Business

Nigeria: Palliative – No to ‘Cash Transfer’


Nigerians are delighted that President Bola Tinubu is set to roll out some relief measures to cushion the biting effects of the implementation of petrol subsidy removal. But we are firmly opposed to his resort to the discredited “cash transfer” approach.

The President said: “The palliative is coming. I don’t want cash transfer to fall into wrong hands…”

He has already asked the National Assembly to approve N500 billion from the supplementary budget for the scheme. Also, Tinubu is lining up the controversial $800 million World Bank loan for the same purpose. He targets 12 million poor households which is a minuscule portion of Nigerians affected by the subsidy removal.

When the government of former President Muhammadu Buhari embarked on a similar quixotic venture, we cautioned against it. Government officials were unable to provide fool-proof criteria for cash disbursements. Besides, there were allegations of partisanship and sectional discrimination.

We have no credible social security register that accommodates the 140 million multi-dimensionally poor Nigerians. Any scheme that will take care of only a small segment of the poor and only for six months is unacceptable. Such cash in the hands of politicians or bureaucrats at this point so soon after the elections will definitely not be “safe”.

We prefer the strategy of “teaching the people how to fish, rather than giving them fish” when it comes to social welfare schemes. It is best to invest such funds in production, not consumption. Subsidising productive activities will create wealth and eventually benefit most Nigerians.