In Kaduna State, there are insinuations that Governor Senator Uba Sani is experiencing a slower start than expected, which many people attribute to the substantial debt burden on the state. Before leaving office, former Governor Nasir El-Rufai acknowledged the collection of loans by his administration; however, he asserted that the tangible projects and programmes implemented by his administration demonstrate the value of acquiring those loans, with many projects generating revenue and repaying the loans.
It’s essential to acknowledge that no government operates effectively without resorting to loans or borrowing. Globally, it’s widely believed that only a government with sound policies, transparent governance, and financial credibility can attract loans, both domestically and internationally.
Regarding Governor Uba Sani’s initial pace, questions arise: Did he indeed experience a slow start? Many residents of Kaduna anticipate the continuation and completion of projects and programmes initiated by Governor El-Rufai, especially the urban renewal projects—specifically, road construction and rehabilitation in the city and major towns. Addressing the gradual resurgence of street begging by children (Almajiri) and addressing the ‘economic activities’ lull are also crucial expectations among Kaduna people. Including the introduction of some new sterling innovations in governance, especially interacting with and explaining to the public the positions of things in the government.
If Governor Uba Sani’s administration is grappling with a paucity of funds, a viable solution involves devising alternative means of revenue generation beyond the traditional sources like the Federation Accounts Allocation Committee (FAAC), state and local government joint accounts, or existing internally generated revenue (IGR). Every new governor should come with the mindset that he should devise a way to generate funds outside of the traditional ways of funding—Federation Accounts Allocation Committees (FAAC), state and local government joint accounts, or internally generated revenue already in the coffers of the government. No new governor should expect to meet a state’s treasury stacked with funds waiting for him to spend.
Governor Uba Sani could address the current paucity of funds in Kaduna State, if there is one, by initiating a renegotiation of debt servicing agreements and terms with lenders and borrowers. Leveraging his experience as the former Chairman of the Senate Committee on Banking, Finance, Insurance, and Other Financial Institutions, he can tap into his expertise and connections to secure more favourable terms. This strategic move could provide relief to Kaduna State and generate additional funds. Uba Sani has in the past, before becoming governor, contributed to bringing some sterling solutions and programmes to governance, and he was among the young northerners who showed early potential in public service, so there is so much expectation on him.
Secondly, Kaduna is one of the states in the north, with striving weekly markets throughout the state. If the state can create avenues to improve its methods of tax and tariff collection in these weekly markets, more revenue will be generated. For its weekly markets, the Kaduna state government can introduce a modified system of awarding ‘tax collection rights’ to investment firms. This should be modelled according to each market’s culture, needs, and environment. The state can enter into an agreement with a firm to give the government money in advance for taxes from a weekly market, while the firm would then subsequently collect the money by operating as a tax agent for the state through the famous tax auction systems. For example, if it is projected that revenues from the Gadan Gaya weekly market can generate one million naira a week, an innovative investment firm could agree to give the state government about 800,000 naira in advance. Then the firm will collect these taxes in the market for that particular week, month, year, and so on. Furthermore, commercial motorcycles have returned to the streets of Kaduna. If the government has decided to be flexible on their ban, then they are also a source of revenue. And the government should hasten the completion of new markets and neighbourhood centres being constructed by Kaduna State Market Development and Management Company in collaboration with some private sector firms. The completion of these markets and neighbourhood centres will bring good IGR to Kaduna State. These steps align with sustainable methods to enhance the financial capacity of the state.
For every governor of a state, Uba Sani inclusive, inadequate funds, and heavy recurrent expenditure, including demand from other sections of society, is a critical situation that requires critical measures. Governor Sani should have to look at ways to generate revenue other than over-depending on the declining federal allocations. Though we must admit that many states in Nigeria do not have flourishing economic activities that are profitable and easy to tax without upsetting common people, especially in these hard economic times,.
Governor Sani could capitalise on Kaduna’s abandoned assets by identifying, valuing, and disposing of scrap assets through auctions, generating short-term revenue. There are firms that specialise in this area and are generating substantial revenue for some states.
Leveraging his experience and connections, Governor Uba Sani should lead discussions within the Nigeria Governors Forum to collaborate with regulatory agencies, the Central Bank of Nigeria (CBN), quoted companies, and pension fund administrators. Exploring ways to utilise unclaimed dividends, pension funds, and other unutilised funds can be a valuable initiative to address financial challenges.
Zayyad I. Muhammad writes from Abuja, 08036070980, zaymohd@yahoo.com
