The slogan called poverty alleviation has become an enjoyable way by which the people in the corridor of power employ in misleading the downtrodden masses of this country. There are no evidences of its reduction but a mane ting in the official circles by the very forces that perpetuate the scourge.
All the organisations set up by every successive government to work out a method of its reduction (they say it cannot be completely eradicated) prefer to operate mutually exclusive two systems.
Despite the wisdom in complementing each other they would rather create small enclaves that are easily weakened by the usually hostile economic environment and unsteady fiscal policies.
What else, the airwaves and the print media for the indigent are awash with self adulating chief executives mouthing the billions of naira “given” out as credits when nobody has any reference proof of the claimed successes. Still the affected indigent people remain consistently united in their abject poverty of homelessness, ill health, hunger and illiteracy. No access to credit facilities and their hallmark is destitution.
Apart from confusion at home the international monetary agencies, indirect providers of funds have very serious reservations on Nigeria. Poverty alleviation programmes.
Not long ago, the World Bank confirmed the inability of government bureaucracy to confront fundamental economic problems because as it found out, bureaucrats typically perform poorly in business not because they are incompetent (they aren’t) but because they face contradictory goals and perverse incentives that can distract and discourage even very able and dedicated public servants”.
Although this is a rather flattering comment given what obtains in Nigeria in the recent past, these agencies should by now recognise that in an economic environment of commercialisation and privatisation of the present democratic government it is unreasonable to origin to pump scarce resources to fund programmes that the people themselves can do better. The basic requirements are the right policies and conducive atmosphere for co-operative grassroots development programmes.
The agencies that are regularly paraded by government as tackling poverty related issues in Nigeria are best non profit making government imposed business enterprise serving as political place-to. They are deceptive and at the same time destructive.
The multi-billion naira Family Economic Advancement Programme founded by the immediate past Heads of State leads the pack. Others are National Directorate of Employment, Community Bank for Commerce and Industry, Peoples Bank of Nigeria and Family Support Programme, of all these projects, only the Community Banks and the Peoples Bank can be said to really stand any chances of making meaningful contributions to poverty alleviation. Of course, the two would require very radical changes to perform the expected role sustainable grassroots financial intermediaries.
The Peoples Bank and the Community Banks are the only two organisations that the poor can reasonably relate to as of today. It is misnomer for the government to allow its major poverty reduction agencies to rely exclusively on the commercial banks that have never really cared about what becomes of the millions of poor folks in Nigeria. After more than one century of banking in Nigeria, why have the rural communities become desolate of its human, financial and natural resources? The answer is simple the big banks have continued to be exploitative and uncaring.
It is a fact that it is not viable for them to remain in the rustic environment due to their overhead costs. In spite of this reality and the wisdom in embracing the principles of comparatives advantage which would have allowed the smaller banks more elbow room to operate at the grassroots level, the “God Fathers” like to oppress them. These days the unit community banks. Thanks to the present administration for reconstituting the Peoples Bank after nearly two decades as a micro finance institution.
As for the Community bank it has also been reconstituted as micro finance institutions, but all in paper work because the same Central Bank cannot bring about an appropriate legislation to help the banks perform better at the moral level. Also government policies continue to see these unit banks in the would of commercial banks. The conditions being imposed on them to recapitalise up to N5 million may be counterproductive particularly for the rustic small banks. Presumably, a better way to handle the matter is having at least two classification for those in the urban and rustic areas.
For these fundamental facts, therefore, programmes dedicated towards assisting to the poor should not be hijacked and implemented by free market bankers and bureaucrats. Government Fiscal policies for poverty alleviation should be directed through the existing and poverty-friendly organisations (Community Banks and Peoples Bank for examples). Programmes officers must be ready to work with the poor in their local environment and not from the big cities as visitors.
Credit “giving and accepting” is what the government through the Family Economic Advancement Programme and even Peoples Bank are presently encouraging. Micro-Credit administration is a serious business and should not be trivialised as we see wives of political appointees “distributing” credits on the television. Have you ever seen any Commercial Bank waste money to organise a ceremony to give loans and advances to its customers? The way government agencies are doing it would continue to push the cost of administration.
A study of all the government agencies currently involved in micro-credit, shows, an average of 20 per cent of the funding received expended on the core essence of credit delivery while about 80 per cent is expended on overheads. The government should put in place throughout the current restructuring a system that ensures a minimum of 60 – 70 per cent on credits.
While only about 5-40 per cent would go for administration. With a well co-ordinated involvement of the people over a period of five years, a further reduction to 10 per cent costs to government should be possible.
The government cannot eradicate poverty by pumping money into the already bloated bureaucracy rather it should concentrate on creating an enabling environment for entrepreneurship to flourish at all level of the society. Indeed, if government can provide the basic infrastructures needed for good life: promote higher literacy levels, guarantee better access to medicare, ensure security to life and property and ensure that democracy takes firm root in the country, then the efforts in alleviating poverty would have meaning.
Here I will like to appeal to the media houses that rather than encourage public relations promotional exposures of the operators of these agencies, it may be more advantageous to pay more attention to the programme implementations it impacts on the poor.
The challenge for the media is to get involved in finding solution to the devastating effect of poverty through research and indepth analysis of issues and not necessarily the well won patronising statements being made by government functionaries of poverty alleviation.
In doing this, the media would be helping to expedite the transformation of Nigeria from ironical status of a country that has so much wealth but cannot feed itself.
Finally, the government should courageously carry out some mergers thereby eliminating wastes and bureaucracy. The Peoples Bank and Community Banks can be administered together to make poverty alleviation a credible and efficient programme that the poor can work with. Family Economic Advancement Programme, Small and Medium Enterprises, Directorate of Employment will do better if they are merged and refocused to cater to the needs of the rapidly disappearing middle class by helping them to establish cottage industries.
Of course, the Nigeria Agricultural Co-operative Bank and the Bank for Commerce and Industry may be reorganised for greater efficiency. The role of government is required to ensure adequate funding and suitable legislation that would make each of the emergent organisations strong enough to achieve their mandates. These organizations should be sustained and steered clear of political interferences to ensure professionalism, focused implementation of objectives and better service to the millions of Nigerian poors where ever they may be.
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