to do with the staff that eventually turn out to be surplus to requirement? This is as much a social problem (from the prospect of more Nigerians being unable to meet their basic needs as a result of lost earnings and the resulting destitution) as it is an economic one (this earnings loss invariably means fewer consumers spending on basic needs, and the consequent effect on domestic output growth).
In search of a proper response to this challenges, I have argued previously, that the current nature of the public sector’s financing suggests that we may be able to dispense with the services of such personnel while continuing to pay their salaries (over a 5 to 10 year period, maybe. This detail matters far less, though, than the need to include a sunset clause in any such arrangement).
This solution is possible if, as seems increasingly the case, the bigger portion of our current recurrent spend is frittered away via the overheads line. Shutting down an agency of the state, while continuing to pay salaries, therefore, should have us save on overheads, which on current estimates is around 60% of this cost.
Thankfully, though, the universe of possible savings is much wider. And this is where technology and biometric identification measures make meaning. Eventually, though, the preferred solution to this problem is one that allows us a proper headcount in all ministries, departments and agencies of the state.
This is one big challenge the Buhari administration must quickly come to terms with.