Rotimi Amaechi & the resources of River State:
A score card
By Eze Chukwuemeka Eze
 |
| River State governor |
The main treatise of this
attempt for avoidance of doubt is to examine and x-ray how Gov Chibuike Rotimi
Amaechi of Rivers State has diligently and prudently managed the resources of
Rivers State or otherwise.
This becomes imperative considering the Punch
Newspaper publication in its edition of 4th August, 2012 where the frightening
financial status detailing the external high indebtedness of most of the States
in Nigeria and the
heart-warming stand of Rivers
State coupled with the
pressure from some cynics that Amaechi is not doing much in lieu with the
resources at his disposal.
According
to States and Federal Government’s external debt stock obtained by SATURDAY
PUNCH of 4th August, 2012 from the Debt Management Office, Lagos, Kaduna, Cross
River, Ogun and Oyo occupied the top position on the list of external debts
incurred by State governments as of June 30, 2012 Borno, Delta, Plateau, Taraba
and Anambra states had the lowest external debts.
Lagos topped the list of
external debtors with $517,677,672 as of June 30, 2012. Next to Lagos is Kaduna
with $197,155.525, Cross River has $109,351,503 external debt. Ogun State
is the fourth most indebted state with $96,285.547 as of June 30, 2012. Oyo’s
external debt (the fifth) was $78,878,401 as of June 30, 2012,
SATURDAY
PUNCH investigations showed that the present administrations in Ogun and Oyo
inherited the foreign debts from their predecessors. States, whose external
debts are low, include Borno ($12,726,028); Delta ($15,785,110); Plateau
($20,190,627); Taraba ($20,681,527) and Anambra ($25,370,842). However, while
other four states depend on federal allocations, Lagos generates huge internal revenue, which
was about N23bn monthly in the first quarter of the year.
At
the zonal level, South-West leads the external debtors with $840,913,596,
followed by the North-West, $473,305,365; South-South, $289,952,619;
North-Central, $189,192,241 and North-East, $186,303, 921.
External
debts of other states, apart from the 10 mentioned above are: Abia,
$32,675,171; Adamawa, $29,183,118; Akwa Ibom, $61,198,851; Bauchi, $63,029,387;
Bayelsa, $27,897,951; Benue, $26,501,393 and Ebonyi $41,060,946.
Edo State’s
foreign debt is $41,408,440; Ekiti, $34,071,754; Enugu,
$47, 788,769; Gombe, $29,572,867; Imo, $50,573,894; Jigawa, $28,720,760; Kano, $59,400,227;
Katsina, $74,147,092 and Kebbi, $47,132,689.
Kogi State
owes $33,976,282; Kwara, $43,798,143; Nasarawa, $36, 547,616; Niger,
$28,178,180; Ondo, $52,255,534; Osun, $61,744,688; Rivers, $34,301,764; and
Sokoto, $40,419,413. Others are Yobe State, $31,111,004; Zamfara, $26,329,259 and the Federal Capital Territory,
$37,671,245.
On
Rivers, the State Commissioner for Finance, Dr. Peterside Chamberlain,
explained that the current administration had borrowed N30bn in October 2010,
an amount that was paid off in September 2011 and that another loan of N20bn
was accessed in July 2011 from Guaranty Trust Bank and Zenith Bank and noted
that a substantial part of the loan from Zenith Bank had already been paid
back. The commissioner further pointed out that the funds were used to finance
the state’s ongoing electricity project, which would be completed by December
2012.
To
demonstrate the seriousness of Gov. Amaechi careful management of the resources of
Rivers State, he immediately on assuming office in 2007 constituted his Cabinet
with men and women of integrity and seeing the decay in infrastructure in the
State commenced his task by initiating and signing into law, Road Maintenance
and Rehabilitation Agency Bill No. 3 of 2008, Sustainable Development Amendment
Bill No. 1 of 2008, procurement public bill, Saving Public Fund Bill and even a
bill excluding the office of the Governor from signing and awarding of
contracts. The fact remains that no other State in Nigeria has such laws in operation
excluding the Governor from interfering and awarding of contracts and saving
part of its revenue for the rainy days. With the enactment of these bills, the
Governor demonstrated early enough the type of governance he intends to
bequeath to the State – Governance premised on Accountability, service
delivery, people orientated government for the greater good of Rivers people.
According
to Rt. Hon. Amaechi, ‘in order to lay a strong foundation for positive change in
governance in the State, the administration has taken it upon itself to
initiate very critical bills on fiscal responsibility to the State House of
Assembly and virtually all of which have been passed into law and assented to
by me. The Executive arm of government so far has credit for having at least 60
per cent of all bills passed by the House of Assembly, saying that virtually
all the bills were designed to deal with the age long problem of financial
irresponsibility and rascality and as far as the existing laws on fiscal
responsibility are concerned, anyone in government who tries to have an over
sight of the due process mechanism in the State would surely run into problems’
Apart
from initiating critical bills for the economic revolution in the State, the
Governor inaugurated a high powered Economic Advisory comprising of the best
brains in Rivers State the includes Prof Nimi Briggs as Chairman with Prof Tam
David West, Engr. Tonye Princewill, Barr Ledum Mitee, Dr Chamberlain Peterside amongst others as members.
Speaking while inaugurating the Council, Gov Amaechi said the task before the
high-powered team was to make recommendations that would attract new investors
and make old ones more profitable. The governor said the responsibility
of the State government was to abide by the blue print for economic development
of the state because government alone cannot be the sole producer of funds and
employment. He noted that the present security challenges in the Niger Delta
cannot be an excuse for mass poverty in the state. He explained that the
present economic position of Rivers
State was worrisome
because a lot of companies have down-sized their operations while others have
closed down completely.
In
the same vein, the Governor set up a committee headed by the Deputy Governor,
Engr. Tele Ikuru and made up of members of the Nigerian Society of Engineers,
Quantity Surveyors, Urban and Regional Planners, Architects, amongst others, to
produce a blue print for the infrastructural development of Port Harcourt. According to him, “we
are determined to confront the challenges of infrastructural development in the
state, but while you make suggestions in that respect, it is not the primary
assignment of the Economic Advisory Council because your task is to look at the
micro and macro indices of economic growth bearing in mind our limitations as a
state government”.
The
State Chief Executive hinted that the State cannot affect the price and value
of the dollar but can codify taxes payable in the State and utilize that to
ensure that investors have a clear picture of business opportunities that
abound in the area.
He
promised to introduce fair reaching objectives and workable formula that would
entice banks to support the indigenous businessmen and women by conceptualizing
policies that could reduce poverty in the state.
The
Governor hinted that the members of the economic council were chosen strictly
on merit, as no consideration was given to where the person comes, adding that
the challenges of the assignment which is remuneration free, was enormous but
God has given the state competent, knowledgeable and capable persons.
Prof
Briggs the Chairman of the Economic Team assured that they would examine the
issues seriously and proffer solutions that would assist the State move forward
while congratulating the Governor for the decision to find solution to the
economic problems in the State.
Apart
from the above, Rt. Hon. Chibuike Amaechi set up an agency called Bureau on
Public Procurement alias ‘Due Process’ with the highly respected Barr Franklyn
A. Nierum as its Director General. This is a man who due to his sterling and
uncompromising attitude to corruption is hated by many of the government
officials and contractors who see him as an enemy of the system but most
certainly loved by Gov. Amaechi who sees in him the key to stopping corrupt
practices in the State. This Commission is to monitor projects, ensure proper
valuation and costing of contract in line with the market value thereby
reducing corruption and inflation in the system and ensuring that credible and
capable contractors execute government projects in the State.
That
notwithstanding, the key to prudent management of our public fund lies in the
hands of the type of Officials Amaechi appointed to handle the Finance and
Budget Planning Ministries in the State.
The
appointment of this unassuming and silent revolutionist, Mr. Levi Gogo Charles
to head the Ministry of Budget Planning was a most welcome development in this
regard. This young and vibrant man has instilled probity and financial
discipline in the system that some of us in the Re-Election Campaign Team of
the Governor saw him as the obstacle why funds were not properly released to
the Team to execute its task because of his very stingy, strict sense in the
disbursement of public funds and was nearly lynched in one occasion but the
then Director General of the CRA Campaign Team, Chief Barr Nyesom Wike the
proponent of Anaya-Neli and now the State Minister of Education prevailed and
authorised immediate release of funds for the execution of the then pending
issue..
To
Nigeria, the key to its
financial challenges is Mrs Ngozi Okonja-Iweala but to Rivers State
its own key to prudent management of public fund is Dr Chamberlain Peterside.
For avoidance of doubt, Chamberlain, a renowned world financial columnist was
the Founder & President of New Era Capital Corp. MyCompletefinance.com, a New York based financial
services group. He was previously a Financial Advisor in the Global Private
Client Group of Merrill Lynch. Chamberlain whose background is both diverse and
in-depth holds a Ph.D degree in Economics/Finance from a University in Europe. His company is based in Moscow
and London and is involved in conducting
marketing research and financial analysis for foreign companies focused on the
new markets of Former
Soviet Republics.
After a stint in Wall Street in Global Wealth Management, he launched his
latest enterprise, which seeks to capitalize on the power of technology to
deliver high quality and efficient financial solutions. How Amaechi succeeded
to convince this world renowned economist who has lived most of his life in America to head
the Ministry of Finance as a Commissioner is still a wonder to most of us.
According
to this genius and a gift from God to the people of Rivers State,
the State was able to generate internal revenue of N36B through IGR as at July,
2012 while the saving from the monthly compulsory levy is now N34B. “The policy
thrust of the present leadership of Rivers
State under the watch of
Rt. Hon. Chibuike Rotimi Amaechi is to maintain a robust public financial
management structure that could bring about efficiency and effectiveness. The
position of government on prudent management and accountability were
responsible for the successful execution of various ongoing projects in the
State and the administrative policy of instilling financial discipline is
appropriate and timely”
Explaining
his plans for Rivers State Economy, Dr Peterside disclosed to me that his
mandate was to help sustain the development, projects and the investments that
the governor was working on. He said, “I do have a work plan. We have a series
of initiatives to put together, which I have shared with his Excellency and
which he fully supports. “One of the several aspects of our work plan is to
reposition the internal Revenue Board to be able to grow our Internal Generated
Revenue (IGR), the other is developing human capital in the finance ministry
and bringing about high level of efficiency in resource allocation and as much
as possible diversifying from and reducing our dependence and reliance on
federal allocations in our investment programmes. You would not ultimately move
away from federal allocations totally, but we believe that over the next one
year and beyond we should be able to get at least 50 percent of our total
revenue from internal sources, which is from IGR. Right now we are getting
about 15 to 20 percent of our total revenue from internal sources”.
Rivers State has a potential tax
base, we have companies that are operating here, we have a huge market in the
hospitality space, we have a lot of employees that are based here, working here
but sometimes their taxes are accounted for in other jurisdiction, we want to
be able to capture some of them. So the approach is multi-dimensional, “he
said.
Another
part of his plan is to seek avenues to increase revenues from existing sources,
making proper use of the recently launched Rivers State Geographical
Information System (RIVGIS), which he described as a system that would help
automate and hasten the issuance of C of Os.
He
also gave the assurance that foreign investors would be drawn to Rivers State
in his time as Commissioner for Finance. According to him, it had to do with
creating an enabling environment coupled with a clear demonstration of the
State’s appreciation of investment, commitment and openness to ideas as being
exemplified by the state chief executive.
For
three years now, the Rivers
State government has
worked hard to automate and digitalize its revenue collection and management
operations, hoping to make internally generated revenue (IGR) the backbone of
its revenue base. This dream was realized with the commissioning of an optic
fibre-based Tax Management Software (TMS) under the watch of this wizardry of
Dr. Peterside.
The
state government was elated that the task of a target of up to N10 billion from
IGR every month would be realizable. By 1999 when democratic rule returned to Nigeria, the
then new administration led by Peter Odili met a mere N250million per month as
IGR.
The
governor worked assiduously to up this to about N2.5billion on the average. The
current governor, Chibuike Rotimi Amaechi has moved this to as high as
N5billion in December 2011, though the year's average was put at N2.6 trillion,
according to governor's account to the people via the 2012 budget presentation.
The determination to realize high IGR target of about N10billion monthly seems
to inform his choice of finance commissioners..
The
Special Adviser to Governor Amaechi on Internal Revenue Generation, Nwankwo Nwankwo,
said; "This singular project will change the face of revenue drive and tax
management in this oil-rich state. The Governor gave a free hand to the board
and gave huge support to us. Skye Bank's energetic drive and the resources they
have put into this project to bring us to where we are today are
commendable." Now, a tax-payer could log on to the Board of Internal
Revenue (BIR) website, carry out self assessment, pay online, and print out a
receipt. Government officials think this would almost eliminate human
interference in tax payments and remittances.
The
Finance Commissioner, Chamberlain further said efforts were made to sustain the
transition so that at no time should the state return to the analogue method
and human collection of taxes. Lending his view, Alaliba Dokubo, Chairman, BIR
expressed great joy, saying the board was proud of the automation and
digitalization of its operations. She said Governor Amaechi was indeed an
innovative Chief Executive whose determination for modernity was unequalled.
The Nigerian Joint Tax Board (JTB) ICT Programme Advisor, Oduba Oduba, in his
view, said Rivers
State had moved far ahead
of most other states in upgrading to TMS, saying BIR would now easily interface
with the JTB.
With
the reduction of the monthly revenue of the government from N18 billion to N13
billion despite the fact that the wage bill is rising coupled with the plan by
the state to employ 13,000 teachers which would further increase the state’s
monthly wage bill; the need for the State to improve on its Internal Generation
Revenue becomes imperative. In this regard, the Governor has emphasised
seriously that the government would soon embark on intensive revenue drive by
going from house to house to collect taxes from the people. Amaechi said government
would be better off if it could receive the N18 billion monthly and urged the
residents to pay for services rendered them.
The
efforts of another genius in Amaechi’s administration, Barr Chuma Chinny the
Commissioner of Commerce and Industry who has organised Summit and have most of
the Companies and Business interests in the State registered to ensure that
they pay their taxes accordingly and promptly coupled with the position of the
Fitch Rating comes into play if applied judiciously. According to Fitch Ratings
revised Rivers State Rating Outlook to Positive from Stable on 2 December 2011
has subdued restiveness and supports oil production, thereby offsetting rising
financial debt. With the eventual removal of the fuel subsidy, it could further
boost oil revenues but Rivers is committed to developing internally generated
revenues (IGRs). A 3% social services levy, and re-directing companies to pay
taxes in Rivers, instead of where they have headquarters, could push IGRs to
NGN10bn per month by 2014 from NGN4.5bn in 2010. Fitch expects the growth to be
more gradual and IGRs to eventually top NGN100bn in 2013, representing 30% of
Rivers' annual income, a substantial improvement from NGN30bn in 2009.
CONCLUSION
AND DEDUCTIONS
That
the administration of Governor Amaechi has embarked upon many projects
unprecedented in any other State in Nigeria that includes, setting up of the
Songhai Farms and the N20B Agric Scheme that will revolutionise agriculture in
the State, starting off of the billion Greater Port Harcourt city to decongest
the present Port Harcourt City and construction of one of the best stadia that
hosted the last Sports Festival in the new city. Building and equipping 180
health centres across the state, constructing many roads and schools, embarking
on a monorail first of its kind in Nigeria which the Governor has
promised the completion of the first two phases by 2014. Upon completion, the
monorail would transport 40,000 passengers daily.
Offer
of scholarships to over 2,000 students in Nigerian Higher Institutions and
spending of about N5bn for her students in foreign Intuitions. Building a world
Class University which when completed will
turn out well equipped graduates that will hold their own in any field and
compete with the best in the world. Building in Rivers State University of
Science and Technology a hostel that will accommodate about 6, 000 students and
accommodation for all the Lecturers of the university. The university will be
fully ICT compliant. It’s
important to point out here that the Rivers State Government is among the few
States in Nigeria that offer
free education and free health delivery to its people but stands apart as the
only State offering free education, free sandals, free books and free uniform
in Nigeria.
About 200 primaries schools have been set up in 200 communities, a feat that no
other state is yet to accomplish.
Under
Health; so far, about 100 medical Doctors have been employed to staff most of
the Health Centres in the rural areas. The Rivers State Government has
currently embarked upon the exercise to eradicate malaria vectors from the
State. The Health Centre at the Rivers State University of Science and
Technology will soon be opened to the public. The State was lauded last year
for its daily commissioning of a health centre over a 60 day period in 60
communities in its 60-60-60 initiative. The Dental
Hospital located in the Garrison area
of Port Harcourt
will soon be opened.
The
Rivers State Government has invested over N100b per year from 2008 till 2011 in
provision of roads, bridges and Social amenities. In this regard, the
Government has engaged in the construction of 800km roads with 250 already
completed. 10 major bridges under construction with 3 already completed. 20
minor bridges under construction with four completed, 2flyover/interchange
under construction. 6 Land reclamation/shore protection projects at Andoni,
Opobo, Buguma, Abalama, Olombie/Owukiri Island, Oba Ama, Okirika with
1,1400,000km 2 completed. 2 major markets and a shopping mall under
construction (phase 1 of mile 1 market housing 960 shops and two banking halls
completed). Apart from all these the Rivers State Government has built three
power stations built at Omoku (150 Mega watts), Trans-Amadi (130 Mega watts)
and Eleme (75 mega watts). By June, 2011, capacity will be increased to 500
Mega Watts under the $195 million dollars 180 MW gas turbine awarded to Saipem.
Seven Transmissions stations (132/33 kilo volts) and 7 Distribution injection
sub-stations 33/11 Kilo Volts built. The security and freedom the people of Rivers State
are now enjoying can only be appreciated if the scenario and state of Rivers State
before Gov Amaechi assumed office can still be remembered by our people.
It is on record that Rivers State
has again been affirmed a ‘B’ international rating by leading international
financial analysis agency, Standard and Poor’s (S & P) in a report released
recently. The long-term outlook for the state is revised upwards from last year
rating of "Stable" to "Positive" on the strength of
significant ongoing infrastructural investments (in roads, ICT, health care,
education and urban renewal) and relentless efforts to transform the public
finance framework. All this would help lift the state's social and economic
status in the long run. The agency in its 2010 credit analysis report on Rivers State,
noted that the state currently had a high credit quality, owing to its strong
cash holdings, low debt and a healthy operating balance. More importantly, the
state’s efforts towards modernising public sector administration, which
included information technology upgrade and an improved transparency and
accountability in administration is a plus to the administration. Standard and
poor’s also noted that Rivers has a strong liquidity base with no substantial
debt burden. According S
& P, as of July 2010, Rivers continued to enjoy a very comfortable
liquidity position. It had N43.9 billion in local currency and $11 million in
U.S. dollars. By this overview, cash holdings in the state at the end of 2010
should be at around N50 billion, based on Standard and Poor’s assumption of
N200 billion”.
In
appreciation of all these feats, the Rivers State Governor, Rt. Hon. Chibuike
Rotimi Amaechi has been conferred with the prestigious “SERA’s” award for his
contributions towards the social development of Rivers State,
in line with the objectives of the Millennium Development Goals (MDG),
especially in the areas of Health and Education.
While I know the
difficulty in managing public fund, Gov Amaechi has demonstrated a high level
of skill, integrity, probity in this regard. The numerous projects completed
and ongoing in the State is a clear indication that the Governor indeed
deserves encomiums from all and sundry rather than being vilified by some
people. He and his team certainly deserve kudos for prudently utilising the
public fund of our people wisely. To Malcolm X, “When you have a philosophy or
a gospel--I don't care whether it's a religious gospel, a political gospel, an
economic gospel or a social gospel--if it's not going to do something for you
and me right here and right now--to hell with that gospel.” One can state
unequivocally that Governor Amaechi has invested the resources of the people of
Rivers State wisely and judiciously and that
the Punch’s investigations stand on the State finances did not come to some of
us keen watchers of this administration as a surprise. To Amaechi and his Team,
kudos as history will surely be fair to you all.
Eze Chukwuemeka Eze is a
Media Consultant based in Port Harcourt
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