26 April 2019
With the new minimum wage due to be effective, the wage bill of the state government coupled with high number of political appointees will be unsustainable. We cannot rely on support from federation accounts, moreso it is obvious we receive the least nationally. We cannot rely on short term bank loans since it is obvious we have ran out of room. We may not rely on external borrowing from foreign sources since the federal government has declared Cross River, Zamfara and Osun states as insolvent and unable to get CBN support guarantees to borrow, we cannot rely on private equity firms who will always talk about monetizing assets to raise loans, those talks end on board meetings, for much of Africa they never materialize.
To get it right, the state should reduce her overall monthly wage bill to be equal or lower than the monthly IGR in the state, that’s below 1.5 billion, what that implies is that with the new minimum wage, while civil servants salaries will increase, 95% of all political appointees should be allowed to go as we enter the new term. Only appointees whose portfolios are generating income for the state, or those whose portfolios are contributing to sustainable policies and development of social infrastructure, Peace and State security should be allowed to continue. While these may create some short term economic hardship, more appointees may be called on board as the state finances balances up.
Secondly, if we must survive and meet up with our obligations and be able to complete most of the states industrialization programs, everyone must make some sacrifice. Taxes must be increased and internal generated revenue drive must be embarked on vigorously. Within the next 12 months, we should be able to increase the states IGR by at least extra 200 percent. This is going to be tough, most people will get angry, businesses may threaten to leave the state, but that is a sacrifice we must do if our books must continue to be green.
We were lucky in the past term, we got bail outs and Paris refunds, these helped us to catch up, but going forward, we may not have any free money apart from our federal allocation in which we are the lowest in the country. We have to be realistic, we need to cut our coat not according to our size, but according to the cloth we have. Gestation period for most completed industrial projects has expired, its time our factories start making money. The state should position herself to attract donor funds and grants.
The state security apparatus should as a matter of urgency address kidnapping saga going on, that’s sufficient to scare investors. Let’s put our hands together to support the state irrespective of party difference, getting it right and making cross river state great again is a task that must be done. God bless you.
Princewill Odidi writes from Atlanta
