Recently, governor AbdulFattah Ahmed took tile to answer questions from newsmen during the monthly ‘The Governor Explains” programme which he uses to interact with the media and general audience from outside. in this excerpt the governor explained why his administration has taken certain policy steps on budgeting, road rehabilitation and infrastructure development. He ended the session with a promise that even though he still needs about N5 billion to do it, the water project for Ilorin Metropolis would be completed this year and residents will begin to enjoy regular supply. Biodun Oyeleye recorded the session.
What is your assessment of the 2012 budget for the state?
When we started the administration in 2011, we promoted the concept of continuity of legacies. What did we refer to as continuity of legacies? What were we expecting people to see in the continuity of legacies? We looked at it from the angle that we have just come out of an administration that had driven governance under clearly spelt- out policies. It would only make sense for people to begin to see benefits of some of the programmes that were carried on from last administration to this administration. We needed to ensure that there is benefit to the people in terms of completion of projects to fruition level. Hence, the first thing we did was we took on projects that were on-going. We wanted to be sure that these legacies that were promoted in the last administration were taken to finishing levels. For example, at the time we were trying to develop our budget we did not see our self developing a budget for 2011, 2012 or 2013. Wecame up with a Medium Term Sector Strategy; that is, budgeting that spans a period of 4 years. And we began to isolate each year’s budget as a module to be executed so that people will begin to see the benefits of continuity.
So every year’s budget moves into the next year’s budget in terms of implementation. You see, budget in figures does not make meaning to the people. What should make meaning to them is the impact of the budget. For instance, when we came in we had quite a number of projects that were on-going. A typical one was the Aviation College. The structures had just been completed when we came in. We needed to ensure that every other area that was needed to make it a functional school was taken care of and we diligently pursued that by injecting money. I am happy to tell you that our students are already flying. It is one of the very few aviation training institutions in Africa today. Our people might not feel the direct impact yet. We will begin to see the impact of this school when we attain economy of scale with additional aircraft.Federal Government, through the Vice President, is willing to support Kwara State Government in this regard. Insha Allah, within the next two or three months we will be getting additional 10 to 15 aircraft that the school needs to expand to the level where we will begin to feel the economic impact directly in the State.
We also have the International Diagnostic Centre. We met it at the level when it was almost completed and we had to take it to the level where people will begin to benefit from it. I am happy to let you know that we have since completed that programme. It has been commissioned by the Vice President, Alhaji Namadi Sambo and will become functional from next week. In order words, Kwara State is going to warehouse the first Internationally-recognised Diagnostic Centre. Proper diagnosis has been the bane of healthcare delivery in Nigeria today. Quite a number of people have lost their lives because the ailments have not been properly diagnosed. So no matter how perfect or advanced our doctors are in terms of knowledge without accurate diagnosis, it will not get to desired results.
We have a thousand and one roads which we have commissioned. The Ahmadu Bello Way, MurtalaMuhammed Way; we have other roads across the three senatorial districts which were started by the previous administration but were completed by us. This is part of what we call Shared Prosperity. This has also impacted in the area of education. We’ve added a lot more classrooms, both at the basic levels and at the Senior Secondary School levels. We’ve since started the Ajase-Ipo International Vocational Centre which will be an International institution that will train our youths to be entrepreneurs and become people that are employable and can generate employment themselves. These are all parts of what we are carrying out under Shared Prosperity driven by continuity. Of course, you can see the CDC laying the pipe for water here. In addition, there are 14 water works currently being rehabilitated. We have sunk over 220 boreholes. We’ve made electricity available to over 179 communities. These are all benefits of Shared Prosperity; all driven under policies that are fitting into the medium term sector strategy.
Can you explain why the recurrent expenditure is higher than the capital expenditure in the 2013 budget?
It is a Nigerian factor. It is a structural problem in the country. We have allowed government to grow to the level that it is being run with a substantial part of the budget which ordinarily should be used for capital projects for the people. There is no hard and fast rule to it. If you take a typical state like Kwara State that is largely a civil service driven environment, what we have is a plethora of workers that we inherited in current civil service. Go to the federal level, go to local government level you will see what the government is experiencing. Unless there are deliberate efforts by governments to begin to create a structural change which will not allow for further growth of the civil service, the situation will remain the same.
I saw a lot of criticism coming out in the papers. I just laughed. If you don’t give it a holistic approach you will not understand how these things are done. A typical State like Kwara State that is civil service driven where the major sources of Internally Generated Revenue are largely supported by the Pay As You Earn (PAYE). Other areas where we need to get revenue from are hugely untapped because we need to inject more money there to bring them to taxable levels. A typical one is the issue of land. I kept saying that land is one source of income for any government anywhere in the world.If you add value to that land you could make money from it and our attempt to do this has been largely misconstrued by those who see government as trying to take over land from the traditional owners. We are not taking land from traditional owners. We are trying to improve on lands so that the land use becomes meaningful and government can earn money from the use of that land, largely from values that have been added. That was what gave birth to the new GRA (Government Reservation Area) which people didn’t understand very well. We also try to see how we can create additional taxable environment which will not only generate employment for our people but would also drive the economic environment. A typical one is Shoprite. We brought Shoprite here. It has become a major employer of labour and a major driver of the local economy. The success of Shoprite will now see us bringing additional people who will create more jobs for our people.
Look at the Amusement Park which has been touted as the old Yidi that has been sold. It is unfortunate. I don’t know why it is being referred to as the old Yidi because it is insulting to the intelligence of Islam to refer to that place as Yidi. Why? After it was used as a Yidi it was used as an Amusement Park where alcohol was sold. Parties were carried out and nobody saw it as an Eid ground at that time. Now that we have decided to add value to it to generate employment for our people to allow economic activities to thrive people are beginning to say it is old Yidi which is now been sold to an investor. If we are truly sensitive about the issue of religion then we should have kicked against the sale of alcohol at that time. Let us face the reality that the challenges we face today are unemployment, low economic activities and over dependence on government. And we need to move away from there. Government should be given a chance to positively change the lives of our people. We have given a commitment.
What we are doing is that we want to try our best to improve on the environment so that people can begin to benefit from there. The Amusement Park has been there for a long time; nothing was coming out of it. We need to create employment for our youths. We need to generate economic activities and that is why we are inviting investors. If anybody, either Kwarans, Europeans, Indian has proper investment visibility studies to drive that place into a useable level where our people can benefit from it, bring it we will look at it and then we will support it because what is most important to us is the employment generation for our youths and the economic activities which will continue to guarantee peace and tranquillity in the environment.
So the recurrent expenditure that you see that is high is largely because we need to continue to sustain government the way it is because what is the component of recurrent expenditure? It is largely overhead and personnel. All other areas are just small areas of driving government business. If we say we want to shrink it, the implication is that we want to reduce the work force because other taxation environments are still very small compared to what we can generate to augment the allocation that is coming from the federal government. So by and large, government will continue this way but we will ensure that we do not increase our recurrent expenditure, especially in overhead and personnel so that a lot more monies would be saved in future to drive capital expenditure.
One way by which you see that capital expenditure is bigger than recurrent expenditure is when you engage in borrowings.Borrowings, itself, is not done out of the blues. You must look at your capabilities to borrow, utilize and pay back. And we are approaching our borrowing through a strategic funding model. In other words, we don’t want to burden government through constant borrowing because the only way to develop is to constantly borrow money when your money is recurrently flowing in that will allow you to be paying gradually and you have access to large sums of money you can carry on capital projects with.
For instance, you look at last year; we were doing 5 General Hospitals at the cost of over N2billion. Ordinarily, we could not have got that money from the normal allocation that comes to the State. We needed to borrow money. We now begin to pay back that over N2billion gradually to the banks that lent us this money and in the process we are carrying on renovation of the 5 General Hospitals. Don’t forget that this also extends to areas of water, education, agriculture and, ofcourse, security. These are areas we must carry on and the only way we can do that is to continue to rely on the money market and capital market, but we don’t want to over stretch ourselves in such a way that it would begin to impact on our capacity to drive our recurrent expenditure. So, recurrent expenditure as it were, will continue like this for a while until when we begin to introduce electronic drive into the running of government. Government as it is today, with the number of the civil service we can’t begin to retrench people, but we must carry them on until we begin to stop growing government by not replacing people that are retiring, but rather moving towards electronic drive. What the opposition is seeing is just one side of the picture. They are not looking at the other side. You can’t look in absolute terms and say your recurrent expenditure is higher than your capital expenditure. What is the component of your recurrent expenditure that is making it high? It is largely overhead and personnel.
How do you plan to ensure Kwara State reduces its dependence on federal allocation?
Our dependence on federal allocation is largely borne out of very low capacity to generate your own revenue. Ordinarily the federal allocation should have been icing on the cake, but the reverse is the case. We have been heavily depending on the Pay as You Earn to augment our recurrent expenditure, to augment our Internally Generated Revenue. Our commercial agriculture is designed to generate what you call a value chain concept which will see people making money from agriculture away from the subsistent level we used to know. This in itself would generate and drive taxable environment. Revenue comes from taxes, fees, fines, commissions and royalties. Out of all these ones apart from taxes which make up of close to eighty percent of what we earn in internally generated revenue, our fees are very small, our commissions are small and of course fines are small because of lack of compliance.
And we don’t want to put much pressure on a very low economic environment. To that extent, we have a responsibility as a government to continue to inject some money into driving economic activities that would become taxable. If you want to have an environment where you can raise money, you must first inject money there, convert into an environment that can generate revenue. For instance, we have injected money into Shoprite. Shoprite would now become a taxable environment. So that is how you create taxes in the system. But you see that same money you require to do capital project would first of all be injected into generating taxable environment.
We need to grow commercial agriculture, we need to get money to generate activities that would become taxable. So on policy terms, the state has already embarked on these programmes and we are at the implementation levels where we will begin to create taxable environment. The real impact would not be felt until after about two to three years because part of the incentives you give to prospective investors is tax holidays. What would make the place attractive to them, to come spend their money, grow the business then we begin to tax them. So these are some of the strategies that the state is embarking upon to ensure those we move from our heavy dependence on the federal allocation to our own internally generated revenue where more monies would be coming in and the more the monies comes in, the more monies are available for development in terms of roads, energy, education, health, for security and other areas.
Sometimes ago you promised to intervene on the Ajasse-Ipo-Erin-Ile Road despite the fact that it is a federal government road. Can you give an update?
Yes, there were two forms of intervention we had in mind. The last time the Minister of Works came to Kwara, we spoke at length on our federal roads and how as the state we are willing to look for money to execute these roads on behalf of federal government subject to the fact that the federal government would pay us back our money as we carry on the projects. We wanted to reach that agreement. Unfortunately, the federal government has not given a concrete answer on that. Rather, what they have told us is that there is a policy in place which would allow states to carry on federal roads and get paid back. Then we asked them to give us the guideline.
They gave us the guidelines regarding Kaiama-Kisi road and they gave us some guidelines on how to engage contractors, bidding process and getting to the levels of award.We have other federal roads in the State. If we can get a nod to embark on these roads today, I would access money and start rehabilitation immediately. But don’t forget that the money would be borrowed. Unless I get assurance that I would be paid within a specific time frame, it would be dangerous for me to go and borrow money that I don’t have a source of repayment to execute roads.
The second is that if the federal government is not responding to us as we require, we will on our own embark on the rehabilitation of that road and I think we are taking a combination of the two options. I recall that I went to Offa some time last year and I emphatically said that we as a state will take over the rehabilitation of the road. I meant what I was saying. In order words, we are not going to wait for the federal government. Offa-Erin-Ile road is something that we will try in the year’s budget to rehabilitate. I know it is around N600m to get it to a desired level. Kaiama-Kisi is going to take a minimum of N6 to N8billion to take it to completion and of course Omu-Aran-Kabba. I don’t think that would take less than N8 to N10b and of course Jebba to Eiyenkorin cannot take less than N4 to N5billion. You see all these are more than our monthly allocations. But as it were, am trying to get into a new funding strategic arrangement that would allow me to continue some of these programmes.
Some political watchers in the country saw it as baffling when the Nigeria Labour Congress recently listed Kwara State as one of the States yet to comply with the minimum wage. What’s your government’s position on this?
It was unfortunate that the NLC did not have its data correctly. That is what I will just say. If anything, Kwara State, is one of the first states that implemented the N18,000 minimum wage with workers, especially coming in from the 33rd position on the federation allocation table. We still came out as one of the first states to implement minimum wage. So Kwara State being listed is very unfortunate. It shows that the Nigerian Labour Congress is not doing its job with data collection and ensuring that it has the right information. Rather, we should be given kudos for been able to implement the N18,000 minimum wage.
There are some stakeholders who argue that the government is concentrating infrastructure development in Ilorin to the detriment of other parts of the state. What is your reaction to this?
I will completely disagree with that. Firstly, let us look at our policies. The reason why we try to drive government business with policies is to be able to isolate the impact that people should feel. Now, look at our roads. We have spent over N2.7bn on rural roads. Not up to 10 percent located in Ilorin metropolis. All these roads are located in the three senatorial districts, largely in the villages and other communities. The essence of it is for our people at these levels to begin to feel the impact of government. When we renovated schools where we renovated up to like 400 schools not up to 10 percent are within the metropolis. They are scattered across the three senatorial districts. We are renovating five General Hospitals, only one is located in Ilorin. We have two in Kwara South and one in Kwara North (senatorial districts). If you keep going you will see that a lot more activities are spreading to other parts of the State.
What they are seeing as concentration is completion of on-going projects. We have not started anything new in Ilorin but we are seeing the projects we met to completion. It does not make sense that I abandon Ahmadu Bello Way and go and start another road somewhere. It doesn’t make sense that I abandon the Murtala Mohammed Way and start another road somewhere. Monies have been spent on that road. Our people should enjoy the benefits of that road when it is seen to completion. That is why everything you see us doing in the metropolis today is largely completion. Look at the water project, it is a continuation. We need to see it to completion. Whatever has been spent there will give us the desired level when we complete and people will begin to benefit. That is the essence of continuity. Don’t forget that we have worked under a structured methodological designed Medium Team Sector Strategy frame work which ensured that we are not only carrying work to completion but generating new projects driven by the same policy. If this policy is continued for 3,4,5 generations of Governors you will begin to see real development and growth in Kwara State and people will have hope and their hope will be anchored on the desire to see that government must be given time to complete everything it does because life itself is anchored on hope. When there is a will there is a way. And that is why we must get things to completion.
There is the problem of water supply in Jebba. Work commenced on water supply repairs during Governor Sha’aba’s tenure but nothing much is happening now. Why?
You see the issue of water is a continuous problem not because of anything but because the population is growing. Government is always faced with the responsibility of continuously requiring to expand on its support of infrastructure. It is not only water, even electricity, road, hospital because the population is growing. As for Jebba, we will look at the shortage of water supply and I will ensure that within the next few hours a response goes to find out what their major challenges are. If the challenges are that of surface water, we have a programme that is already going on for rehabilitation of surface waters; i.e, dams and water works. If they are issues of boreholes we have a maintenance gang which is already going round. You see the beauty of this programme we are doing is for people to anchor hope on a system that is designed to run methodically. In other words, if you don’t get today, because there is a programme, it gives you hope that you will get it tomorrow.
Talking about water when will the people of Ilorin metropolis start enjoying uninterrupted water supply?
Insha Allah, this year. We will start getting it this year. We still have a long way to go in terms of funding requirement. We require not less than N5billion to carry out the project to the desired level. Places where the pipe reticulation is completed will begin to enjoy and it is going to be on continuous basis. Don’t forget that we are also confronted with the problem of electricity. Sometimes the problem of water is not because there is no water but because of electricity.