Oludamilola Onemano, a Gender and Research Analyst at BudgIT, has raised concerns over Nigeria’s borrowing practices, debt servicing, and cash transfer mechanisms, emphasising the need for fiscal prudence and transparency.
While discussing Nigeria’s 2025 Budget during an appearance on News Central TV’s Jasiri show on Tuesday, Onemano argued that Nigeria’s reliance on the debt-to-GDP ratio to justify borrowing is misleading, as the real concern lies in the debt-to-revenue ratio.
“Nigeria, most times, to justify why they borrow, they do a debt-to-GDP because it’s significantly low. So they tell you that other countries still have higher debt-to-GDP rates. But when we want to be reasonable about what we’re doing, our conversation should be a debt-to-revenue.
“Because there was a certain time we were using almost 90% of our revenue to service debts. So you’re having just a quite tiny sum of 10% to carry out other activities,” she said.
“We already have a 13.7 or 13.6 trillion deficits.
“We have 16 trillion that we’re going to pay back in terms of debt servicing. Meaning that after paying back, we’re still borrowing again to ensure that we close the deficits gap. And then the cycle continues, and the cycle continues,” she added.
Onemano questioned the returns on investments made with borrowed funds, stressing that Nigerians have not seen tangible benefits that justify the continuous accumulation of debt.
Cutting Costs of Governance
Onemano called for a drastic reduction in overhead costs, particularly in government expenditure, to address the country’s fiscal crisis.
She stressed that failure to curtail extravagant spending would perpetuate the cycle of financial strain, leaving citizens to bear the consequences.
“I know that it might seem like a drop in the ocean, but the money we’re using for the overheads, we can probably scrutinise it and squeeze out whatever it is to bridge the gap. If not, we’ll never bridge the gap. I also agree with her, because it’s more of cut your costs according to your size, according to the material that you have.
“Because it’s more of, we will keep suffering if we are not doing the right thing in cutting the cost of governance. Our executives are traveling, and are traveling extravagantly. People are doing things, and they’re doing things extravagantly at the cost of the citizens that are paying the taxes.
“Cut it and say, these overheads are reduced. For a time being, at least let’s all suffer together for the time being,” she said.
Addressing Issues with Cash Transfers
Onemano criticised the inefficiency and lack of transparency in Nigeria’s cash transfer programmes, highlighting flaws in the distribution process.
“Nigeria has a robust data collection system through NIN, BVN, and voters’ registration. Cash transfers should utilise this data to directly reach those in need. Instead, funds are often withdrawn in cash and distributed through intermediaries like community leaders, many of whom pocket a significant portion.”
She pointed out that the current system allows for corruption and misallocation of resources, with funds rarely reaching the intended beneficiaries.
Re-Evaluating the Social Register
Onemano also called for a complete overhaul of the social register used to identify cash transfer recipients. She emphasised the importance of transparency and accuracy in determining those eligible for assistance.
“You need people who are in dire need of that money to be on the register. But then you find out that somebody like me is on the register, all of my family members, in fact I have four cousins or five cousins or so many people. Or the community head has all his relatives, all his councilmen, everybody on the register, right? And then those monies don’t now get to the people that really need them.
“So there needs to be some transparency and re-evaluation of the register and then it should be something that’s public. So don’t just say you’re re-evaluating, make it publicly known that these are the people on the register so that we know,” she said.
Onemano concluded by urging the government to prioritise fiscal discipline, transparency, and accountability in governance, ensuring that resources are utilised effectively for the benefit of all Nigerians.