SUSTAINING DEVELOPMENT IN A RECESSION (2)
The State of Osun has done remarkably in infrastructure development, writes Ileowo Kikiowo
Through the State’s partnership with the World Bank, The Osun Agency for Community and Social Development Project (OSUN CSDP), has reached 1,073,129 beneficiaries in rural communities by committing at least N2 billion to several social developmental projects. The partnership is delivering 356 inclusive, gender sensitive and multi-sectoral micro projects, covering education, rural electrification, primary health care, transportation, potable water provision in 263 communities across the state.
The government’s strategic investment in the critical basic education level has delivered training and re-training for over 21,017 teachers, giving the importance of these to the learning experience. So far, 277 model schools with 1,811 modern classrooms have been built or rehabilitated. The schools are being furnished with 26,922 sets of chair and table. Every school day in Osun, 253,000 elementary school children receive nutritious meals produced largely by local farmers, to boost health and cognitive capability at their formative stage, as well as boost local food production. The Osun School feeding programme is the longest running of its kind in the country.
In six years, Osun has through its basic education agency, invested over N8.5 billion to build capacity, both in human and physical infrastructure. This investment in education is driven by the resolve of the administration to equip the future generation of Osun with the best possible resources regardless of their background, so they can seek a better and prosperous future for themselves and consequently for the state.
As many states became fiscally unstable and shortfall in federally collected revenues continued to challenge salaries payment, the government of President Muhammadu Buhari heeded Osun’s push for interventions by helping her and other states restructure commercial loans into FGN bond with reduced financial cost and freeing of cashflow in August 2015. The FG also granted a concessionary loan to Osun and many other states to clear backlogs of salaries and to restore treasury and fiscal stability of these states.
The state government and the labour unions recognised that the current national challenge, resulting from dwindling revenues will continue to affect the payments of critical expenditure of government, which include salaries, wages and pension, after the exhaustion of the bailout funds. The labour unions agreed to accommodate the state government during this economic headwind, while the state government agreed to be transparent and carry the labour unions along.
The state government and the labour unions also agreed that whatever is available as net revenues accruing from Federation Accounts and internally generated revenues (IGR) will be apportioned in such a way that will take care of critical expenditure, wages, pension, salaries and other expenditure required to run government. This milestone agreement gave birth to the apportionment of revenue, called modulated salary.
From August 2015 till now, the prudent management of concessionary loan (bailout) and its subsequent revenues by the administration of Ogbeni Rauf Aregbesola has ensured salaries are paid and workers keep their jobs, rather than embark on mass retrenchment; an alternate idea other state governments have toyed with.
The salary regime ensures full salaries are paid to junior cadre in levels one-seven, while their senior counterparts are paid nothing less than 50 per cent or greater, depending on the level of income per month.
The government’s infrastructure development efforts has already started yielding results as investments and production has been on the rise in Osun: In 2009, the famous International Breweries, Ilesa, known for Trophy brand which serves the South West and beyond, doubled its production capacity to cater for the boost in local economy. Tuns Farms, an indigenous poultry company, in partnership with small holder farmers, ramped up broiler production to position the state as the second largest broiler producer in the country. Omoluabi Garment Factory, a Public-Private-Partnership between Sam and Sara Garments and the State Government of Osun emerged as the largest Garment Factory in West Africa. An indigenous computer assembly plant, RLG Adulawo also set shop in Osun as a result of the favourable infrastructure in the state. These and more are the direct and indirect investment results of the administration’s bet for a prosperous future and these efforts are paying off.
Consequently, Osun developmental programmes have also impacted on the socio-economic profile of the state as reported by reputable institutions. In 2015, The Oxford Poverty and Human Development Initiative (OPHI) rated Osun second highest in human development index among the 36 states in the country. In 2014, Renaissance Capital (RENCAP) in its 36 shades of Nigeria economic review of states ranked Osun as the seventh largest economy in Nigeria, while in 2013 the NBS rated Osun as the state with the lowest poverty rate in Nigeria.
In conclusion, was there a dearth in critical physical infrastructure in Osun before 2010? The answer is yes. Was there an urgent need to build the infrastructure? The answer is a resounding yes. Was the decision to debt finance the construction of the infrastructure a rational one amongst other options available? Yes! Has the state government properly managed the resultant downside risks involved in taking these steps? Yes! Nobody argues with results. The impact of the decisions taken by the present administration in the state continues to yield positive results from all available indices. Kikiowo wrote from Osogbo