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NEC urges States to reduce number of political appointees

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NEC urges States to reduce number of political appointees

NEC urges States to reduce number of political appointees
March 23
09:49 2016

The National Economic Council, NEC, on Tuesday ended its two-day retreat with a call on state governments to reduce the number of commissioners, permanent secretaries and other political appointees, even as it harped on the need for deliberate effort to generate relevant data on the respective economies of the states and the nation generally in order to drive revenue generation

Also as part of the resolutions reached on revenue generation and fiscal stability at the end of the retreat, NEC also resolved that the Federal Inland Revenue Service and the State Inland Revenue Service, SIRS, should invest in relevant technology to support efforts to improve tax collection.

“There is a need to develop incentive schemes for federal and state revenue generating agencies FIRS and SIRS need to actively collaborate on initiatives to improve tax collection, including joint audits of major corporate tax payers,” read part of the communiqué issue at the end of the retreat.
State governments were encouraged to establish efficiency units to review/enhance the quality of expenditure as well as plug revenue leakages and focus on property and consumption taxes will help in improving revenues in a fair manner

It was also agreed that tax-payer education be intensified to expand the tax base and avoid political backlash from intensifying tax collection.

The retreat also resolved that cost control measures be identified and implemented on an ongoing basis; in this regard various examples from Nigeria and other countries are recommended.
As regards investment, industrialisation and enabling monetary policies, it was resolved that the Ministry of Industry, Trade & Investment develop a matrix of actions to be taken by federal and state governments towards achieving the targeted improvements in ease of doing business ranking by 30th April 2016.

The retreat also resolved to “Present an incentive scheme for States taking actions towards improvement of the investment climate in their States including grants by 30th September 2016; forge strong links between the Nigeria Investment Promotion Commission, NIPC, and the State Investment Promotion Agencies”.

All states in the country were also asked to collaborate more actively on regional basis on investments and industrialization; while the Federal Government should work with the States and other stakeholders to create an enabling environment for trade and investment through the implementation of the Nigerian Industrial Revolution Plan, NIRP, to encourage industrialization.

According to the communique, state and federal governments must emphasize the patronage of “Made in Nigeria” products. “Import competition” rather than “import substitution” should be emphasized.

Meanwhile, the Federal Government says it has already planned to inject N350bn into the Nigeria economy which would be spent mostly on capital projects and job creation to stimulate the economy from the severe crisis it is facing as a result of dwindling oil prices.

The Minister of Finance, Mrs Kemi Adeosun, who disclosed this to journalists at the end of a two-day National Economic Council, NEC, retreat at the conference hall of the Presidential Villa, said the retreat, which was the first by the present administration, deliberated extensively on the drop in revenue, particularly as to how it affects the state government and their ability to pay salaries and fulfil other obligations.

According to her, “From the Federal Ministry of Finance in anticipation of the approval of the budget, we have virtually lined up about N350bn which we would be pumping into the Nigerian economy in the forthcoming months.

“We explained our rationale and the processes that we have put in place, safeguards to ensure that this money actually achieve the desired objective, which is to stimulate the economy.

“We are already discussing with some of the contractors who will be paid these monies and the objectives from the overall criteria is how many Nigerians would be re-engaged.

“We are specifically looking at contractors who have laid off staff and how many Nigerians are you going to put back to work as a result of this money that we are planning to release.
“We believe this would bring significant economic activity,” she said.

She continued that the general resolve of the council was that there was a need to bring in more cost efficiency in the operations of government, specifically the setting up an efficiency unit within the state governments, to rationalize expenditure and to increase IGR.

Adeosun said there was a need to generate data because data is the basis of any revenue collecting efforts, just as there was a need to develop incentives for both federal and state revenue generating agencies to ensure alignment of interest between the two arms of government.

She added that the governors were tasked to focus on property and consumption taxes in their states to help improve their revenue in a fair manner, stressing that “Tax payer education must be intensified and to expand the tax base and ensure that there is a buy-in in the revenue collection agencies from the populace”.

State governors were also encouraged to, where possible, rationalize the number of commissioners and general political appointees as well as adopt cost control measures to be able to sustain their states.

NEC also discussed the need to review the counterpart funding needed to access the Universal Basic Education Commission, UBEC, fund from 50 percent to 10 percent.

Noting that the states currently need to have a counterpart fund of 50 percent to access the UBEC grants, which upon review, would become 10 and 90 percent contribution, she stated that this will release an estimated “58bn naira that is currently un-accessed”.

The Minister said the council got to understand that with N53bn, Nigeria could revamp at least 1,000 of the worst classrooms in each of the 36 states.

She said the council also discussed getting a “legislative approval to change the need for counterpart funding on the part of state governments”.

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