Tinubu’s Palliative For Poor Households

Nigeria’s President, Bola Ahmed Tinubu, recently unveiled an initiative by the Federal Government to provide financial support to 12 million poor households in Nigeria. The President shared details of the government’s plan to transfer N8,000 monthly to these households for six months.
Consequently, a request for a loan of $800 million for the social safety net programme has been granted by the Senate. The House of Representatives has also approved N500 billion as part of an amendment to the 2022 Supplementary Appropriation Act for the provision of palliative care.
The President highlighted that direct money transfers to poor families would have a far-reaching impact, with a multiplying effect on about 60 million individuals. To ensure transparency and efficiency, Tinubu emphasised that the funds would be digitally transferred to households, bolstering the initiative’s credibility and effectiveness.
This development came shortly after the former President, Muhammadu Buhari, sought Senate’s approval for an $800 million loan from the World Bank. It was to mitigate subsidy removal effects. The grant disbursement aligns with the planned removal of subsidies in June 2023, as previously stated by former Minister of Finance, Budget, and National Planning, Zainab Ahmed.
President Tinubu wasted no time in implementing the removal of fuel subsidies, formally announcing its end during his inaugural speech on May 29. The subsequent plan to transfer funds directly to poor households signifies the government’s seeming commitment to supporting those most in need to alleviate the impact of subsidy removal on vulnerable communities.
Some Nigerians have commended the move to disburse N8,000 for palliative care to indigent families. According to them, it would cushion the harsh effects of fuel subsidy withdrawal. However, others think that the policy would replicate the failed social security fund under Buhari’s administration. Buhari introduced the N-Power Programme, School Feeding Programme, TraderMoni, and others with no impact on Nigerians.
We consider Tinubu’s subsidy removal palliative scheme very disturbing. He should take a cautious approach to the policy. Clearly, he cannot cushion the effects of subsidy removal through the planned distribution of a paltry N8,000. A simple calculation shows that the said money will only amount to N48,000 for the proposed duration of six months. This mocks the poor and makes no economic sense.
The incumbent administration is treading the same path as its immediate predecessor. Nigerians will be subjected to the rigours of loan repayment. This meagre monetary palliative could barely feed a family of two for five days because of deepening poverty as a result of subsidy removal. It is unacceptable that Nigerians are presented with funds far less than what federal lawmakers are offered to refurbish their offices.
There are enough reasons to conclude that the N8,000 monthly handout to a mere fraction of the poverty-stifled masses would create another avenue for the corrupt enrichment of a few cliques in power. This was witnessed with previous poverty alleviation programmes of the All Progressives Congress (APC) namely the TraderMoni scheme, the Direct Cash Transfer and the School Feeding Programme supervised by the Ministry of Humanitarian Affairs and Disaster Management.
Regrettably, the new administration is unmindful of the worsening debt burden under which the Nigerian economy asphyxiates. The debt profile has further been worsened by the $800 million World Bank loan which is bound to widen the 2023 budget deficit. It is not surprising that the Senate quickly approved the $800 million loan to supposedly support poor and vulnerable Nigerians under the guise of the National Social Safety Net programme.
The N8,000 monthly payment is a Greek gift. While attempts are made to hoodwink Nigerians that the palliative is in their interest, the reality is that they would soon face further pains with the repayment of this loan which would increase the nation’s debt burden rather than alleviate the multidimensional poverty line.
The proposed monetary palliative would not help economically. Rather, the government should intervene in public transportation to alleviate subsidy cancellation. The palliative is another subsidy in disguise. They cannot declare subsidy a conduit and create another in its place. Tinubu should introduce policies that could be replicated worldwide. As with TraderMoni, the money palliative would breed corruption.
A country like Nigeria that has not reached optimal production levels should not resort to cash palliatives. It is appropriate in a country that has attained optimum production levels but people are restricted from working. An example of such is the United States where cash was distributed during COVID-19 restrictions because people could not venture out to perform economic activities.
It is expedient to fix the nation’s nonfunctional refineries and make them work at their maximum capacities. If refineries worked, their economic effects would immensely benefit the entire country. The government could also identify and rehabilitate some major federal roads in the Federation. The proposed palliative money should be jettisoned as it would still go into greedy politicians’ hands.