Analysts have raised concerns over the Nigerian government’s plan to allocate N5.25 trillion for palliatives, deeming it unsustainable and detrimental to the country’s fiscal health.
The proposed spending, aimed at alleviating economic hardships post-fuel subsidy removal, is criticised for its potential to exacerbate Nigeria’s already precarious financial situation. Experts argue that such massive allocations divert essential funds from critical sectors, thereby worsening poverty and inflation rates, which recently surged to 33.95 per cent.
The lack of effective distribution mechanisms further undermines the intended benefits of these palliatives
Recall that the minister of Humanitarian Affairs and Poverty Reduction, Prof. Nentawe Yilwatda, announced that the fund would be distributed to the ‘poorest of the poor’ Nigerians.
Yilwatda said the ministry would deploy the programme across the 36 states, targeting the registration of up to 18.1 million Nigerian households through the National Identity Number (NIN) system.
Commenting on this, chief executive officer of Economic Associates, Dr Ayo Teriba, warned that the plan was unsustainable as it could worsen the country’s fiscal condition.
“The government should seek ingenious ways and sell some state assets to buffer the country’s foreign reserves to strengthen the value of the Naira.
“This will enhance citizen’s real income and improve the living standard of the generality of the people without issuing them palliative,” Teriba said.
He urged the federal government to further stabilise the Naira to reduce poverty among citizens.
He said this following the government’s plan to ameliorate citizen’s economic situation by distributing N75,000 to 70 million families.
Also, former director, National Association of Small and Medium Enterprises (NASME), Nerus Ekezie, urged the government to encourage more people to embrace entrepreneurship and fund them to enhance their economic status.
Ekezie said this was a more reliable approach to tackling economic hardship and improving the welfare of citizens.
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