NWEKE EUGENE. N
Department of Political Science
Ebonyi State University,Abakaliki, Nigeria
Abstract
The introduction of wide range of poverty reduction policies at multiple levels became a major policy initiative by federal government since early 1980’s in a bid to alleviate poverty among the citizens. The utter dismay stemming from this despite so much strategies is the continues decline in the standard of living as good proportion of the citizens still-exist in absolute poverty. As a reaction against the inability of state—led strategies to reduce absolute poverty in Nigeria, this article explores the possibilities of collaborative partnership with organized-private sector. The first section examines the background to poverty in Nigeria. The second section of the article conceptualizes, poverty, state and organized-private sector. The third discusses the profile and state of poverty in Nigeria. The fourth section reviews some state poverty reduction strategies till date, the fifth explores prospect of state –organized private sector partnership in poverty reduction while the sixth concludes.
INTRODUCTION
Poverty among Nigerians is growing so high that the state has seemingly lost control of the menace. Today, it is estimated that two-third of the country’s 120 million people are poor despite the belief that Nigeria has earned over $300 billion in oil and gas. There is no doubt that the high rate of poverty is a serious concern to both the government and the people due to enormous resources available in the country. And it is obvious that government’s inability to alleviate the growing incidence of poverty despite state strategies is largely because of its failure to manage the nation’s wealth effectively. This backdrop has forced some observers to conclude that Nigeria has missed a historic opportunity to fight poverty. This is not true for the state has continued to show deep concern over the ravaging scourge of poverty but it is quite unfortunate that all strategies of state have encouraged poverty rather than otherwise.
Despite this concern, the question remains-why have these state-led strategies failed to reduce the prevalence of absolute poverty among Nigerians? For federal government of Nigeria, and with poverty reduction initiative, uneven distribution of resources, complex pattern of social and class differentiation among other factors, have made it necessary for adoption of public private partnership as methodological approach to address development. Not only is public-private partnership recognized as means for implementing policies but also for ensuring an effective management and equitable distribution of resources to the ‘group in poor’. In the light of the foregoing, this article explores the possibility of building a collaborative partnership between private and public sectors as part of the comprehensive national poverty reduction strategy in Nigeria.
CONCEPTUALIZING POVERTY, STATE AND ORGANISED PRIVATE SECTOR
Since the primary requirement for debating any thing is to understand at first the actual thing being talked about, it may nevertheless be useful to provide explanation of these concepts to minimize the possibility of misunderstanding. The need for these clarifications hinges on avoiding the controversy of unsolvable debates about the meaning and applications of concept.
POVERTY
Poverty is a condition of social, political, economical and emotional deprivation resulting from want. In this regards, poverty is reducible to individual disposition arid self-sufficiency, because poverty reflects lack of material necessities and comfort, psychic travail, the multi problem of family and individual dysfunctional behaviour. Since everybody by one circumstances or the other is poor, defining poverty then includes identification of classes of poverty among them. Three broad classifications Absolute, Relative, and Consensual definitions of poverty therefore exist.
Absolute poverty in the perspective of Rowntree (see More 193:47) is the absence of “minimum of provision needed to maintain health and working efficiency”. This involves basic human needs; food, shelter and clothing required for healthy existence. Absolute poverty is determined by assessing the subsistence requirements. These basic physical needs are measured by level of living index; determined by nutrition {intake of calories and protein}, shelter {quality of dwelling and degree of overcrowding and health {infant mortality and available medical facilities.
Relative poverty is a social exclusion from normal patterns of life in a society, through lack of income. It is measured in terms of judgment by acceptable standard of living and style of life according to the conventions of the day. Consensual poverty is the aggregate necessities found to be lacking or wanted by a large majority of the people questioned.
In the context of his article, the concern reflects on the reduction of absolute poverty through partnership with the state. In all poverty remains the level of deprivation that encompasses a shortfall and inadequacies in basic human needs, which prevent people from achieving international acceptable levels of well being (Atoloye, 1996). The people within this poverty line are vulnerable to disease, have low life expectancy and mental retardation. In Nigeria, state of poverty revolves in greater proportion on absolute poverty. The ‘group in poor’ in Nigeria includes; the unemployed, the low paid, single parents families, sick and disable and elderly.
STATE
No single definition captures the meaning of the state, this is because the state is an abstraction: it cannot be seen, touched, a tasted, smelled or heard but the impact is felt. But generally, the State refers to a bewildering range of things – a collection of institutions, a territorial unit, a philosophical idea, an instrument of coercion or oppression (Heywood, 1997). The state is equally understood in three very different ways: idealist, functionalist, and organizational perspective. The organizational perspective is the one, which is of concern to us here. It describes the state as an apparatus of government that is responsible for the collective organization of social existence and funded at public expense (Rodee et al., 1983).
Theoretically, the evolution of the state can be traced to the social contract theory, which believes that the state emerged as result of the voluntary agreement made by individuals in the society. Social contract is not only a historical act; it is used as means of demonstrating the value of government and grounds of political obligation. The idea of state then is to ensure security and well being of the members. To what extent does Nigerian state perform these responsibilities in the face of the increasing incidence of poverty among the citizen? Considering the state strategies adopted to alleviate poverty in Nigeria, has the state made any impact? The answer to these questions, foreground the logic of state-private sector partnership as an alternative strategy for alleviating poverty.
The role of state in human development is illustrated, using developmental state as explanatory framework. A developmental state is one that intervenes in economic life with specific purpose of promoting industrial growth and economic development (Heywood, 1997). The whole essence is to construct a partnership between state and organized private sector in poverty alleviation. The adoption of developmental state strategy in poverty and human development yielded desire results in such countries as Japan, France, Austria, among others. The ‘ partnership state’ places so much emphasis on alliance between state and major business or economic organizations.
ORGANISED PRIVATE SECTOR
The organized private sector is that arm of the private sector, which is recognized by law (Olusanya 2002). Implicitly, there exist organized and unorganized private sector. The organized Private Sector has formal structures and is equally recognized by government.
The organized Private Sector constitutes such institutions as Chambers of Commerce and Industries, Manufactures Association of Nigeria, and Banking and Financial institutions. According to Organization for Economic Cooperation and Development, OECD (Kragh et al 2000), Private Sector, is conceived by the donor community as a basic organizing principle for economic activity where private ownership is important factor, where markets and competition drive production, where private initiative and risk-taking set activities in motion.
Although the organized Private Sector exists in Nigeria, their contributions to poverty reduction are yet to be harnessed by government. If the organized Private sector is brought in the mainstream of poverty alleviation process as partner to the state, socio-economic, political and human development will be guaranteed and among the citizens.
POVERTY PROFILE IN NIGERIA
Nigeria is a country of paradoxes. This stems in parts, the country is rich in resources but citizens suffer from impoverishment. At present Nigeria is going through a difficult economic and political transition after 30years of economic mismanagement and corruption under military rule. Upon the UNDP report on human development index, Nigeria ranks in the low human development category -151st out of 174 countries for which UNDP has data and 22nd out of 45 African countries. The proportion of the population, which, lives on less than a dollar a day is at least 50% and may be as high as 70% (World bank, 1996).
Poverty in Nigeria has been on the increase since independence. Statistical data available indicate that by 1960, the poverty level in Nigeria covers about 15% of the population and by 1980, it grew to 28.0% and it dropped to 43% by 1992. Byl996, the federal office of statistics estimated the poverty level in Nigeria at 66% and there are a number of real indications to show that the current poverty level has gone higher. (Aliyu 2001:1) This presents a very precarious situation below subsistence level among good number of Nigerians. Consequently, the UNDP’s study on human development in 1999, places poverty index in Nigeria at 41.6%
REVIEW OF POVERTY REDUCTION STRATEGIES IN NIGERIA
The government of Nigeria has introduced so many strategies in a bid to reduce poverty among citizens. At independence, all effort to reduce the incidence of poverty was through micro-economic approach. Then, no institution or agency was designated to alleviate poverty. All strategies to reduce poverty were built in national development plans of 1962. Within the framework of the development plans, politics, and programmes, which directly targeted the poor, were not involved. As if it did not achieve its objective, the approach changed to institutionalization of poverty reduction strategies. Let us examine some of them.
OPERATION FEED THE NATION (OFN)
General Olusegun Obasanjo established Operation Feed the Nation in 1979. The programme had its focus on guaranteeing food security. The whole idea was anchored on the premise that a nation with availability of food, has started reducing the prevalence of absolute poverty. Besides, increment in the nutritional level of food, Operation Feed the Nation, leads to the creation of safety nets for the poor; The OFN lasted until General Obasanjo handed over power to Alhaji Shagari in 1979. The Shagari regime shared the same idea of food security for the citizens and consequently, renamed the design ‘GREEN REVOLUTION’. The strategy lasted till 1983, when the military ousted Shagari from power.
Following incessant political instability in Nigeria, poverty alleviation strategy became regime specific. This accounts for multiple programmes, agencies, and institutions established to reduce the incidence of poverty by various administrations. By 1983, the regime of General Buhari did not focus on poverty reduction directly, rather an initiative known as War Against Indiscipline (WAI) was introduced. The Programme aimed at refocusing the value orientation of Nigerians. Queuing on the line to get public services, observing road signs, learning and saying national anthem and so on were the major highlights of the programme. Although, the programme was not strictly poverty- Oriented, it was of the strong belief that a nation that hopes to improve the living standard of the citizens must start by recreating positive thinking on the psych of her nationals. Be that as it may, the act of doing right thing reduces indiscipline and corruption. In the same vein, when leaders and subjects abide by order, poverty is reduced.
Between 1985-1993, General Ibrahim Babangida introduced variety of poverty reduction programmes. PEOPLE’S BANK is one of them. People’s Bank sought to provide loans to prospective entrepreneurs on soft terms and without stringent collaterals. The loans were targeted at small-scale entrepreneurs. Although the programme lasted beyond the Babangida regime, it was ineffectual as a result of corruption and politicization. Until recently the people’s bank with other debilitating agencies have been restructured and renamed, National Agriculture, cooperative and Rural Bank (NACRB) by President Obasanjo. The reorganization is an aim at making the agency more viable and result oriented.
In similar development, General Ibrahim Babangida established Directorate of Food and Rural Infrastructure (DFRI). It aimed at reducing poverty by opening up mineral area through the construction of feeder roads that could create access to hinterland, as well as facilitate the transportation of agricultural products. The amenities such as electricity and rural water supply were made available. The programme was multisectoral as it aimed at creating job and reducing rural-urban migration. Without a doubt, the opportunities created by (DFRI) would have reduced poverty but the programme suffered untimely end resulting from implementation impediments.
Furthermore, the Babangida administration introduced Nigerian Agricultural Land Development Authority (NALDA). It was an effort at promoting agricultural activities beyond the subsistence level. The programme was aimed at enabling farmers engage in commercial and export oriented farming. As an inducement, the farmers were provided with some farming implements, subsidizing costs of fertilizer, and agricultural chemicals. The programme has been scrapped because of redundancy and inability to realize its objectives.
On November 22, 1986, Babangida administration established the National Directorate of Employment (NDE). The NDE was charged with the responsibility of designing and implementing policies that combat mass unemployment. The, regime identified unemployment as a key problem in povem reduction, human development, and economic growth. The NDE consists of the following main programmes
- The Vocational skill development Programme
- The Special public work Programme
- The Small Scale enterprises Programme:
- Agricultural employment programme
So far, NDE is the longest surviving poverty reduction programme and has created more job and opportunities to hundreds of thousands of youth and other related groups. However, it is impeded by lack of publicity, mobility, logistics, funding, manpower, and corruption.
The Wife of the then head of state, Mrs. Miriam Babangida, in her own effort launched an outfit; Better Life for Rural Woman to reduce the growing waves of poverty. But political office holders took advantage of the programme to satisfy their associates and to divert fund for private interests.
Within the regime of late General Sani Abacha (1993-1998), the Family Economic Advancement Programme (FEAP) was established to pursue further poverty reduction. The focus was on giving loans to Cooperative Societies that engaged in poultry production, Garri making, soap making, animal husbandry so on. The (FEAP) lasted for only two years but was able to provide loans to beneficiaries. Equally, the wife of late Abacha midwifed Family Support Programme (FSP). The Programme was gender-biased as it reflected on the premise that women need’ preferential attention and encouragement to enable them contribute to the socio-economic and political growth of the Nation, as well as reduce poverty among women.
The current administration of Chief Olusegun Obasanjo realized the swelling nature, of poverty among Nigerians and consequently established the Poverty Alleviation Programme (PAP) in 1999. The PAP pursued a three-fold objective:
- To reduce the problem of unemployment
- Increase economic growth
- Reduce crime in the nation.
In addition to the objectives include;
- Provision of job for 200,000 unemployed
- Creation of credit facility to farmers
- Increase adult literacy from 51% to 70% by 2003
- Improve Health care delivery from 40% to 100%
The efforts to actualize PAP objectives include:
- increment in the salaries of public workers
- Increment in the Salaries of Public workers
- Increasing the capacity of suppression by the nation’s institutions
- Rationalization and restructuring the 16 poverty alleviation institutions in Nigeria.
The entire structure was broad and designed to accommodate other aspects. But the programme collapsed due to impropriety in allocation and disbursement of fund and parochial politicization.
However, as the programme lost focus and could not alleviate absolute condition of the poor. It became necessary to restructure the programme. Thus, in 2001, the Poverty Alleviation Programme was replaced with National Poverty Eradication Programme (NAPEP). The consequences of NAPEP include;
- Phasing out ad-hoc poverty alleviation programme
- Review and adoption of new policy directives
- Adoption of youth development policy
- Establishment of the secretariat to administer NAPEP Programme
- Developing blueprint on National Poverty Eradication Programme(NAPEP). (FRN2001)
To achieve the objective of the blue print, NAPEP is classified into four:-
- Youth Empowerment Scheme (YES)
- Rural Infrastructure Development Scheme (RIDS)
- Social Welfare Services Scheme (SOWES)
- National Resource Development Scheme (NRDS)
Following the review of this poverty reduction programme, a blue print was established in June 2001. As identified by (Aliyu, 2002) the following amendments were considered in NAPEP;
- Adopts participatory bottom-up approach in programme implementation and monitoring
- Provides for rational framework which lays emphasis on appropriate and sustainable institutional arrangement
- Provides for pro-active and affirmative action deliberately targeted at women, youth, farmers and disable
- Provides for participation of all registered political parties, traditional rulers, and the communities
- Provides for technology acquisition and development particularly for agriculture and industry.
- Provides for capacity building for existing skills acquisition and Training centers
- Provides for institutional development for marking of agricultural and industrial products
- Provides for integrated schemes for youth empowerment, development of infrastructure provision of social welfare services and exploitation of natural resources.
POLICY FORMULATION AND EXECUTION OF POVERTY REDUCTION STRATEGIES
The desire of the government in poverty reduction strategies accounts for the establishment of national poverty eradication council (NAPEC). This is the supreme organ concerned with policy formulation and execution of poverty eradication matters. As outlined by (Amego 2002). The functions are:
- To formulate policy and review all policies and strategies of the government designed to alleviate and eradicate poverty.
- Sets annual targets for institution and agencies of government mandated to undertake such programme, as well as monitor the attainment of such targets.
- Mobilizes and allocates resource for approved programmes, establishes the legislative and constitutional framework for the successful implementation of these programmes.
- Approves and establishes the proper administrative instruments necessary to ensure the implementation and success of poverty alleviation and Monitors the function of the coordinating committee.
Its membership composition is made of:
- Chairman: The President and Commander in Chief of Nigerian Armed Forces of the Federal Republic of Nigeria.
- Vice Chairman: The Vice President of Federal Republic of Nigeria.
- Secretary: The Secretary to the Government of the Federation serves as the Secretary to the Council.
- 13 Honorable ministers of the core poverty eradication ministries.
- Chief Economic Adviser to the President and National Coordinator of the (NAPEP) are all members of the Council.
The membership composition of this council excludes the organized private sector; rather it stresses the old tradition whereby the state is the vanguard of human development and poverty reduction. The exclusion of the organized private sector in poverty reduction efforts reveals that the government of Nigeria does not appreciate the roles of this sector in areas of job creation and corporate responsibility. So, a step towards comprehensive approach to poverty reduction in Nigeria must emphasizes collaborative involvement of organized private sector in policy formulation and implementation of poverty programmes. In this regard, there is need to restructure the NAPEP to include the organized private sector. The poverty Reduction Strategy Paper (TRSP) should reflect the importance of organized private sector as a prospect of achieving international development goal of reducing poverty into half by2015. The partnership state approach to poverty reduction is pertinent against the background of the on-going economic liberalization policy of Nigerian stare which has rolled back the frontiers of Nigerian government in providing welfare services to her citizens.
OBSERVED NATURE OF STATE-LED POVERTY REDUCTION STRATEGIES IN NIGERIA
As various programmes on poverty reduction are examined, the review reveals that so many problems are associated with the formulation and execution of these strategies. These perceived facts discussed hereunder are responsible for the failure of poverty programmesin Nigeria.
It is obvious that all the programmes, policies, and other related efforts in the alleviation of poverty in Nigeria have all been pet projects of one regime or another. This ideology accounts for proliferation in the formulation and execution of this state-led poverty reduction strategies. The Statist approach in this regards, neglects the contributions and roles of organized private sector in the fight against poverty. Upon this negligence, poverty reduction efforts have suffered a setback resulting from the absence of private enterprise collaboration with government.
Moreover, regime egoism, lack of continuity and shift in approach has been the bane, which derailed the focus of all poverty reduction programmes. As a result of these frequent changes in policy and action by various regimes in Nigeria there is no defined policy framework that guides the action of the state.
Besides, poverty alleviation efforts have suffered from political instability, politicization, and improper articulation of strategies and targets. A good number of the programmes do not focus directly on the ‘group in poor’. Most of the poverty reduction outfits that existed have either been avenues for diversion of state fund, or channels of gratifying associates or patronage to public office holders.
The myriad of the agencies have only promoted duplication of functions and conflicts among the various institutions charged with alleviating poverty. This has been responsible for inefficiency and ineffectiveness on the course of implementation. Also, the problem of coordination exists as the institutions have difficulty in achieving unit of purpose due to overlap of functions.
Corruptions at all levels of implementation are another associated impediment towards poverty alleviation. Like most public sector-led programmes, the actors in poverty alleviation strategies in Nigeria have always relegated accountability and transparency to the background, thereby forming nexus for draining of national resources toward private pockets.
Accordingly, not only has the failure to ensure the successful implementation of the various programmes and policies made the incidence of poverty to loom large, the phenomenon has continued to spread and deepen. In the same vein, very many other factors have compounded the poverty situation among which are: slow economic growth, economic mismanagement, infrastructural deficiencies, weak economic and sectoral problems such as inflation rising unemployment, exchange rate depreciation, external debt overhang, etc (CBN, 1999).
THE PROSPECTS OF STATE-ORAGANIZED PRIVATE SECTOR PARTNERSHIP
The concern of Nigerian state to reduce poverty among her citizens is evident in the myriad of programmes or strategies so far formulated and implemented since independence. Perhaps, these strategies appear to worsen the situation, rather than improve the standard of living of the people, the situation has become elusive despite state monopoly of the programmes. Both World Bank and IMF admit this position, as they maintain that the traditional top-down approach to fighting poverty has been ineffective. Consequent upon the inability of the state to head off poverty among the citizens, the desire to reconsider the strategies becomes inevitable. Hence, private sector contributions are considered pertinent to forge collaboration with state as a viable option toward poverty reduction. The partnership of organized private sector and state is most appreciated to avoid contradiction in economic liberalization of Nigerian state.
The prospects of organized private sector-led initiatives stem from the promotion of economic efficiency and social welfare. Also, private sector governance is fundamental in harnessing productive potential and satisfying their human needs and desire; and creating pluralities, which provide both human freedom and human security, (Nwafor, 2003). This explains why most organized private sector achieves their primary objectives, including reduction of poverty. Other ways and means which organized private sector improves economic growth, human development and poverty reduction include: –
- Training workers to acquire knowledge, skill, and attitudes that increase human capital and eventual reduction of poverty.
- Through competition, organized private sector improves quality of product at affordable prices and therefore raises real income and standard of living of consumers, particularly the poor.
- Strengthens non-governmental organizations (NGO’s) to promote peace, and security, and act as the watchdog for human rights abuses and represent the voice of the poor and less privilege.
- Plays very crucial role in job creation and opportunities for the masses, especially the poor.
- Provides infrastructural facilities as part of their corporate social responsibility to the host communities. The amenities such as road, water, electricity, and other social services are pro-poor incentives that reduce the incidence of poverty.
- Organized private sector such as financial institutions has been contributing to micro credit delivery by providing loans and advances to small and medium scale enterprises at subsidized interest rate thereby assisting in reducing poverty. These responsibilities of organized private sector, no doubt place them at a vantage position to work with the public sector.
Considering the collapsed responsibility of Nigeria state in poverty reduction, the need for collaboration with organized private sector becomes obvious if poverty should be reduced. The state in this capacity should revolve on providing a legal and social framework needed for private firms to be part of the decision-making and implementation. This fundamental role of government ensures the provision of rules and regulation for business enterprises, property rights and enforcement of contract. Given these conditions, government provides stable environment for private sector to operate. However when such environment is lacking, economic development and growth is always stagnant, resulting in poverty crisis.
Another aspect government lacks and finds difficult is fairness and justice in allocation of resources. The resources may be available but bottlenecks within the bureaucracy and parochialism on the side of leaders encourage delay and inefficiency. This lead to price inelasticity, which invariably deprives the poor from improving in various enterprises.
Partnership as a new dimension in public management is outstandingly accepted as a strategy of improving the deteriorating services of public officials. Besides rendering effective services, the problem of sunk cost is addressed. So, the desire of government to reduce absolute poverty must be collaborative. Therefore, the fight against poverty must take the dimension of built-in partnership that share work and decision-making. This practice will eventually assist poverty reduction institutions that exist in Nigeria to address the problem of increasing poverty rate (Nweke, 2003).
By and large, to reduce poverty in Nigeria, the need to create a state- organized private sector partnership becomes inevitable. The essence is due to ineffectual performance of state -driven poverty alleviation strategies in Nigeria since independence. The result of ‘statism’ in poverty reduction manifests as corruption. The corrupt practices feature project substitution, plan distortion, misrepresentation of project finances, diversion of resources, etc. These lead to decline in economic growth and development, and escalation of poverty among Nigerians.
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