Planning The National Economy

In the words of Albert Waterson: “anyone who has thought much about planning recognises it as a complex and many sided phenomenon”. The complexity or variation in the concept of development planning is inevitable given the different institutional environment under which planning is being practised. For instance, in the socialist countries where it is the responsibility of the central authorities to take virtually all decisions regarding allocation of resources, planning is an integral part of the system. On the other hand, in a country like United States of America, where the allocation of resources is determined by production, sales and purchase decisions taken substantially by household and firms, planning is an adjunct to such market oriented system. In Britain and France, planning is done mainly to identify constraints, disseminate information and formulate targets for the whole economy.

Differences in levels of economic, social and political development of countries could also cause variation in the nature of planning. Such differences in the levels and patterns of development invariably result in different planning strategies and methodologies. For instance, to the developing mixed economies, planning is done to accelerate the rate of economic growth; it is a sine-qua-non for rapid economic development; their first step to Olympian heights.

From the foregoing, two factors more than any other condition the form and role of a country’s planning: its institutional framework and its stage of development.

Development planning in socialist countries is highly centralised. Such centralised form of planning goes under a variety of descriptions: planning by direction, totalitarian or authoritarian planning, and imperative planning. On the other hand, mixed economies adopt such other forms of planning as planning by inducement, democratic planning and indicative planning.

In terms of flexibility, we can classify planning into fixed and rolling plans. We can also classify planning into functional and structural planning when we are concerned with the type of planning methodologies required to bring about a structural change in society.

The desire of functional planning is to alter such economic magnitudes as national income. Investment, consumption and savings. In other words, the goal of functional planning is to achieve economic growth rather than economic development. On the other hand, structural planning is concerned with creating political sociological or cultural environment suitably oriented to the promotion of broad-based development.

The choice of functional planning may be appropriate for the developed countries considering the fact that their main concern may be the maintenance or perfection of the existing political and economic systems which are relatively okay at the moment. But for the developing countries such as Nigeria, Ghana and Liberia whose fundamental desire should be to effect not only economic changes but also social and political changes, the emphasis should be on structural and not functional planning.

In Nigeria, planning as an instrument of economic development dates back to 1946 when, following the initiative of the secretary of state for colonies in 1944, the Ten Year Plan of Development and Welfare came into operation. As noted by S. Tomori and F.O. Fajana “The plan however, did not run its full term because by 150, the inappropriateness of charting development over a period as long as ten years in a country experiencing rapid structural changes had become evident. Hence a decision was taken to break the plan period into five-year sub-period and to formulate a new plan for the period 1951 – 56”.

Since its independence in 1960, Nigeria has formulated and launched several development plans covering the periods 1962-68, 1970 – 75, 1975 – 80, 1981-1985. The fifth National Development Plan which was to immediately follow the fourth one (1981-85) was postponed until 1988 -92.

Ibrahim Babagida in late 1989 abandoned the concept of a fixed five-year plan and introduced a three year rolling plan for 1990-92 in the context of a more comprehensive fifteen to twenty year plan. For an economy facing uncertainties and structural changes, a rolling plan was considered more suitable.

Why? Because it provided for revision at the end of each year to accommodate new targets and projects.

The Olusegun Obasanjo’s administration introduced the National Economic Empowerment and Development Strategy (NEEDS) to confront the development challenges of the country. NEEDS is a reform programme. And according to its documents: “the reform programme is rightly ambitious. For one thing, we need focused goals and ambitions to make progress. The programme reflects the impatience of Nigerians to see quick and dramatic changes and also the fact that Nigeria has immense potential waiting to be unleashed, talents to be tapped. Having lost some decades, we are in haste to cover lost ground, catch up with our contemporaries and become the largest economy in Africa”.

State government and local government councils have designed and are implementing their own State Economic Empowerment and Development Strategy (SEEDS) and Local Government Economic Empowering and Development Strategy (LEEDS) respectively.

In terms of institutional framework for planning, there has been since after 1946 a conscious and deliberate effort to improve the process and machinery of planning in Nigeria. Now guidelines have been developed to ensure that all participants in the country’s development plans formulation, implementation, and assessment process are fully aware of their roles and responsibilities. The participants include: National Planning Commission, National Population Commission, Planning Departments in each Ministry of Budget and Economic Planning across the country, Federal and State Executive Councils, Donor Partners, Assessors, Supervisory Agents and Observers. Also such donor bodies as IBRD, DFID, EU, UNDP, UNICEF, UNPF, DFD, USAID and WHO have aligned their local programmes to support the development planning efforts of the country and improve the quality of their assistance to the nation.

Apparently, the essence of planning for development in Nigeria has been fully recognised. But the issue now is how to make planning effective both in conception and implementation to help establish the country firmly as “a united, strong and self-reliant nation, a great and dynamic economy, a just and egalitarian society, a land of bright and full opportunities for all citizens, a free and democratic society” being the five national objectives identified in the Second National Development Plan. 

Vincent Ochonma