Is Nigeria fighting or supporting poverty?

Nigeria’s decision to fight poverty has been hailed by many, but the government’s actions to achieve this goal are at variance with the declaration. Without a change in the approach to this anti-poverty war, this exercise is bound to fail, while the number of Nigerians living in absolute poverty will increase.

In his May Day speech on Monday, the Minister of Labour, Employment and Productivity, Dr Chris Ngige, gleefully announced to the whole world that Nigeria now transfers billions of naira bimonthly to vulnerable households in the country. Vulnerable households are by definition poor, so the transfers are invariably designed to help them fight poverty.

Ngige disclosed that: “In 2016, President Muhammadu Buhari launched the National Social Investment Programme, currently the largest of such programmes in Africa and one of the largest in the world.”

The minister went on to disclose that the National Social Register of Poor and Vulnerable Nigerians (NSR) currently has 32.6 million persons from more than seven million poor and vulnerable households, identified across 708 local government areas, 8,723 wards and 86,610 communities across the 36 states of the country and the FCT.

He also declared that: “From this number, 1.6 million poor and vulnerable households (comprising more than eight million individuals in 45,744 communities from 5,483 wards of 557 LGAs in 35 states and the FCT are currently benefiting from the Conditional Cash Transfer programme, which pays a bimonthly stipend of N10,000 per household.”

The reference to this so-called NSIP as “the largest of such programmes in Africa and one of the largest in the world” is absolutely unnecessary in the speech, except for the want of relevant material to fill the space for the minister.

To put the facts in context, Nigeria is currently (and has been so for quite a long time) home to the largest number of poor people in Africa. So, any programme designed to solve the problem of poverty in Africa will have the largest number from Nigeria. Globally, Nigeria is also high up there when it comes to poverty incidence, so again, we must rank tops in the world for programmes designed to tackle poverty.

These superlatives rather seem to be designed to hide the inappropriateness and ineffectiveness of this cash transfer scheme as an anti-poverty policy. Whatever the size of the register of Nigeria’s poor people, that is irrelevant to the question of whether the system is helping the poor to get out of their state, or is it rather creating a dependency syndrome among them.

If 1.6 million Nigerian households or the equivalent millions of Nigerians now receive alerts into their accounts every two months from the federal government as transfer payments, how does this add to the fight against poverty, unemployment, etc? In economics, transfer payments are payments made to individuals for no work done. Are these what Nigeria need at this time?

Announcements of these free things without first addressing the fundamental distortions in the local economy will hurt the full recovery. Genuine efforts should be made to put people to work so they can earn wages.

Wages and transfer payments have different effects on the economy. When people earn wages, they help in producing goods and services. So, why can’t our governments- federal and states- embark on mass public work programmes and employ millions of idle Nigerians? This will have the double advantage of reducing the rank of unemployed Nigerians and at the same time solving the problem of monetary poverty, while raising our national output of goods and services.

Any measure aimed at solving the country’s poverty problem without a wellthought-out employment programme is destined to fail. This is why this cash transfer scheme can go on for years without making a dent in the poverty measure. The truth is that when people are given transfer payments, they have some purchasing power but without a corresponding increase in the output of goods and services. Making them look forward to N10,000 alerts every two months is at best a psychological play to keep them perpetually in a dependency mode.

This is likely to breed more poverty, not less. It could create a culture of complacency rooted in a false sense of security. Poverty in Nigeria is no longer a short-term phenomenon, a fact that this administration can attest to. Therefore, using an unsustainable cash transfer programme to address such a deep-seated problem is a policy mismatch

By the way, what does the government do with its own statistics? Late last year the National Bureau of Statistics told Nigerians that 63 per cent of us are multidimensionally poor. With an estimated population of about 211 million then, that translated to 133 million people living in multidimensional poverty. Add that to the projection by the Brookings Institution that the number of Nigerians living in absolute poverty will rise from 87 million in 2018 to about 107 million in 2030 (seven years from now).

The World Bank has also given estimates of the number of Nigerians who have been pushed into poverty by various economic and social forces. According to the Bank, as many as seven million Nigerians were pushed into poverty in 2020 by rising prices; and, since then, many more millions have followed suit. These and more should inform the government that tackling Nigeria’s poverty challenge has passed the days of tokenism when uncoordinated policy statements were presented – and implemented – as catch-all magic wands.

“To eradicate poverty “in all of its forms and everywhere,” the policy discourse needs to focus more directly on the poorest of the poor and tackle more fully the non-income dimensions of poverty,” the Bank has said in a paper, Monitoring Global Efforts to Eradicate Poverty.

So, how does a monthly transfer payment of N10,000 to a multidimensionally poor household address its challenge, including the income poverty aspect? How does this amount fit into the multidimensional nature of the poverty that this household faces? How does it address the question of access to health facilities in the locality where they live, or unemployment?

Many people today, including this writer, prefer programmes designed to tackle poverty through the multidimensional angle, to these cash-based efforts. The reason is clear: the former is less open to abuse than the latter. Where are those vulnerable households? Who identified them, and what are the assurances that they do indeed get the N96 billion given to the 1.6 million of them each year?

These are the questions. These are the concerns. And they are real issues in our environment.